21 September 2000 | David Arminas
House builder Alfred McAlpine Homes (AMH) has revamped its procurement department in an effort to set up more national contracts.
"Cost reduction is part of it, but the message to our suppliers is that it is not the only aim," said Martin Cawthorn, AMH's head of procurement. "It is also about quality of product. This is really a value-added concept."
Cawthorn has put a team of eight strategic procurement managers in place since he joined the company from Southern Water last January, five of whom are from outside the company.
Initiatives such as the AMH strategy are "in their early days", said Peter Jones, deputy director of the Construction Best Practice Programme, a Department of the Environment, Transport and the Regions-funded body. "Within the construction sect0r, there has been a perception that it is different than other sectors," he said.
"But this barrier is slowly being broken down now. There is a lot you can learn from (procurement in) other industries."
AMH's programme replaces a three-manager set-up where managers had some day-to-day buying responsibilities. Most of the homebuilding division's 11 geographical offices will now have a strategic procurement manager.
"We're going beyond the lead buyer concept," Cawthorn said. "We are freeing our strategic managers to concentrate on strategic national deals."
Each of the managers has a portfolio of areas where they have responsibility for putting together national contracts, from researching the business requirements to signing the final agreement.
Each manager also has the responsibility for helping other offices implement this deal, added Cawthorn.
AMH's move towards assured quality is essential within the house-building industry, noted Paul Nicholls, project leader at the Housing Forum, set up to implement better construction supply chain practices as set out in the 1998 Egan report.
It recommended improved processes and partnering in the construction industry to replace the traditional confrontational attitudes between clients, contractors and suppliers.