Cultural revolution set to save £20m

1 November 2001
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01 November 2001 | Robin Parker

Communications firm Telewest plans to save £20 million this year after an aggressive programme to improve its culture of purchasing and logistics.

John Spottiswood, group purchasing and logistics director, said that when he joined Telewest last year it had a purchasing spend of £1.25 billion, with only one recognised buyer handling more than 8,000 suppliers.

Since implementing a formal strategy at the end of 2000, the company now sources from 400 suppliers after staff were forced to seek them out by any means available.

"Staff were sitting back, waiting for business to come to them," Spottiswood said. "I sent them to every conference and forum going. It's a case of having to get out there and get a name for yourself."

Spottiswood said difficult financial circumstances forced the department to grow up fast. In the past two years, Telewest's share price has fallen from over £5 to a low of 22 pence.

The company was able to achieve the savings - which amount to £11.8 million so far - with a back-to-basics approach. Both risk analysis and supplier qualification were established and contracts revamped. It has also cut regional divisions from seven to four.

The 12 buying team members have each been assigned a key "super-strategic" supplier and two strategic suppliers.

SMnov2001

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