Severn Trent revamps in pursuit of utility top spot

23 August 2006
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24 August 2006 | Rebecca Ellinor

Severn Trent Water has unveiled plans to overhaul its purchasing department. But it is not yet clear how the restructure will affect the current procurement team.

The changes, approved by the company's board this month, are designed to help it become the most effective procurement department in the utility sector by the end of 2008.

Plans include increasing headcount from 54 to 60; implementing e-auction and e-sourcing tools by the end of September; and introducing new category managers and category specialist roles.

The restructure follows the recruitment of Larry Beard, who became the firm's first board-level purchasing director in February this year (News, 16 February).

Beard said the new specialist roles will allow purchasers to take on a senior post without becoming people managers. He has also created a strategy team to drive best practice and process improvement across the department. In addition, he hopes the restructure and use of e-tools will "create space" for purchasing managers to think strategically.

However, he warned that there would not be roles for every-one, so the changes might lead to some redundancies.

"We're trying to understand who can slot into new roles. It's down to their skills but also their wish to do a new job," he said.

Appointments to these new roles will be announced from the third week in September. One of Beard's aims is to develop leaders in his organisation.

"We've historically employed or measured people against technical ability and not their leadership behaviours. Now the roles have changed as far as what we expect from them. He said staff would be offered bespoke training to improve their skills.

The purchasing director added that the firm would use various measures to test its success against other water, gas and electric companies. Hard measures include use of an index produced by the Procurement Strategy Council, while soft measures include other firms wanting to benchmark themselves against Severn Trent and staff being headhunted.

Severn Trent is the world's fourth-largest privately owned water company. It serves more than eight million customers.

SMaug2006

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