16 February 2006 | Rebecca Ellinor
Severn Trent Water has recruited a purchasing director - and made it a board-level appointment.
Larry Beard takes up the post this month after leaving engineering firm ESAB Holdings.
Severn Trent, a privately-owned water company serving more than eight million people in the UK, has decided procurement should report to managing director Tony Wray.
Wray, who has been with the firm since March, told SM
: "When I arrived, purchasing was embedded within the engineering organisation. I took the decision early on that it was so important I wanted someone at the top table, but it's taken a while to get into the market to find the right character."
Wray said with £600 million a year going through Severn Trent in total, it deserves the focus of the executive team.
As a regulated company, Severn Trent must prove it is spending money effectively and efficiently.
"It shouldn't be unusual for purchasing to be on the board - it is a critical part of delivering the business," he said.
Beard added: "Wray wants us at the top table when talking about strategic business issues and it's been missing until now."
Roy Ayliffe, CIPS director of professional practice, told SM that it is rare for purchasing to feature so prominently in the boardroom.
"Companies must have control of inputs just as much as operating costs and outputs. More chief executives understand this and are doing something about it - the trend is in the right direction but there is a long way to go."
While at ESAB Holdings, Beard set up the firm's first global purchasing structure. His main role at Severn Trent is to provide leadership for procurement within the firm. He will develop and implement value for money strategies, ensure efficient processes are in place, and identify and deliver bottom line savings through efficient supply chains.
Senior purchasing manager Roy Burns is leaving Severn Trent after 21 years with the organisation. He has not yet decided whether to take another purchasing role or full-time retirement.
In his working life, Burns has seen purchasing transformed from a decentralised, tactical activity into a strategic operation. He also highlighted the increased professionalism of the function.