01 February 2007 | Antony Barton
Surrey County Council has made savings of almost £18 million since last April by transforming its procurement processes.
This sum forms the bulk of £31 million efficiency savings across the whole authority and contributes to its aim of cutting £43 million by the end of the next financial year, according to the head of procurement.
The function was overhauled by the launch of a shared services centre in January 2005. This brought together the council's procurement, contract management, payroll, human resources and business support functions. Its main contribution to procurement was to ensure all purchases went through a central purchasing team to eliminate duplicate orders.
Julie Fisher, head of procurement for the council, told SM that within six months of opening the centre, the council had reduced its vendors by 15,000. She said: "We found a number of suppliers providing the same commodities. In stationery, staff would be able to call up any supplier to get paper and pencils. Now we have one contract and departments can log their orders on the web."
Consolidating agencies, particularly in the provision of social care, and using stock contracts where possible cut costs even further.
In May 2006, the centre was named the best new shared services organisation in the Shared Services Excellence Awards, hosted by the International Quality and Productivity Centre.
Fisher was employed last August to form a new procurement team. Although the shared services centre covered transactional procurement, there was no strategic procurement team. She expects the strategic approach to result in further savings in the next year.