14 August 2010 | Angeline Albert
A transformation project to overhaul procurement processes at Virgin Holidays has raised the profile of purchasing among senior management.
Under the leadership of procurement manager Ed Worthington, the team has created a centralised database of contracts, established a procurement toolkit for the business to use and implemented a formal purchasing methodology across the company.
“Procurement now has a much higher profile within the business and even stronger ties with procurement colleagues across the group,” said Worthington. “Strategically, we now benefit from a much clearer and consistent procurement methodology, which translates into more robust contracts and greater confidence among the management team.”
Worthington was appointed two and a half years ago to review buying practices for indirect spend across the business. There were wide variations in purchasing practice across different departments, leading to differing levels of control in the contracting process.
He also found inconsistencies with terms and conditions between deals and a lack of a centralised contract database. The team used information in the database they set up to engage with stakeholders and manage the contracting process for various requirements across the business.
This new procurement strategy helped to deliver savings 100 per cent more than the target for the 2009-10 financial year. These included a significant reductions in marketing distribution costs, a saving of a third on external car parking charges and cutting the cost of general office supplies by more than half.
Worthington was himself recognised as Virgin Holidays’ “star of the year” in 2009, an award given to one member of staff across the whole business in recognition of his performance.