Sourcing strategies

10 July 2012
I am responsible for property across Lloyds Banking Group, which covers around 3,000 retail branches and over 150 office buildings. The relationship with group sourcing is a really positive one and I see the head of sourcing for property as a key member of my leadership team. This integrated approach is key to me delivering the best outcome for Lloyds. The business landscape is increasingly complex such that delivering continuous improvement, while increasing service to our customers, is becoming more challenging. We rise to this by bringing expertise to the table, ensuring that sourcing advice is part of the business plan. In addition to taking the right advice and applying the right tools, I find it invaluable to promote an open and positively challenging environment. My team is cross-functional and brings together senior and committed leaders – the head of property sourcing has been part of my leadership team for the past three years and is a key part of my daily operational updates, through to my strategic board meetings. As I manage external spend running into the hundreds of millions of pounds per annum, sourcing is an integral part of the team, giving me insight, challenge and direction when it comes to sourcing, commercial and legal issues. This ranges from the co-development of long term strategy, incorporating lean, simplification and supplier collaboration, through to the tactical issues such as commercial and contract negotiations. It’s fair to say that, in the past, the relationship didn’t always deliver the best of our joint expertise, being primarily based on short-term price reductions. We re-engineered this collaboratively, to ensure we develop the right value proposition. Again, the teamwork ethos is critical as I aim to bring the best of individuals’ and suppliers’ skills and experience to bear. We don’t necessarily always agree, but that’s part of a healthy relationship. I also recognise that our business needs to work at every level, therefore I ensure that the cross functional teamwork operates across each of my business areas. The sourcing team is key to ensuring that we areoperating effectively and to maintaining ‘hand in glove’ collaboration. For me to develop the right working relationship, there are a few key fundamentals that I expect and see with my sourcing colleagues: to have a close, expert understanding of my operation and the markets we operate in; to be clear on inputs and deliverables to each area of my business plan; and to ensure that they build personal relationships at every level to influence effectively and to bring the best out in my overall team. I advocate that other senior leaders in similar positions engage fully with their sourcing colleagues and use this to drive real and tangible benefits. ☛ Paul Baker is group property director, Lloyds Banking Group
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