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Decentralize out of control purchasing to now controlled centralized purchasing

"Bellwether has eliminated the paper in purchasing and allowed us go from decentralized out of control purchasing to centralized purchasing and invoice processing. This has reduced cost and provided us a clear picture of accruals."

Ben Belflower, Reporting & Analysis Manager, Aramark

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When Procurement Works and When It Doesn’t

When procurement doesn’t work you face problems of all sizes. Minor problems can be fixed quickly for little or no cost and others take up tremendous resources of both time and money to repair. Problems occur for a number of reasons including poor strategic planning, dated technology, or even the absence of technology.  Even it today’s hi-tech world there are thousands of small businesses that still utilize a paper-based procurement system, copied requisition forms, and Excel tracking.

Just to drive the point home of the potential devastation of a failed procurement process, let’s look across the ocean to our British friends.  According to news reported by Supply Management the Department for Transport discovered “significant technical flaws” in the bidding and procurement process for the West Coast Main Line railway franchise while being sued. The end result of the investigations was that three officials for the government were suspended and the total cost to British taxpayers could reach to the US equivalent of over $61 million!

Originally developed in cooperation with the Bill & Melinda Gates Foundation, Accenture Development Partnerships, Yale University’s Global Health Leadership Institute (GHLI), and government partners like MSD, Coca-Cola joined the partnership of “Project Last Mile”. This partnership has helped deliver life-saving drugs to nearly 20 million people since 2010 through a more efficient supply chain by using Coca-Cola’s proven logistics models. Patients in three African nations will now receive AIDS, tuberculosis and malaria medicine following the success of a pilot project in Tanzania.  The best of both worlds – government and private enterprise – working together for humanity. It doesn’t get much better than that.

These are two extreme examples. Your mistakes aren’t likely to result in millions of dollars in damages and your reach won’t be that of a global fortune 100 company. But our hope is that you can learn from these two examples about the impact your business can have when it has procurement systems in place and running smoothly.  If your procurement system isn’t up to date, can use some additions or is simply far below where it needs to be, let’s discuss where we can help. Meanwhile, check out this b-roll video from Coca-Cola . It really brings to life the impact and far-reaching effects of “Project Last Mile.” 

August 6, 2013
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BY Bellwether
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