Jersey Electricity – Procurement Transformation

May 25, 2022
Vaida Maksims
Case Studies
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Jersey Electricity needed help to launch a full review of the procurement function, starting from scoping, discovery, planning and implementation for:

Spend analysis
Category management
Systems

Processes
People

Barkers started category councils and reviewed tendering and negotiations practices, delivering £750k savings in the first year. At the same time, processes were defined better and implemented across the organisation.

Challenge

Jersey Electricity operates in a very isolated environment with a uniquely challenging economic environment. There is a massive restraint on resources, restrictions on the available service providers, logistic complications for the supply chain, and legal regulations that are different from any other jurisdiction.

Jersey island has very challenging targets to become fully Zero-carbon by 2050. This ambitious target means that Jersey electricity needs to make quite a large scale improvement in a very short time with minimal resources. The changes that Barkers were helping with included:

cost savings (to make other initiatives self-funding),
organisational changes within Procurement and broader supply chain teams,
process improvements (reviewing the Procurement process, inventory management process, P2P and some financial processes, the delegation of Authority, credit card using principles),
system implementations (asset management, Procurement, contract management, contractor compliance management).

Most of the initiatives meant, first of all, a change in the mindset of all of the stakeholders.

Solution

To achieve Jersey Electricity’s objectives, Barkers provided a senior procurement and commercial consultant experienced in various procurement and commercial aspects as well as communications and stakeholder management. The amount of support was increased over time based on the business readiness and need for the change.

Barkers applied various methodologies to achieve the outcomes:

Project management;
People management;
Communication management;
Stakeholder management;
Process design and management;
Data analytics;
Procurement techniques: tender management, supplier relationship management, negotiations, spend analysis.

All initiatives started with the “as-is” analysis and best practice modelling, followed by the gap and stakeholder impact analysis. Barkers drafted implementation plans, basing everything around the stakeholder and change management.

One of the critical overarching deliverables was the start of the cultural change within the company. Teaching the company to embrace the change, encouraging the approach of not being happy with “we have always done it that way.” This was achieved by leading by example: taking on projects that were slightly more than the initial scope, showing the different ways of approaching questions by dealing with them one by one.

The team was reorganised and positioned into sustainable long-term roles to be able to deliver maximum value.

The systems were implemented, and process controls were put in place to secure the achieved changes.

Throughout the process, Barkers remained focused on the importance of the project timeline whilst achieving an excellent commercial outcome.

Result

Barkers achieved the following results:

New delegation of Authority –
- system access management process improvements,
- credit card usage improvements
- spend approval process improvements
New travel policy
Procurement department restructure: aligning team’s strengths with the roles that need to be performed, secured rotation and succession for retirees and maternity leaves.
Infor EAM (asset management and procurement module) implementation.
Contract management system implementation:
- Visibility of ongoing contracted spend.
- Unwanted risks elimination.
- Unwanted renewals avoidance.
Contractor compliance management tool implementation. Found, negotiated and secured discount and benefits framework for the compliant contractors on the island: fuel, insurance, building materials.
Savings in the first year just below £750k.
Savings in the second year of £550k.
Task management system implementation.
Secured supply during very challenging geopolitical situations: Brexit, Covid.

What was it about Barkers that particularly impressed you?

“Barkers approach to our challenge delivery impressed me.

Jersey Electricity faces a lot of different challenges, and therefore it is tough to find the right people – especially people that would fit our requirements. Being a small and strongly diversified business in a geographically isolated environment, we needed a versatile specialist to come in and advise on multiple different topics. Barkers delivered just that. The consultant working with us was not only strong in the primary field of expertise (Procurement) but could as firmly ask challenging questions to technical people.

Working in this way allowed Barkers to expand the primary scope and Jersey Electricity to receive valuable support.”

Mark Preece, Operations Director, Jersey Electricity