- Optimum is a procurement outsourcing and consulting company.
- We provide high calibre procurement resource and expertise to a growing number of organisations in a wide variety of markets.
- We deliver significant and sustainable commercial value to our clients by transforming their approach to sourcing and vendor management.
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Procurement Outsourcing
The advantages of procurement outsourcing
Improving bottom-line performance comes by not only increasing sales revenues but by reducing the costs of doing business. One strategy to deliver both outcomes is to utilise Business Process Outsourcing (BPO) which focuses on re-designing business processes to radically improve operational performance. Central to the execution of a well-managed BPO initiative is the use of procurement outsourcing as a key lever in transforming purchasing and supply performance to unlock significant savings and value streams.
Without question, procurement is growing in terms of its strategic importance to organisations as global competition intensifies. However, the elevated status of the procurement function is being challenged by increasing expectations from stakeholders needing access to a highly competent sourcing service that consistently achieves agreed financial targets, and mitigates supply chain risk.
Procurement outsourcing had a record year in 2010, a report from the Everest Group has found. For further information click here to read an article from Supply Management.
The role of the procurement outsourcer
As a leading procurement service provider, Optimum supports the strategic agenda by increasing an organisation’s procurement capability, providing dedicated category experts focused on driving incremental savings and value, typically in non-core expenditure. We offer deep domain knowledge in under-performing categories of spend, combined with significant experience in establishing and enforcing integrated procurement processes across the organisation.
Even during the initial stage of an outsourcing arrangement we frequently secure significant savings for clients; quickly lowering the costs of goods and services. These immediate value streams help enhance margins, fund innovation and support growth.
Optimum work with clients on company-wide savings plans that are embedded into the overall business plan. We operate with a clear mandate from the boardroom and our independence ensures we are well positioned to manage often radical change programmes. This drives a sense of urgency, ensuring a pragmatic cross functional approach that focuses the business to embrace change, work efficiently and achieve fiscal targets.
Importantly, we deliver increased control on sourcing activities through a proven outsourcing methodology backed by a rigorous and robust governance model. This process ensures senior executive sponsorship is secured which drives business change, eradicates maverick buying and supports the goal of retaining sustainable savings to the bottom line. All savings are formally endorsed by a senior stakeholder in finance, recording only savings that have been fully realised within the profit and loss account.
The benefits of procurement outsourcing
Improved pricing and cost reduction is a prerequisite in any successful procurement outsourcing arrangement. However, headcount reductions are also frequently achieved combined with key staff being allowed to re-focus on core activities. Beyond this, further strategic benefits materialise as we provide clients with detailed market and supplier intelligence, driving more objective sourcing decisions that we ensure are aligned to the strategic goals of the organisation.
Outsourcing provides crucial visibility to clients on absolute expenditure levels. Maverick buying is a common problem meaning spend is frequently invisible or at best under estimated. The application of professional procurement expertise to specific categories ensures fragmented buying activity is removed and compliance to approved vendors and contracts is restored.
Full accountability for savings and supplier performance resides with the outsourcer. However, it is a prerequisite that the procurement service provider is given end-to-end responsibility for sourcing strategy and implementation for the specific categories in scope.
