Insurance Company
– Procurement Transformation
The client, a FTSE 100 insurance company operating across Europe and multiple brands with an annual revenue of more than £5B, was created following a regulatory requirement to break up its parent company.
A consequence of the establishment of the new company was that the majority of the procurement function, capabilities and processes remained with the parent company and required to be built to manage the circa £2bn of 3rd party spend.
Client Objectives
To support the separation the client needed to negotiate a Transition Services Agreement (TSA) with its parent company, and then contract manage the associated exit.
In addition to the TSA, the Lifecycle team were required to contract for new technology services for Voice, Hosting and Desktop, as well as deliver the novation of circa 100 third party software licensing and support agreements.
In parallel, a 90-day review was requested to assess current capabilities, organisation structure and business processes, and to define and design a new procurement function and associated processes.
Skills & Capabilities Provided
Working with the clients existing procurement, technology and legal teams, the Lifecycle team provided commercial expertise to deliver new technology contracts, and novations of pre-existing agreements.
Leveraging Lifecycle leadership experience, advice, tools and techniques, enabled the joint team to:
• Conduct people and organisational capability assessments
• Design a new procurement Target Operating Model (TOM)
• Implement category management
• Introduce an integrated sourcing council into businesses finance processes
• Supplier tiering including consolidation
• Deliver costs savings in excess of 10%
• Establish Supplier Relationship Management (SRM)
Client Benefits Realised & Project Outcome
The client was able to successfully establish new IT services and transition out of the Transition Services Agreement to budget and on-time, without any service disruption.
The client was also able to build and run an efficient procurement function and sourcing processes which were fully integrated with the business operations and financial approval processes, and ensured accountability and delivery was optimised.
These integrated processes have been fully embraced by the client organisation and have survived materially unchanged for over 5-years.