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Case Study

Aggressive Sourcing Achieves Significant Savings for Environmental Services Provider

Leveraging the combination of category market intelligence and a bona—fide strategic sourcing methodology make for a results-producing model and significant sourcing savings.

The Profile

Client present in more than 550 communities across North America, leveraging a complex relationship between water, waste and energy to solve environmental challenges and help customers reach their goals.

The Objective

This project was to launch several strategic sourcing and tail spend activities within a scope of roughly 15 Direct and Indirect industrial type categories and 1000’s of current suppliers. The expected deliverables were to deliver at minimum 10% savings, to develop the corresponding strategic sourcing plans and to train the procurement team on strategic sourcing methodologies.

The Challenge

The collection of spend data was especially difficult without any existing P2P or Spend Analytics tools. The extremely fragmented supplier base was a challenge to build an external and internal spend overview across the different information systems. Last, the lack of strategic supplier or category playbooks obliged the team to start with basic data collection (client & supplier data), aggregation of spend by main categories and suppliers to build a step by step executable action plan.

The Impact

As mentioned, the overall approach was to:

  • address the spend analysis,
  • to define executable addressable sourcing waves,
  • to deliver savings and to train the team on strategic sourcing processes.
  • significant sourcing savings

The financial results were above target with 16% savings across the different categories.

The client team was enthusiastic about the training programs and learning about best-in-class strategic sourcing practices. All addressed categories had a defined sustainable action plan with a new supplier network.