Designing a Market-Focused Procurement Function

Challenge

One major regional market for a large pharmaceutical client had no procurement capability despite having $2B in spend. The culture in the market was very resistant to change due to local norms and long-established supplier relationships. Corporate and the local market’s senior management agreed to pilot a centralized procurement function before making a full investment commitment in the function.

Approach: Think + Do

The company desired a procurement operating model design, implementation and assist approach, whereby we designed the new function (strategy, process & policy, organization, metrics and systems) and then helped with implementation and change management. Simultaneously, we developed a spend cube and sourced high-opportunity categories. The PSS team provided the team with cultural change management training to facilitate the process.

Results

Acquis achieved hard-dollar cost savings of $40M and increased spend under management by 80% in year one. We developed and implemented a change management plan to help foster compliance with new processes and policies. Acquis implemented a governance structure and process to ensure enthusiasm and acceptance of the new function did not wane. In addition, Acquis provided training to new procurement resources, as well as those re-aligned to the function.