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EmpoweringCPO, a leading procurement services company, recently partnered with a large hospital and medical care organization in the UAE to address their procurement challenges and drive cost savings. The client, with multiple verticals and business units across different countries in the Gulf Cooperation Council, sought to find comparable alternatives to their current medical consumables supplier base in order to obtain better prices and achieve savings on the procurement front. EmpoweringCPO developed a comprehensive solution involving strategic sourcing and vendor optimization to address the client’s requirements.
The client is a prominent hospital and medical care organization operating in the UAE. With a diverse range of verticals and business units spanning different countries in the Gulf Cooperation Council, the client faces the challenge of managing procurement processes and ensuring cost-efficiency in the acquisition of medical consumables.
The client’s primary challenge was to identify comparable alternatives to their existing medical consumables supplier base in order to obtain better prices and reduce procurement costs. The client recognized the potential for significant savings through strategic sourcing and sought EmpoweringCPO’s expertise to optimize their procurement operations.
EmpoweringCPO devised a comprehensive solution to address the client’s challenges and drive cost savings. The solution involved a full-fledged strategic sourcing project, including Request for Proposal (RFP) management, supplier research, response analysis, sample management, impact analysis, and negotiations between selected vendors and the client. The key steps undertaken by EmpoweringCPO are as follows:
The strategic sourcing project conducted by EmpoweringCPO resulted in significant benefits for the client:
The strategic sourcing project faced several challenges, including:
EmpoweringCPO’s strategic sourcing project successfully addressed the client’s procurement challenges and delivered tangible results. By conducting a meticulous RFP process, engaging with a wide range of suppliers, and negotiating favorable terms, EmpoweringCPO enabled the client to achieve substantial cost savings, consolidate their vendor base, and establish beneficial partnerships. Despite challenges related to data organization, external factors, and stakeholder alignment, EmpoweringCPO’s expertise and commitment to delivering procurement excellence ensured a successful outcome. The strategic sourcing initiative empowered the client with improved procurement practices, laying a foundation for sustained cost optimization and operational efficiency in the procurement of medical consumables.
EmpoweringCPO is a team of experienced sourcing and procurement professionals with hands on experience of having worked with many fortune 500 companies. The company was founded in 2011 and since then has executed multiple strategic sourcing projects and have achieved average savings of 10-12% so far. In addition to Strategic Sourcing their other offerings are Spend Analysis, Procurement Intelligence, Procurement Analytics, Best Cost Country Sourcing, Procurement Outsourcing, Built Operate Transfer, Supplier Diversity, Sustainable Procurement, Tail Spend Management, Item Master Optimization, Collective Buying, Compliance Tracking and Managed Procurement Services.
Compliance management is very critical as otherwise the procurement organization may run into a scenario where there is a huge gap between realized savings and reported savings. Many procurement functions estimate large savings numbers when contracts are signed. They also invest significant time and effort in negotiating contracts for necessary goods and services, only to have a third or more of their purchasing dollars flow outside those deals. Some of the obvious fall-outs of non-compliance and maverick purchases are:
As compared to the current contract that was finalized after the sourcing process, the tool helps in tracking:
The objective of this tool is to ensure that the orders are placed only with the vendors that were shortlisted after the sourcing process and at the same price that was agreed upon and negotiated during and after the strategic sourcing process.