Savings, lasting impact and credibility generated even after a merger

The Client: Major Australian Bank

Grosvenor has conducted a number of procurement and transformation projects with this banking client before and after a merger with another organisation.

In one project, Grosvenor was engaged to act as the role of Head of Procurement, to assist in transforming the function. Grosvenor was required to maintain the business as usual functions of procurement while conducting the review of the department, including the support provided to the rest of the Bank.

Savings opportunities were identified and further outsourcing scoped. Positions and roles were restructured, reducing overall resources while achieving significant overall gains in savings and project completion timeframes.

The procurement department was directly responsible for the management of $80m per annum in contracted spend across a number of categories. Annual savings of $3m from continuous improvement and facilitated by strong contract management were acted upon in the first few months. The procurement department also provided commercial advice to other business units for the remaining 80% of recurrent expenditure.

Grosvenor oversaw the downsizing of the department while positively impacting on the quality and quantity of procurement projects being delivered to eight discrete business units.  The project and implementation were highly successful leading to major improvements in the credibility of the procurement function across the Bank. The negative attitudes to both the project, and over time to working within the department, were overcome quickly without impact on the project.

Another measure of the success of the work was that the management of the procurement function within the smaller organisation was placed in charge of the merged function within the much larger organisation. This was as recognition for the transformation implemented pre-merger.

Since this time Grosvenor has continued to provide procurement related advisory services, including to the merger and subsequently some significant procurement projects which continues to the present day.

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Stefan Gassner

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