Procurement initiative takes aim at campus buying challenges
08 December 2004
Driving the maze of campus access roads to help a new supplier learn the routes may not seem like a big deal, but it’s one way that Business Services staff are going the extra mile to improve service for the campus.
“Our new office-products supplier is promising to deliver campus orders in one day,” said Purchasing Manager Dave Kolsom, “but the campus doesn’t have vehicle access to many buildings and the new drivers weren’t familiar with the access roads and safety issues. So Central Distribution offered to bring the OfficeMax drivers along on the regular delivery runs to show them where the routes are, where there’s construction, and where they can park.”
Creative ideas like the ride-along program, new purchasing agreements, and an expanded campus buyer program are all elements in the Berkeley Procurement Initiative, designed to help streamline business operations for campus departments.
While none of these complaints were breaking news for Business and Administrative Services (BAS) and staff were already working on solutions, one surprising bit of information to emerge was this: of the $500 million the campus spends annually on procurement transactions (involving goods, services, and contracts), only about 20 percent is processed through the central purchasing operation. Thus, with more than 1,900 campus employees touching some part of the process, any plan to improve campus purchasing must extend beyond the central procurement operation. The Berkeley Procurement Initiative was developed with this reality in mind.
Better than a band-aid
“The initiative includes elements that address costs, service, procedures and operations, and risk management,” says Ron Coley, associate vice chancellor for BAS. “Our approach touches every part of the process, in both the central operation and the departments, because a band-aid solution just won’t work.”
Under the new plan — developed by the initiative team, with assistance from the UC Office of the President and Huron Consulting Group — experienced staff have been added to help manage data analysis, risk monitoring, and a process known as “strategic sourcing.” The team created training and communication materials, led a series of planning sessions for both satellite buyers and staff in the central Procurement Operations office, and began working with UCOP on new systemwide purchasing agreements. It also developed a new campus-buyer model, offering large departments a dedicated buyer, greater delegation authority, and increased central support compared to the existing satellite model. The first of these campus-buyer positions is being funded and piloted through an agreement with Intercollegiate Athletics.
Sam Schiff, BAS manager of strategic sourcing, who joined the initiative team in September, notes that the campus can leverage its position as a large-volume purchaser to secure more competitive prices and better service. “UC’s substantial budget cuts in recent years make it imperative that we focus on lowering our operating costs,” he says. Based on market-basket assessments that compared prices that departments are currently paying on hundreds of items with those available under the new initiative, Schiff foresees additional cost savings of at least 15 percent. “Every dollar we save in office supplies and computer equipment spending will flow directly to the bottom line of a department’s budget,” he said. “At the same time, we want to maintain our relationships with small, local, and disadvantaged businesses, and we’ll incorporate that commitment as we implement the initiative.”
An agreement with IBM has been in effect for several months. Online access to both this agreement and the new agreement with OfficeMax is being rolled out in January. Both suppliers promise quick turnarounds, excellent customer service, and significantly lower prices. Buyers will purchase goods from these suppliers through Blu, the campus business portal; the companies are working with campus IT staff to make sure the online access is user-friendly.
Knowing who you’re dealing with
As the year comes to a close, the Procurement Initiative team is working on the conversion of existing satellite buyers to the new campus-buyer model and planning a vendor fair and training to help departments make the most of the OfficeMax and IBM agreements. The vendor fair is scheduled for Jan. 11, 12, and 13; watch for campus announcements in early January.
“People just really appreciate that contact with the vendor,” says Albert Meerson, a BAS staffer involved in support services for campus purchasers. By meeting the vendors and learning about their product lines, “campus staff know who they’re dealing with.”
The team is also working with the BFS-upgrade team to make sure that next year’s upgrade of the financial system will include features that support better control and reporting of purchasing transactions.
For information about the Berkeley Procurement Initiative, e-mail firstname.lastname@example.org, or check the BAS website at bas.berkeley.edu/BASexcels/Initiatives/procurement.htm.