Public Services Housing

Review of procurement.

Enabling effective discipline and management of external expenditure in a decentralised operation.

A large housing association wanted to retain decentralised purchasing but needed advice and guidance on how they could maximise purchasing performance under these conditions. Sterling was commissioned to carry out a review of procurement, identifying the gaps between current practice and good practice to enable the Association to progress towards good practice. The work comprised discussions with a sample of employees, study of procurement procedures and documents, and analysis of data from the accounts systems.

We found:
• limited understanding of objectives concerning external expenditure
• few functional procedures
• a fragmented approach to most aspects of procurement
• unclear responsibilities
• little evidence of the management of procurement
• substantial volumes of clerical and administrative work and paper
• no ready system for capturing and disseminating procurement data
• scant skills and knowledge related to procurement.
We recommended:
• an overall objective for the Association’s procurement
• a procurement manual specific to the Association’s needs
• procedures to minimise work
• a structure for attributing responsibility and accountability
• a means of providing reliable information and the ability to use it
• mechanisms for reducing transaction volumes
• systems to provide help manage external expenditure and suppliers
• the means of devolving responsibility and communicating with people appropriately
• the development of skills and knowledge in procurement.

In addition to advising on procurement planning and strategy, we assisted in fulfilling the recommendations including providing purchasing training for staff and assisting with the introduction of purchasing cards.

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Sterling Management Consultants based in Worcester West Midlands