DWP spends £4.2 billion per annum on third party goods and services. The Commercial and Estates Directorate provides corporate commercial direction, and directly manages £1.9 billion in spend.

Business Challenges

• DWP Commercial & Estates Directorate needed to shift the emphasis of procurement from tactical to strategically focussed
• Efficiency targets also drove the need to reduce headcount by 20%, while supporting increased savings delivery of £115m over three years
• In order to meet targets, the transition to the new organisation needed to be carried out in parallel with a challenging transformation programme to simplify processes, introduce new technology, embed performance management, upskill procurement staff, deliver savings and change behaviours

Solutions

• Mobilised a joint DWP and Atos Consulting change team to design and implement a new Commercial Operating Model, CED organisation design and commercial processes, supported by a phased plan to deliver commercial savings over the next three years
• Worked with CED management to populate the new organisation while implementing new functions for Commercial Intelligence and Commercial Performance Management
• Run a ‘just-in-time’ procurement learning programme tailored to meet the needs of each new team supported by an electronic e-toolkit to maximise knowledge transfer to staff
• Pilot new processes through cross functional teams with on-the-job coaching for Strategic Sourcing, Demand Management and Supplier Relationship Management
• Engage with customers to increase commercial awareness and cost consciousness, and supporting them in developing collaborative plans and budgets that incorporate commercial savings activity

Benefits

• Reduction in external spend for the first time in the Department’s history
• Population of a leaner, more strategically focussed and highly skilled organisation that meets reduced resource targets, to agreed timescales
• Customers with clear understanding of the new organisation and how they interface with it, developing collaborative plans to meet the increased challenge of the next spending reviews
• Implementation of first wave of savings initiatives, delivering £117m savings (over 3 yrs)