Copyright 2008 SiPMwww.sipm.com

Location x

Date, V.1

CLIENT XX PURCHASE WORKSHOPOBJECTIVES 20XX

1

This is a draft example of a workshop. Feel free to adapt it to your needs. It should be a “feel good” workshop, where your buyers feel important. Celebrate the successes of last year and develop next years objectives. In the end, the buyers leave with individual objectives that are not yet SMART. They get 1 week to digest them and discuss them with the manager before final sign-off.

Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00: Catching-up Lunch

18.45: Refresh 13.30-14.00: 10. Wrap-up

19:30: Bar and dinner 14.30: End

2

Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00 Catching-up Lunch

18.45 Refresh 13.30-14.00: 10. Wrap-up

19:30 Bar and dinner 14.30: End

3

Copyright 2008 SiPMwww.sipm.com

OBJECTIVES WORKSHOP

4

Workshop Objectives

• The goal of the workshop is as a team to:

DEVELOP OUR INDIVIDUAL BUSINESS OBJECTIVES FOR 20XX

The difference between where we are (current status)

and where we want to be (vision and goals)

is what we do (target objectives and action plans)

5

Workshop Objectives

• The objectives will need to be aligned

– Between each other

– In line with corporate strategy

– In line with purchasing mission

– Support the long-term purchasing vision & strategy

– Leave room for personal objectives

• Only new objectives

– On top of current daily activities

6

Workshop Objectives

• The objectives will be SMART

– Specific Clearly state what it is you want to do/achieve by way of a factual description.

– Measureable. Ensure that the success of your business objective can be measured against concrete

criteria.

– Achievable. Is the objective achievable given your current operational resources and/or

competence/capacity.

– Realistic. Is the scope of the objective within the bounds of what is recognisable as a proper

‘business fit’.

– Time Bound. Include a time scale within which the objectives should be achieved .

7

Copyright 2008 SiPMwww.sipm.com

THE BIG PICTURE:PURCHASING VISION AND MISSION

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Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00 Catching-up Lunch

18.45 Refresh 13.30-14.00: 10. Wrap-up

19:30 Bar and dinner 14.30: End

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We are in the WINS program

• WINS : Our program to become best-in-class.

• World-Class Innovative Sourcing

• Innovative and structured methodology to approach world-class

• Todays workshop is part of WINS

Mr. WINS

More info at www.sipm.com 10

Framework

Client Vision & Strategy

P u r c h a s i n g Mission

P u r c h a s i n g Strategy

P u r c h a s i n g Structure

P u r c h a s i n g Vision

Categ

ory

plan

Execution

Categ

ory

plan

Categ

ory

plan

11

Client mission and strategy

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TYPE HERE CORPORATE MISSION/STRATEGY

Client mission and strategy: link to purchasing

13

TYPE HERE WHAT THIS MEANS FOR PURCHASING

Scope

Direct: 40 M€40%

Overhead: 25 M€25%

Scope: 65M€

Labour: 35 M€35%

14

Purchasing Vision

Client Vision & Strategy

P u r c h a s i n g Mission

P u r c h a s i n g Strategy

P u r c h a s i n g Structure

P u r c h a s i n g Vision

Categ

ory

plan

Execution

Categ

ory

plan

Categ

ory

plan

15

Purchasing Vision client

WE WILL BECOME ONE OF THE

FEW “WORLD-CLASS” SOURCING DIVISIONS

IN THE WORLD

WE WILL BECOME ONE OF THE

FEW “WORLD-CLASS” SOURCING DIVISIONS

IN THE WORLD

16

= INSPIRING ONE-LINER (SEE EXAMPLE):

Why is World-Class important?

0

10

20

30

40

50

60

70

80

90

CompanyRevenue

Profit Dir. Labour Ind. Labour Overhead COS

Mil

joen

en

7M€61M€

85% of our turnover is spent with suppliers!We will need to superiorly manage this spend.

Source data: xxx

SCOPE

17

Vision: what does world-class look like?

• Internal customer satisfaction (both board and BU)

• Being “spoken” (in the same way as an UPS…)

• Client purchase keynote speaker at international conferences

• Discover differentials with competition

• Suppliers ask us to present at their (world-)conferences

• Our suppliers want to align with us

• xM profit increase thanks to purchasing

• Manage total spend

• World-class = Rarity/unique/small world

RESULT OF BRAINSTORMING

18

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Vision: what does world-class look like?

Your logoYour logo

Possible quote to paste on site: Client stock quote peaks thanks to client purchasing.Client purchasing enhances overall value through great strategic thinking, great planning and smart negotiations.

Client website/investors page

19

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Purchasing Mission

Client Vision & Strategy

P u r c h a s i n g Mission

P u r c h a s i n g Strategy

P u r c h a s i n g Structure

P u r c h a s i n g Vision

Categ

ory

plan

Execution

Categ

ory

plan

Categ

ory

plan

20

Purchasing Mission

• = measurable long-term goal

By 20xx, purchasing will have:

•Xxx

•Saved xxxM€ (DCF)

•built a reputation of “reliable partner”: (example)

•strong team with professionals who belong to the top in their field

•supplies transparency in (future) spend

21

TYPE HERE THE PURCHASING MISSION

Purchasing Strategy

Client Vision & Strategy

P u r c h a s i n g Mission

P u r c h a s i n g Strategy

P u r c h a s i n g Structure

P u r c h a s i n g Vision

Categ

ory

plan

Execution

Categ

ory

plan

Categ

ory

plan

22

WINS strategy: main steps to reach world-class

Skills(People/processes/systems)

Bronze Silver Gold

1. Strategic Sourcing and Category Management

Bronze Quick wins/cut down source plans in placeMore formal sourcing strategies under developmentSavings are measured but not captured

Silver Defined way of sourcing agreed and in place for all spendEach major category has a sourcing leader

Global sourcingMeasure, Capture and Control savings (1), formally acknowledged by local FD

All significant glass have dual supplyTransition PU to dual sourcing/600ml technology

Gold Time allocation buyers: 5% tender, 5% problem solving, 40%analysis and cost out initiatives, 20% listening to stakeholders, 20% competitive advantage analysis

Savings are aligned with budget and reporting packTop Management review & challenge of source plans

(1): capturing savings is different from price down benefit.

Nothing1 2 3 4 5 6 7 8 9

Bronze Silver Gold

23

Cov

erag

e

0%

40%

80%

WINS strategy: main steps to reach world-class

20%

SKILLS

0%

40%

80%

CO

VE

RA

GE

Bronze Silver Gold

0 MEASURE

Yr 3

Yr 4

Yr 2

Yr 1

60%

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MISSION: DESCRIBE IN BULLETS

Vertical axis: coverage

25

EXPLAIN HERE THE CURRENT STATUS

Horizontal axis: skills

SkillsWINS support - Tactical process - operational process

0,0

2,0

4,0

6,0

8,0

10,0

STRATEGIC INT LEADERSHIP DESIGN of TAC TENDER PROCE RELATIONSHIP STRATEGIC CO CAPITAL PROD OPERATIONAL

26

EXPLAIN HERE THE CURRENT STATUS

WINS strategy = current status

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= hard €

Yr 1

Yr 1

SET GOALS YEAR X = CURRENT WORKSHOP

20%

SKILLS

0%

40%

80%

CO

VE

RA

GE

Bronze Silver Gold

60%

WINS strategy = execution is key

• Uitspraak Bossidy: zie extranet

• Delivery of Individual objectives is key – monthly coaching sessions

– tools at your disposal via sipm.com

– colleagues

28

Purchasing Structure

Client Vision & Strategy

P u r c h a s i n g Mission

P u r c h a s i n g Strategy

P u r c h a s i n g Structure

P u r c h a s i n g Vision

Categ

ory

plan

Execution

Categ

ory

plan

Categ

ory

plan

29

Organisation

30

TYPE HERE CURRENT ORGANISATION STRUCTURE AND (IF APPROPRIATE) - FUTURE

Responsibilities in purchase process R&R

31

YOU MAY WANT TO EXPLAIN THE R&R PER FUNCTION: who does what?

Copyright 2008 SiPMwww.sipm.com

ACHIEVEMENTS 20XX

32

Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00 Catching-up Lunch

18.45 Refresh 13.30-14.00: 10. Wrap-up

19:30 Bar and dinner 14.30: End

33

Achievements 20xx

€ 2006 2006 => € 2007 LT SUPPORT

• Category x 100 K €

• Category y 60 K €

• Category z 400 K €

• … …..

• Total x K €

• Category x, y, z

• xxx

• Dashboard

• New people

• xxx

“WE HAD AN EXCELLENT AND BUSY YEAR”“WE HAVE INCREASED OUR CREDIBILITY”

34

BRAINSTORMING: USE FLIPCHART (EXAMPLE FOR CLIENT PREPARING 2007 OBJECTIVES)

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Achievements: external view

• tekst

35

TYPE HERE VIEWS FROM CEO, SUPPLIERS… (IF APPROPRIATE)

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Copyright 2008 SiPMwww.sipm.com

LEARNINGS 2006CONTINUE OBJECTIVES

36

Learnings 20xx

POSITIVE NEGATIVE (WHAT TO AVOID IN 20XX+1)

• xxx • xxx

Rank from important to less important

37

USE FLIPCHART

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Objectives to be continued

38

USE FLIPCHART

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Budget/expectations stakeholders

39

PUT INPUT FROM OTHER STAKEHOLDERS ON FLIPCHART

You may want to use the wall during brainstorming i.e. tape a roll paper on the wall and write down the results of the brainstorming.

Copyright 2008 SiPMwww.sipm.com

DAY 2SUMMARY DAY 1

40

Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00 Catching-up Lunch

18.45 Refresh 13.30-14.00: 10. Wrap-up

19:30 Bar and dinner 14.30: End

41

Summary Day 1

• Most important projects

• Objectives to continue

• Learnings

42

Copyright 2008 SiPMwww.sipm.com

INDIVIDUAL INPUTWORLD-CLASS QUESTIONNAIRE

43

Agenda Workshop

FIRST DAYPREPARATION

SECOND DAYCONSOLIDATION

13.45-14.00: 1. Welcome

Purpose Workshop (name)

08.30-10.00: 5. Consolidation objectives day 1

14.00-15.00: 2. Big picture: Purchasing Vision 10.00-10.45: 6. Brainstorming•Individual input•World-Class segments

15.00-15.45: 3. Achievements 20x 10.45-11.15: 7. Break – preparation by chairman

Break 11.15-11.30: 8. Assign objectives

16.15-18.00: 4. Brainstorming •Key learnings 20x•Objectives to be continued•Budget 20x (next year)

11.15-12.30: 9. Refine individual objectives

18.00 Catching-up Lunch

18.45 Refresh 13.30-14.00: 10. Wrap-up

19:30 Bar and dinner 14.30: End

44

Individual input

45

PERSONAL INPUT THAT HAS NOT BEEN DISCUSSED

World-class segments

46

DISCUSS QUESTIONNAIRE: NEW PROJECTS?

Copyright 2008 SiPMwww.sipm.com

APPENDIX

47

First price, than costs

Cost outCost downPrice downPrice drift Cost outCost downPrice downPrice drift

Tactical cost management Strategic cost management

Cost

Price

48

In your quest for better purchasing, first focus on price. Only after focus on cost.

current status

© John Hughes