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Procurex Keynote: Colin Cram

Monday February 2nd, 2015
Colin Cram

Colin Cram

Firing the starting shot of the 2015 Procurex Live conference season is Colin Cram, the procurement expert who is chairing both Procurex North and South Live 2015. Here, Mr Cram casts his mind over procurement and the public supply chain, reflecting on the challenges of past and future years.

Mr Cram’s procurement career started in 1980 when he joined the equivalent of today’s Efficiency and Reform Group. He was given the task of examining government stores and stockholdings and undertook 35 reviews of procurement organisations in the public sector and 12 in the private, making efficiency recommendations to the Central Unit on Purchasing (CUP).

While making his recommendations, Mr Cram noticed that there was widespread supply order duplication in public sector buying.

He said: “I quickly realised that inadequate procurement was causing massive supply overstocking, wasting several billions of pounds in early 1980s money.”

Attempting to tackle this problem, in 1985 Mr Cram started procurement collaborations across eight government departments, while developing the procurement training programme at the Civil Service College (an establishment he co-founded in 1983).

In 1988 Mr Cram moved to the then Department of Health and Social Security, identifying and establishing projects to tackle major monopoly supply situations. He noted that the biggest challenge facing public sector buyers was gaining cross-department support.

He said: “Getting consistent internal support was more difficult than tackling the markets; this is something with which all procurement people can identify.”

To shake up the bureaucratic image of procurement, Mr Cram set about creating the most powerful contracting team in central civil government. The Department of Social Security (DSS) team consisted of 65 members and operated in a devolved environment of 1000 independent cost centres.

Mr Cram said: “There were some exceptional people in that team who taught me a huge amount. Through hard work, we won over the customer base and saved about £50m annually, on a repeat spend of £300m.”

To continue these savings, Mr Cram championed the consolidation of procurement authorities to further streamline buying. He did this by becoming the first director of the North Western Universities Purchasing Consortium and creating a joint procurement organisation for the research councils. The consortium proved the benefits of a single expert procurement organisation to independent public sector bodies.

After this role Mr Cram went on to become Director of the North West Centre of Excellence, covering 47 local authorities.

He said: “My experience here confirmed the commonality of procurement spend throughout the UK public sector and the need to restructure its management.”

This role then led to Mr Cram’s recommendation to the House of Commons Public Administration Select Committee, in January 2013, for the creation of the Crown Commercial Service.

Mr Cram reflected that the challenges facing public sector procurement have changed greatly during his extensive procurement career. Some ‘recent’ changes include: the introduction of PFIs in 1989, an increase in outsourcing, greater complexity of ICT supplies and the globalisation of procurement.

Although the trends have changed, Mr Cram has noticed procurement officials often make the same mistakes.

He said: “Our unwillingness to manage spend coherently puts us at the mercy of supply chains. Procurement cycles focus mostly on the end suppliers and often take too fragmented an approach.

“If that was how major and global private sector companies operated, they would soon be out of business. Too often procurement reacts belatedly to changes rather than taking the lead.”

Despite this, Mr Cram is positive about the future of procurement.

“There are some great initiatives in all parts of the public sector; through organisations such as the Society of Procurement Officers (SOPO) procurement is increasingly taking ownership of changes needed.”

He continued to predict that, with austerity, government will shrink, causing contracting to become both more complex and transparent.

“Procurement will increasingly be seen as key in developing UK suppliers, apprenticeships and jobs. Commercial thinking will become ingrained in the DNA of the public sector and combined authorities will become the norm for the UK’s major cities.”

This challenge – Mr Cram explained – will be teamed with growing outsourcing competition from developing nations, such as those in South East Asia.

He said: “35 years ago, public sector procurement was for those who wanted a quiet life. Now, if you want a quiet life, it is something to be avoided. This is why Procurex is so important.

“Procurex attendees can learn from the best of private sector procurement personnel and engage in a debate about the changing environment.”

For further information, visit the Procurex Live website.

 

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