Procurement Strategy 2015 - 2017
This Procurement Strategy is consistent with and supports the University’s strategy and other policies and procedures including the Financial Regulations. Compliance with the Financial Regulations and Procurement Policy is mandatory; failure to follow it may result in appropriate action under the University’s disciplinary procedures.
The University’s procurement of goods, services and works will support the priorities set out in the University’s strategy in a number of ways, for example by:
- procuring research equipment and consumables in a cost effective and legally compliant way
- procuring appropriate external services to help to identify opportunities to exploit intellectual property
- procuring privately provided student rooms and managing contracts to build new student residences
- supporting the maintenance and re-development of the University estate
To ensure that the University’s faculties, schools, institutes and departments achieve value for money by procuring goods, services and works in a legally compliant, efficient and effective manner.
Value for Money
Value for money in procurement involves consideration of the following factors:
- The whole life costs of any purchase, including maintenance, consumables and disposal costs
- Non price factors, including quality and after sales support
- The effect of procurement on wider University activities.
The University is committed to achieving the following key strategic procurement objectives:
- Obtaining best value whilst minimising risk when procuring goods, services and works.
- Ensuring that all staff involved in the procurement process are equipped with the skills and receive the level of support appropriate for the financial level and strategic impact of their purchases.
- Building and maintaining strategic alliances with other institutions within the HE sector, relevant consortia, funding bodies and where appropriate organisations in other sectors.
- Minimising the costs of the procurement process by simplification of processes and the use of appropriate technology.
- Embedding the principles of sustainable procurement into the procurement cycle.
Delivering the Objectives
To help deliver the objectives the University will do the following:
Best Value and Risk
- Ensure that framework agreements for commonly used items are available, appropriately managed and readily accessible for departmental staff in order to maximise the University’s purchasing power.
- Ensure that all high value (>£75k) and strategic procurement projects involve timely consultation between departments and purchasing professionals based in the Procurement Department.
- Ensure that all contractual documents are reviewed by an appropriate person prior to authorisation.
- Ensure that suppliers are sound and reliable
- Ensure appropriate segregation of duties
- Comply with the University’s Financial Regulations and Procedures
Skills and Support
- Provide clear guidance to departmental staff through a dedicated website and other appropriate media.
- Make available a range of suitable training courses and additional professional support and assistance.
- Have representation on appropriate regional and national groups within the HE sector.
- Continue to develop links and explore collaborative procurement opportunities with local HE Institutions.
- Explore collaborative/partnership opportunities with other public and private sector organisations.
- Review and revise the processes involved in purchase transactions whether by purchase orders or by purchase card.
- Provide access to and encourage the use of an appropriate electronic tendering platform.
- Implement an electronic marketplace and investigate opportunities for process savings around electronic invoices by 2016.
- Work to reduce demand for goods and services by reducing waste and encouraging re-use and recycling.
- Encourage departmental staff to use lifecycle costing during procurement decisions.
- Promote and increase use of Fairtrade goods.
- Work with key suppliers to improve sustainability within the supply chain.
- Promote the use of local suppliers where appropriate.
In order to monitor procurement performance the following performance indicators will be used:
PI 1. Percentage of influenceable spend channelled through collaborative arrangements
PI 2. Percentage of orders placed electronically and via purchasing cards
PI 3. Percentage of influenceable spend actively influenced by procurement function
PI 4. Annual procurement savings as % of influenceable spend
KPI 5. Percentage of orders raised after the invoice date
PI 6. Number of suppliers used and level of expenditure with local suppliers per annum
PI 7. Number of new suppliers set up in the supplier master file
Influenceable spend is other operating expenses excluding:
- bursaries and scholarships
- Payments to other institutions, charities, schools, NHS (eg, franchised placements)
- Payments to banks, interest charges, etc.
- Payments to individuals (eg, staff costs included under the Op Ex category)
- Payments in relation to research council grants, doctoral training, research bodies etc.
- Provisions relating to pension costs and bad debts
- Payments to HMRC
- Membership and affiliation fees (including payments to professional bodies)
- Conference fees
- Rent and rates and planning fees to local authority
- Payment to students' union and trade unions
- Cost of student placements
PI 3 – Actively influenced is defined as either "controlled" (direct management of the actual procurement), "directed" (via a framework managed by the procurement function) or "delegated" (establishment by the procurement function of robust processes, procedures, guidance or advice against which the procurement is managed).
PI 4 - Procurement Savings will continue to be measured using the sector recognised rationale which underpins the EMM methodology. We will however continue to be strict in our interpretation of savings and to include only savings that we feel are fully justifiable.
PI 7 – Local suppliers are defined as those with a Liverpool postcode (L).