FirstGroup is a leading transport group operating bus, coach, rail and tram services in the UK, USA, Canada, Ireland, Panama, Puerto Rico and India. With 115,000 employees, its five business divisions (First Rail, First Bus, First Student, First Transit, Greyhound) transport two billion passengers per year, generating approximately £5.3 billion in annual revenue.
Delivering Strategic Value Beyond Savings
As Head of Group Procurement for First Group, Glen Lovett is responsible for the function’s highly decentralized operations spread across the UK and the US. Glen and his 50 agents manage an annual spend volume of up to 50% of total revenue.
In the UK, each business has a procurement team. In addition, each rail franchise also has a procurement team focused on franchise bids, along with an IT procurement team. In the US, the group has a centralized procurement team.
Previously, Glen had to manage disparate operations, tools, spreadsheets and practices while trying to find new ways to generate savings due to cost pressures elsewhere.
“Procurement needs to save as much money as possible while ensuring governance aspects and organizational compliance, such as the prevention of child labor in cobalt mining for our batteries, ensuring we purchase electricity from renewable sources, or safeguarding against bribery,” said Glen.
Glen and his team were also very interested in figuring out how they could get people to work together to identify savings opportunities. For example, they wanted to know where they were using the same supplier and how they could get a better deal in these circumstances.
“When we were trying to track spend, measuring savings was very difficult,” said Glen. “Finance didn’t view our numbers as reliable, particularly our savings projections for the next year.”
His procurement agents were using different spreadsheets in different formats even though they had e-procurement systems in place. The gap was evident and the need to demonstrate procurement value to Finance and other stakeholders led Glen to search for a better tool.
Visibility On Day-to-Day Spend and Savings
Glen was instantly attracted by Per Angusta’s transparent sourcing pipeline as it provides day-to-day visibility beyond mere spend and savings tracking.
For Glen, Per Angusta was “very good value for the money” — largely because of its well thought-out automated sourcing pipeline made for day-to-day team collaboration and management agility. For just a fraction of the price of larger established vendor systems, Per Angusta demonstrated a real understanding of the procurement mindset and function.
His strategy was to use Per Angusta as their centralized system, integrating other agile systems within to gain visibility over the entire spend analytics and sourcing activities, all the way to contracting with real-time savings insight.
It was very important for Glen that the decision on Per Angusta would be supported by his heads of procurement. A demo led by Per Angusta founder and CEO, Pierre Lapree, convinced them of the solution’s value in delivering operational transparency, visibility and exceptional ease-of-use.
“Because Pierre has a background in procurement, he spoke our language, understood our real-life business challenges and matched the system exactly to our operating environment. The value of having an experienced procurement person creating a software solution must not be underestimated,” said Glen.
Elevating Procurement’s Role
Glen and his procurement teams use Per Angusta’s pipeline management module across First Group’s UK and and US operations.
They were able to sell it to their respective divisions to centralize and manage their day-to-day procurement projects on Per Angusta. As a result, they are now able to track spend and savings details for comparison and proactive management within and between teams.
“It has helped to facilitate more robust conversations between Procurement and Finance in setting annual procurement savings targets,” explains Glen. “And for the first time, we are able to provide procurement reports to the Executive Committee each month to show tracking against targets and forecasts. It has raised the profile of procurement in the organization and given our teams more visibility and credibility with management.”
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