Facing disruption alone will see limited successes. We needed to create a space to have a conversation, allowing us to use it as a catalyst for change.
Stanwell also realised its sourcing, tendering and invoicing processes were impeding suppliers, and they were building these inefficiencies into the contract price. Stanwell helped to secure greater goodwill from suppliers by introducing new tools, including e-procurement, source-to-contract, and procure-to- pay systems. As well has improving efficiency, the systems can offer up-to-date surveys of transactions and tenders as well as collating supplier satisfaction scores. “The process of buying and procuring will always be present in business. What we learnt was doing it quickly and efficiently; and allowing a space for ‘do-different’, shifted our position to being a ‘customer of choice’ across our supplier community,” Harvey says. Shifting the dialogue with suppliers Stanwell is benefitting from SRM, but it is careful not to use the name. Instead, it calls the process ‘key supplier management’. “It is a simple play of words that seems to have connected quite quickly with our managers, SRM is procurement speak we needed a business language,” he says. Harvey’s team is working through the process of putting contract management frameworks and supplier governance in place to make the key supplier management process more sustainable when personnel shift in and out of the business. To succeed with SRM in the long term, the organisation needs to get away from the idea that it is a task to complete, Harvey says. “It is not a spreadsheet to be done and then forgotten. Those SRM projects that prosper are those that do something with the results. It gives permission to shift the dialogue with suppliers.” Stanwell is showing how SRM can help organisations navigate changing industries. But creating the right moment to engage stakeholders was crucial to success.
product. Sometimes you need to have a conversation about that,” Harvey says. From its sample, Stanwell divided suppliers into five portfolios of mining, generation, ICT, materials and inventory, with a relationship manager in charge of each portfolio. Success through longer-term contracts One of the greatest successes came through renegotiating with one of Stanwell’s largest maintenance contractors. The firm had been working on an annual contract, which was rolled over each year. Following the SRM process it became evident that for the companies to work together with more trust and confidence a longer, and deeper commitment would be necessary. With this in mind, both companies approached a review of the contract with the overarching philosophy which says: ‘a contract is an act of community: what’s important for this community to pay attention to so it can gain the most from the contract?’ Consequently, Stanwell signed a four-year contract with the supplier, which enabled it to negotiate a deal that improved supply chain continuity and security while saving Stanwell AU$2 million. Though the real benefits continue to flow at contract engagement and management levels, the operating teams also enjoy a richer dialogue.
“The contract was a key to operations and maintenance. When both organisations truly
collaborated to the benefit of the contract, we were able to have a more forward view of what we could do differently. We’re now talking about optimising tasks and processes and having a better conversation around safety. The effect was immediate. The supplier was saying, ‘there were a whole bunch of things we had observed [we could do differently] but felt that we would not be listened to’,” Harvey says.
38 STATE OF FLUX
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