eircom is Ireland’s largest telecommunications provider, based in Dublin, with a turnover of euro 1.7 billion. It provides fixed-line telecommunications with 2.2 million access channels and mobile communications through its subsidiary, Meteor, the third largest mobile operator in Ireland. eircom Supply Chain is responsible for procurement for the whole eircom group
As the foundation of the transformation of eircom Supply Chain from transactional to strategic procurement, it was necessary to thoroughly and systematically review each of the contracts and supply agreements, and, depending upon the outcome of the review, ensure each is up to date, appropriate and delivering to the business requirements. The skills and methodology developed during this assignment was to be transferred to eircom resources and provide a core competency and discipline within Supply Chain.
To meet the aims of this assignment, ADR developed a bespoke process; the eircom Contract Review Process. The 410 contracts were segmented by value and criticality; and then either passed through a full review or a quick review. Each contract was assessed by a combination of ADR and eircom resources and quantified against six key criteria and 35 sub-criteria and a corrective action plan published for each contract. Over a period of 12 months, every contract was reviewed and every action plan implemented, progressively transferring the skills and capability to eircom resources, through coaching and hands-on support.
The eircom Contract Review process took contract coverage from 14% to 93% by volume and up to 96% by value, with all Strategic and Critical contracts reviewed, renegotiated and under management.
The discipline and methodology of contract assessment has become the foundation of eircom’s procurement function and is used in the ongoing management of suppliers. The bedrock of a solid supply base, completely under management has provided the bedrock for the procurement transformation process.
Category based opportunities unearthed and highlighted by the contract review process, led to standalone category projects. Supported by ADR, these opportunities delivered euro2.4M in savings
Bespoke contract review process built by ADR
Review all contracts and suppliers Skills transfer
All contracts reviewed, renegotiated and managed euro 2.4 million savings