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into where the business is going rather than have the business fit into my procurement strategy . The basis for the procurement transformation started at the most senior levels with our executive team – they saw some opportunities and green shoots in areas that they scratched in the twelve months before I arrived .” Nevertheless , supply change management was not as mature at Delaware North as he had been used to at Coles or Qantas – multi-billion-dollar companies with a highly advanced procurement function – and very commercial in the way that they go about managing suppliers .
But these large ASX companies could also be onerous . “ I came in with the view of bringing the best of what I have done previously in bluechip environments while avoiding the things I had identified as slowing those cultures down . The environment that I identified when I came here was a traditional supplier model . We ’ d engage suppliers without any long-term commitment , negotiating discounts and the like , but with very little true marketing engagement .”
The first partnerships Lorenzin forged were internal . After launching a three-year analysis of value in every corner of the supply chain ( the first pillar of his transformation ), he looked at how procurement engaged with the operational side of the business . This necessitates a broad cultural change , he believes . Rather than making sourcing decisions centrally and asking the management of sites to live with them , Lorenzin started to invite operations to make their preferences known . “ There was an opportunity to increase two-way dialogue and give operators the chance to share input . I was saying to key operational partners , ‘ You will have a voice more than you ’ ve ever had . However , it will be structured .’ We have been very clear as to what we will be sourcing from the market and where we will be seeking their input .”
Procurement , he says , is the magnifying glass that draws together the expertise across the business , concentrates it and obtains the best outcome for the business . The Pareto rule applies : 80 % of the total spend
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