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Session Objectives

eProcurement The NHS Experience Scott Haldane - Director of Finance / Deputy Chief Executive NHS National Services Scotland. Session Objectives. Overview of eProcurement Scotl@nd NHS Scotland approach Local implementation experience. What IS eProcurement?.

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Session Objectives

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  1. eProcurementThe NHS ExperienceScott Haldane - Director of Finance / Deputy Chief Executive NHS National Services Scotland

  2. Session Objectives • Overview of eProcurement Scotl@nd • NHS Scotland approach • Local implementation experience

  3. What IS eProcurement? • Electronic tools that support and expedite the transactional purchasing process including: • The use of on line catalogues • Placing requisitions • Routing for approval • Sending to suppliers (Essentially it is a buzzword for doing procurement activities via the internet)

  4. What is eProcurement Scotl@nd? • Scottish Executive-wide initiative • A nationally negotiated subscription based service • Harness internet-based technologies • A step-change in procurement practice • An environment for more effective SRM • A flexible approach that can be adapted across the Public Sector

  5. PECOS PECOS PECOS ‘eProcurement Scotl@nd’ is designed to achieve: • improved process efficiency • improved Financial Control • Government eBusiness Targets Scottish Executive Suppliers

  6. PECOS is based on Remote Hosting • PECOS application hosted by Elcom in Boston, Massachusetts • No new hardware or software required • Only require a web browser • Can be accessed from anywhere within your organisation • Available 24 hours, 7 days a week • ‘Plug and Play’

  7. PECOS PECOS PECOS An opportunity for the NHS (and Local Authorities?) Scottish Executive Suppliers NHS Highland Suppliers NHS Tayside Suppliers

  8. PECOS PECOS PECOS Analysis of the use of the System Showed: …the NHS was using different suppliers for the same things… Scottish Executive Supplier A NHS Highland Supplier B NHS Tayside Supplier C

  9. PECOS PECOS PECOS Analysis of the system also showed: …even when we bought from the same suppliers, we bought slightly different things…or the same things at different prices… Scottish Executive Supplier A SE items & pricing NHS Highland Supplier B Highland items & pricing Tayside items & pricing NHS Tayside

  10. PECOS A bright idea - NHS wide items and pricing PECOS NHS NSS Stationery Supplier NHS items & pricing PECOS NHS items & pricing IT Supplier 1 NHS Highland NHS items & pricing IT Supplier 2 NHS Tayside Travel Supplier NHS items & pricing But, we need to link it in to other activities…

  11. The challenge… to improve procurement practice across the NHS BEST PROCUREMENT IMPLEMENTATION (BPI) ePROCUREMENT SCOTLAND (PECOS) BETTER BUYING (STRATEGIC SOURCING) PECOS LOGISTICS (Bulk Supplies to point of use)

  12. Impact of Strategic Sourcing approach: Supplier Supplier NHS NSS NSS items & pricing BETTER BUYING (STRATEGIC SOURCING) Supplier NHS items & pricing NHS Highland Highland items & pricing Supplier NHS Tayside Tayside items & pricing Supplier

  13. Benefits • Process efficiency • eAuctions • eTendering • Greater use of National Contracts • Strategic sourcing • Value for money from suppliers • Improved Financial Control • Government eBusiness Targets

  14. What PECOS is: • A system that provides: • content of products • requisitions to be created on-line • approval for spend on-line • automatic transfer of order to supplier • full audit trail • reporting suite • contract compliance • reduction in time taken to process documentation • reduction in overall lead time • reduction in stock required • reduction in paper records and hence stationery costs • improved query process

  15. What PECOS does: • Access to Supplier Catalogues electronically • Orders handled on-line • eMail • “Punch Out” • CXML However, this assumes that supplies are eEnabled….. a major risk for the programme!

  16. What PECOS isn’t: A Finance system …but is capable of integration to FMIS A Stock system… …this is being assessed at a national level An automatic link to a cost-centre budget… …but can be used to effect greater budgetary control.

  17. Next Steps: • Full integration to Finance Systems • NHS Shared Services • Purchase to Pay improvements • Link with Ward Product Management Systems • Support NHS Logistics • Inter-Agency Collaboration • Streamlined Public Sector procurement….

  18. eProcurement Scotland NHSScotland Blueprint Strategy Hamish Paterson NHSS ePS Programme Implementation Manager

  19. Context…. • The need to modernise Procurement and Supplies Management across NHS Scotland (NHSS) is widely recognised. • NHSS needs to adopt a more “corporate approach” to improve service delivery, leverage total spend and significantly reduce costs. • A key enabler for this will be the effective deployment of the right technology - The eProcurement Scotl@nd (ePS) service • The Blueprint Strategy proposes a planned and co-ordinated roll out of ePS which maximises the use of available resources across NHSScotland.

  20. A standard process for collecting and analysing the data from Health Boards was developed and followed…………. • Meet with Health Boards and agree the process to be followed • Data Collection from Health Boards • Data Validation exercise and review meetings with Health Boards • Summarise all Health Board data • Develop initial roll out/Blueprint strategy • Review proposed Blueprint strategy with all Health Boards • Sign-off and commitment to Blueprint by all Health Boards

  21. Data collected from Health Boards was subject to a number of limitations that need to be acknowledged… • Was a department fully implemented? • Were departments placing orders themselves or via Procurement? • Initial data was occasionally miscoded by users • There was some unmapped/obscure data that was difficult to define • Health Board resource availability to validate the data • Departments paying for goods/services did not necessarily instigate the purchase order

  22. Drugs • Income • Recharges • Rent & Rates • Capital Expenditure - New Buildings • Professional Fees and Services (50% of spend) • Telecoms (being reviewed) • Training Expenses • Travel & Subsistence (excluding leased cars) • Postage & Carriage • Utilities (being reviewed) • Transportation & Portering • Other Admin/Board Expenses • Waste Disposal • Publications • Subscriptions & Information Services Exclusions were agreed and the validated figures are in line with share of NHSS spend per Health Board…. Agreed exclusions from this phase Approx % share of national spend per Health Board In-scope expenditure for Health Boards based on 2004 data collected

  23. Department Roll Out Sequence takes the following Components of the Blueprint Strategy into Account…….. • Award of Strategic Sourcing Contracts & Contract Renewal and possible savings that can be made • Fitting in with NHS Logistics timetable for the implementation of Ward Product Management • Current approved HB plans • Rolling out to the same departments at the same time (or pilot first then roll out all other departments together) to aid easier central supplier adoption • Size of Spend • Stock Integration • Shared Services

  24. Blueprint Department Order for continued eProcurement rollout…

  25. Agreed Key performance indicators have been set up to measure the success of the implementations by Health Boards…….. • Key Performance Indicators • Percentage of In-scope spend covered • Value of transactions against target spend with respect to local project plan • Statistics that will also be tracked, although not measured against • Volume of transactions • Split between Level 1 & Level 2 catalogues • Number of suppliers adopted vs suppliers identified in local supplier adoption • Users trained vs planned for departments (estimate) • Active vs Registered Suppliers • Active vs Registered Users • Break-down of Supplier Content by catalogue, non-catalogue, punch-out • Break-down of Order Routing by fax, email, cXML

  26. Agreed Health Board Targets…

  27. What do we have…. • An Agreed roll out strategy signed up to by all NHSS Scotland Health Boards • A Roll out plan that co-ordinates the efforts of the national and local resources and effort • Agreed KPI markers that are common to all organisations and are deliverable to the Scottish Executive • A co-ordinated plan that takes into account the needs of local and national initiatives

  28. Everything you wanted to know about an eProcurement implementation (but were afraid to ask) Peter Shinton Project Manager- eProcurement NHS National Services Scotland

  29. Scottish Executive Initiative- Scott Scottish Executive Initiative- Scott NHS Initiative- Margaret NSS Initiative

  30. Contract compliance £ Make strategic sourcing decisions Process improvement Accurate information, produced quicker What’s the theory?

  31. Nothing on PECOS that shouldn’t be Info for this still from Fin Systems “Do I have to raise an indent…?” Easy to keep tabs on progress and the practice? Contract compliance Process improvement Accurate information, produced quicker Make strategic sourcing decisions

  32. Contract compliance Process improvement Accurate information, produced quicker Make strategic sourcing decisions Ensure only contract suppliers and items are adopted Monitor all transactions through existing methods to ensure non-contract purchasing isn’t continuing What are you trying to improve?

  33. Contract compliance Process improvement Accurate information, produced quicker Make strategic sourcing decisions Ensure the commodities are suitable for eProcurement Don’t add complexity / bureaucracy to the processes Making today’s processes electronic doesn’t automatically improve them! What are you trying to improve?

  34. Make strategic sourcing decisions Contract compliance Process improvement Accurate information, produced quicker Decide what you want the information for Should you push ALL transactions through the system, or are you targeting particular commodities? What are you trying to improve?

  35. Contract compliance Process improvement Accurate information, produced quicker Make strategic sourcing decisions Ensure you obtain the information you want Ensure you have the opportunity and ability to make use of the information What are you trying to improve?

  36. To snatch defeat from the jaws of victory, you must ensure you have no… • clear implementation strategy • dedicated resource • defined scope or end point • clear responsibilities • …amongst other things! • An implementation is a project • but • ongoing system use belongs to the business

  37. Thank you for listening Any questions? Peter Shinton Project Manager- eProcurement Corporate Programme Office ( Tel: 0131 275 6769 (Internal No 6769) + Email:peter.shinton@csa.scot.nhs.uk NHS National Services Scotland, Gyle Square, 1 South Gyle Crescent, Edinburgh, EH12 9EB

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