Procurement

We recognise that many areas of procurement continue to raise concerns amongst suppliers and have a number of workstreams across the business to improve this.

We are introducing sourcing managers across the business who will be the main point of contact for the sourcing of that particular categories of spend whether it be goods, works or services. The aim of this is to provide a strategic approach to sourcing and to give consistency within each category. It is also designed to share good practice, to make the most of innovation and to forecast demand.

The ‘Strategic Sourcing’ programme, which started June 2006, continues to be rolled out. Its objective is to ensure that consistency and excellence exists across the company in relation to all supplier related commercial matters. To date the project has developed standard processes, templates and supporting systems and it is on target for company-wide adoption by December 2008. A significant upskilling programme has also commenced as part of this project to ensure that the Sourcing professionals have the required competencies.

Network Rail launched its new standard suite of contracts in June and has been progressively increasing its use of the new forms when procuring new goods, services and works. Our aim is always to receive bids compliant with our terms and conditions and generally this is being achieved, but as one would expect with any new suite of contract documentation, in some cases this has involved considerable discussion regarding the requirements of the contracts. However, there are signs that these teething troubles are settling down.

As a result of a number of tender discussions we have made some changes to our original documentation to address risk, uncertainty and market conditions, and amended contracts have recently been posted on the website.