Client:
Government of the United Kingdom
On the Web:
www.royalmailgroup.com
www.dvla.gov.uk
www.ogc.gov.uk/index.asp?/docid=2370 Project:
Electronic Auctions
Shortcut to
Business Challenge
How
Accenture Helped
High Performance
Delivered Executive Summary
By leveraging its eSourcing services, Accenture is working with the
Government of the United Kingdom, its agencies and companies to implement
electronic reverse auction (eAuction) initiatives that will reduce the cost of
doing business by measurably driving down procurement costs across public
sector organizations.
Using eAuctions to Drive Down Procurement Costs in the UK Public
Sector Client Profiles Royal Mail Group plc, a public limited company
wholly owned by the Government of the United Kingdom, has annual sales
exceeding £8 billion and more than 200,000 employees. Through its brands, Royal
Mail, PostOffice™ and Parcelforce Worldwide, it provides consumers and
businesses with letter delivery and express mail services that reach 239
countries and territories or 99.6 percent of the global population.
The Driver and Vehicle Licensing Agency (DVLA) is an
agency of the Government of the United Kingdom that helps to improve road
safety and law enforcement, collects vehicle registration fees and issues and
renews driving licenses.
Business Challenge Every year the companies, agencies and departments of the UK Government issue thousands of requests for proposals (RFPs) to companies wishing to secure government contracts. This process is mostly paper-based with mail, faxes and traditional couriers being used to deliver important documents required to negotiate contracts.
Because this traditional paper-based RFP process makes it difficult for
organizations to leverage their buying power among their supplier base—and
requires significant administrative effort—Accenture's Government group began
an eAuctions Program in June 2002 to educate UK public sector organizations
about how they could use electronic reverse auctions, or eAuctions, to achieve
savings deliver value for money to the taxpayer.
How Accenture Helped
The Police IT Organisation (PITO), an agency of the
Government of the United Kingdom, chose Accenture to manage and run the first
eAuction as part of a proof-of-concept project on behalf of the Office of
Government Commerce (OGC). The Office of Government Commerce selected Accenture
because of Accenture's thought leadership in eCommerce, its experience on
wide-ranging projects that leverage technology to improve government
efficiency, and its commitment to solutions that combine ease of implementation
with rapid return on investment.
Recently, two additional public service organizations, Royal Mail Group plc and DVLA, have successfully used Accenture's Standard Auction Service to reduce administration and procurement costs for goods and services while enabling multiple bidders to compete for business in open, transparent and fair eAuctions.
Accenture delivered the following to client organizations Royal Mail
Group plc and DVLA:
- Our Standard Auction Service, a secure, managed, hosted and
recorded eAuction that enabled open, transparent and fair competitive bidding
among multiple, pre-qualified suppliers via the Web.
- Seamless access to Auction Services, an Accenture Supply
Chain Management organization that conducts the eAuctions. Accenture has
conducted 1,500 eAuction events for client organizations worldwide and has
provided its more comprehensive Full Strategic Sourcing Service and its Speed
Sourcing Service to many others.
- Recommendations and training to aid understanding of the
appropriate conditions for using eAuctions.
- Proof-of-concept auctions for DVLA, including one that,
based on historical price, provided savings of 23.7 percent on a single lot of
security watermark paper.
- A series of proof-of-concept auctions for Royal Mail for
goods and services that included air freight and print services. Based on
historical price, air freight savings averaged 8.4 percent, while print
services savings—including services for campaign printing, promotional printing
and other high-volume printing jobs—averaged 42.7 percent.
- A flexible, cost-effective fee structure for managing and
conducting eAuctions.
How Accenture eSourcing Works
Accenture provides a range of electronic Sourcing, or eSourcing, services
through Auction Services:
- Full Strategic Sourcing Service
- Speed Sourcing Service
- Standard Auction Service
Accenture collaborated with the public sector organizations, Royal Mail
and DVLA, to provide eAuction services. The Standard Auction Service includes
the eAuction strategy, bidder training, technical support, eAuction hosting and
post-event reporting—all the tools, services and expertise a public sector
organization requires to enable multiple bidders to compete for business and to
assist with saving money.
High Performance
Delivered
Accenture's convenient Standard Auction Service enabled Royal Mail Group
plc and DVLA to respond rapidly to procurement needs, delivering significant
savings and reducing the time required to initiate and complete the procurement
process.
By leveraging Accenture's Standard Auction Service, these public sector
organizations were able to conduct pioneering, cost-effective eAuctions. To
simplify how eAuctions were conducted, Accenture worked closely with the
Government of the United Kingdom, assessing needs and training bidders, while
providing a secure, easy-to-use, fully hosted and fully staffed service.
A key endorsement of Accenture's Standard Auction Service came from Mike Killin, assistant director of the Office of Government Commerce. According to Killin, "eAuctions have a real role to play in delivering government contracts that offer the best value for money." Indeed, the significant savings achieved in the United Kingdom offer public service organizations worldwide a powerful example of how eAuctions can be implemented as a service, improving organizational efficiency, while offering the potential to substantially increase public sector savings.
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