The issue
- Frontline ‘negotiators’ not trained – Teams lacked clarity on effective, strategic negotiations
- Power balance leaning to suppliers – Although the airport had leverage, suppliers secured favourable contract terms
- Costs above benchmark – Costs were identifed as 20% to 40% above benchmark for critical success
Solution
- Benchmarking & Research
- Gained clarity on the as-is situation. Conducted supplier forum
- Build Strategy
- Tenders, direct negotiations, demand management
- Deliver Negotitations
- Reduced costs, and aligned supplier contracts with strategic goals
- Train Stakeholders
- Equipped them with best practices to ensure long-term value in contracts
- Operating Model Change
- Ensured cost savings are locked in the organisation for the long term
- Build Future Roadmap
- So the organisation can use the training and model to deliver further savings
The results
- Training and Development of Client Team
- Empowered the client team with strategic procurement and negotiation skills, resulting in more balanced contracts and enhanced decision-making capabilities
- Client – Supplier Power Dynamic Changed
- Rebalanced power dynamics, shifting leverage back to the client and achieving more favourable contract terms
- Cost Reductions Delivered
- Achieved over $7 million (AUD) in savings and improved negotiation outcomes by up to 50%
