|
| | outsourcing as a primary
business proposition in
this area.
“These days, the big
firms are focused on
multi-year deals that
drive tens or even
hundreds of millions in
revenue,” says Klein.
“Many clients have told
us that they feel that
the big firms will pitch
for a strategic sourcing
engagement, but will in
reality have their
sights set much higher,
typically on a
procurement outsourcing
deal or a large-scale
systems implementation
programme. This works in
our favour, because we
don’t have a broader
agenda: we want to
deliver on the piece of
work at hand, and we
don’t have an army of IT
consultants coming in
our wake. This also
helps when it comes to
providing advice on
e-procurement: again,
we’re independent. In a
way, we’re bringing the
concept of the ‘trusted
adviser’ back to the
procurement space.”
However, says Klein,
while clients felt
disenfranchised and to
some degree abandoned by
the big firms, they
nevertheless miss the
calibre and
professionalism of the
“blue chip” consultants.
“CPOs and procurement
directors still wanted
to engage people they’d
be happy to have
representing their
interests to
stakeholders around the
business - people that
could be trusted to get
the job done in a
professional manner
without embarrassing
them by being
insensitive to change
issues.” So when the
founders of Efficio | |
|
| | launched the firm, they
were determined not to
lose their blue chip
credentials and ethos.
“We’re very proud of
that and we really
didn’t want to change
it,” says Klein. “We
wanted to continue
working for large,
multi-national
organisations, because
it’s in those settings
that our people’s change
management experience
really makes a
difference. Also, the
economics of sourcing
are such that we can
give large companies a
much better return on
their consulting
investment.”
To maintain its level
of professionalism,
Efficio is very careful
when recruiting. It sets
the bar high, looking
for people who are
expert in sourcing and
supply chain
consultancy, who have a
number of years’
experience gained at one
of the leading global
consulting firms, and
who have outstanding
educational backgrounds.
“Our people need to have
strong procurement
technical skills but
where we really add
value is in problem
solving and change
management – and those
are the skills we look
for in a recruit,” says
Klein.
Efficio now has 49
people with offices in
the UK and Germany, and
a team that’s growing
its presence in the US.
“We don’t have
offices all over the
globe, but with 16
nationalities we have a
very international team,
and most of our people
can work anywhere in the
world,” says Klein. “We
used to be paranoid that | |
|
| | clients would insist on
their consulting partner
having a physical office
in every one of the
client’s locations – but
in reality, clients are
much more mature than
that now. They know that
what counts is the
calibre of the five or
10 key people on the
team, not the list of
global office locations
in the marketing
brochure.”
Efficio’s teams
habitually work
throughout Europe and
the USA. Right now, the
firm even has a
three-person team
working on a project
that covers South
Africa, Egypt, Nigeria
and Turkey.
“International
business is key to us,
and we are planning to
open more offices in the
long run,” says Klein,
“but we have done some
massive projects with
teams based in multiple
locations in parallel.”
As procurement has
developed so Efficio has
looked at taking it to
more strategic levels.
As companies become less
and less vertically
integrated, and not only
manufacturing but also
design activities are
increasingly outsourced,
procurement must become
more sophisticated.
“This will ultimately
require a radical move
away from what was once
termed ‘procurement’ –
purchasing over the next
20 years is going to be
about managing complex
external supply chains.
Where procurement today
is often viewed as
primarily a cost
reduction lever, in
future it will be a
critical value lever,
working with suppliers
to add value to the end | |
|
| | product, or even to
create the end product.
Put simply, the
things businesses buy
are getting more and
more complex. We’ve gone
from buying components
to sourcing entire
assemblies and even
finished end products
like TVs or PCs,” says
Klein. “The value in the
external supply chain is
getting bigger and
bigger.”
As procurement goes
deeper into the business
this means there is an
even greater need for
consultancy skills.
“What’s critical in
procurement is that you
can work internally and
get stakeholders on
board,” says Klein. “The
biggest part is the
change management piece.
Procurement is not just
about negotiating with
suppliers, it’s about
bringing a wide range of
often senior
stakeholders together in
order to successfully
execute a major business
change – and that’s not
easy”.
Klein says Efficio is
now on a “major push”
for growth, which has
manifested itself
through an aggressive
marketing programme
including a fundamental
re-branding of the firm,
and, more importantly,
through the appointment
of a number of sourcing
“heavy weights” at vice
president level. “Just a
couple of years ago, we
were concerned that
procurement as a focus
for consultants might be
dead – but it seems to
have come back with a
vengeance,” says Klein.
| |
|
| | By Mick James
Throughout the 1990s,
procurement was
something of a hot topic
in consultancy. The
attraction of driving
significant savings to
the bottom line without
incurring the pain of
head-count reduction or
major IT investments
proved a very attractive
value proposition, with
all the large consulting
houses developing an
offering in this arena.
But has the trend run
its course? Not
according to Alex Klein,
COO of sourcing and
procurement consultancy
Efficio. The firm was
formed in 2000 by a core
group of supply chain
specialists from A.T.
Kearney and Gemini
Consulting. The goal was
to create a specialist
firm that combined the
credibility of a large
consultancy firm with
the depth of expertise
and delivery focus of a
niche player.
“We found that
sourcing was maturing as
a market and that when
we went for pitches, the
‘big firm model’ — using
large teams of
relatively junior
generalists, day
rate-based pricing,
limited category depth —
wasn’t working any
more,” says Klein.
At the same time, the
big firms took their eye
off the ball when it
came to sourcing and
supply chain
consultancy, choosing
instead to pursue
business process | |
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