1. business and industrial
2. business operations
3. management
4. supply chain management

Purchasing Management Workshop
Grand Hotel, Waterloo, Belgium
October 11th and 12th 2005
Oriflame Purchasing Management Workshop
Module 1 – Introduction, Six Dimensions, Status, SWOT Task
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Introductions
Purpose
Workbook
Purchasing Six Dimensions / Challenges
Status
SWOT Task
Purpose of the Workshop
Purchasing Workshop Module 1
Individual & Purchasing Team Improvement
• Provide education on Strategic Purchasing to the Oriflame Purchasing Management team, in order to
support career development plans and team skill levels & effectiveness.
• Identify Oriflame Purchasing improvement opportunities, ensuring they are aligned with the Oriflame
business strategy and priorities.
• Develop the learning interactively in the workshop, so that there is ownership & applicability both
internally within Oriflame and externally with Oriflame suppliers.
Oriflame Business Improvement
• Further improve Oriflame supply side profit and cash, respecting AQSCI (Supply, Quality &
Regulatory, Service, Cost and Innovation) principles, thereby increasing Purchasing credibility and
reputation with Oriflame Leadership, Employees, Customers, Suppliers and Stakeholders.
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Attendees
Purchasing Workshop Module 1
Purchasing Management Workshop – October 11/12th 2005
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Edwin Koehler
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Maggie Taverna
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Luca Nanni
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Bruno Bastin
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Bernard Hensenne
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Francoise Beaujean
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Julien Bellanger
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Robert Connolly
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Brian Rolfe (To be confirmed)
2005-10-11
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Agenda
Purchasing Workshop Module 1
October 12th 2005 Session
October 11th 2005 Session
Time
Module
0830 – 1000
1. Introductions, Purpose,
Workbook, 6 Dimensions,
Challenges, Check List
1015 – 1115
2. Oriflame Business and
Purchasing Cost (P&L) and
Cash (Balance Sheet)
1130 – 1230
3. Current and Improved
Source Planning and
Supplier Management
Process. Six Sigma / Lean
1330 – 1430
4. Purchasing / Sourcing /
Project Team Development
1445 – Close
5. Data Gathering, RFI, RFP,
Market Evaluation, Supplier
Scorecards
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Who
Paul, Edwin &
All
Edwin, Paul &
All
Paul & All
Time
Oriflame Purchasing Management Workshop
Who
0830 – 1000
6. Sourcing Strategy &
Selection,
Standardisation,
Leverage, e Auction
Paul & All
1015 – 1130
7. Negotiation skills &
practice. Agreement
formation and
implementation.
All
1145 – 1230
8. Cebal Case Study and
how to improve current
and future year (s)
results. Sales &
Marketing Strategies.
Edwin, Paul & All
1330 – 1430
9. Supplier Management,
and Benefits Tracking.
Paul, Edwin & All
1430 – Close
10. Oriflame Purchasing
Management Plans.
Slide / Workbook review
Edwin, Paul & All
Paul & All
Paul & All
Module
© The Delos Partnership 2005
Workshop Presenter
Purchasing Workshop Module 1
Paul Warrick – The Delos Partnership Limited
Through global purchasing leadership roles with ICI PLC, Elementis PLC, Lonza AG, Crown Cork & Seal and Georgia
Pacific, Paul has acquired substantial Strategic Purchasing, Supply Chain and Business expertise and has a career track
record of delivering outstanding supply side value Improvement.
He has complete spend category and project management expertise and has recently led major supply side
improvement projects on Strategic Sourcing of Raw Materials with volumes in excess of 500,000 tonnes, Inventory
Reduction, Global Logistics & E Commerce.
Paul wrote the Delos Procurement Masterclass, containing all of the leading edge procurement & supply tools and
techniques, which has been delivered to numerous blue chip businesses. The Masterclass is based on both first hand
global Purchasing experiences in the Chemicals, Packaging, Paper, Coatings, Biopharmaceuticals, Adhesives & Metal
industries and the Delos approach. This recognises that the drive towards effective procurement will only be achieved
through engagement of all of the people across the functions – from Sales & Marketing providing accurate forecasts, to
Development innovating in a way that is integrated within an effective global Procurement Strategy, to working closely
with Operations, Supply Chain and Finance to ensure P&L spending and Balance Sheet cash & assets are optimized.
Paul has a chemistry & polymer science degree, is Six Sigma and World Class Manufacturing trained and has worked
with most of the big five and leading procurement consultants. Procurement support and advice has been delivered to
manufacturing, service and consumer companies.
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Workbook
Purchasing Workshop Module 1
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Oriflame data used in the workshop can be found in the
excel workbook.
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The Workbook also contains spreadsheets that can be
customised for individual or team use.
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Feedback on workbook improvements and further
development is required from each delegate.
2005-10-11
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Six Procurement Dimensions
Purchasing Workshop Module 1
6 Supplier Management – Relationships & Results
SRM
5 Negotiation & Agreements – Skills & Type
DEALMAKING
STRATEGIC SOURCING
PROCESS & TOOLS
COST, CASH & SPEND
LEADERSHIP & PEOPLE
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4 Strategic Sourcing – Process & Capability
3 Process & Tools – Awareness & Use
2 Cost, Cash & Spend – Management & Control
1 Supply & Procurement – Integration & Leadership
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Challenges
Purchasing Workshop Module 1
The Cost, Cash, Supply Chain & Inventory Challenge
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Inflation Up – Oil & Energy, Asia Demand, Market Consolidation
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Global Supply Chains – Asia Outsourcing by Europe & US
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Customer Expectations – RFTQ100%OTIF, Faster, Cheaper
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Shareholder Demands – More Profit, Higher Dividends
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Excess Inventories – Slow Moving / Obsolescence
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Purchasing – Check List
Purchasing Workshop Module 1
Leadership & People – Key Areas
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Purchasing Vision and Strategy – integrated with the Business
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Internal customer / business “Buy – In”
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Purchasing Capability & Management System
Cost, Cash & Spend Focus – Key Areas
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Focus on all key spend categories & suppliers
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P&L, Balance Sheet and Expense coverage
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Inflation (Cost) & Project Management
Process & Tools – Key Areas
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Integration with the ERP system / report
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P2P
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Sales Process (demand/forecast) understanding / management
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Purchasing – Check List
Purchasing Workshop Module 1
Strategic Sourcing – Key Areas
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Managed supply risk on key strategic / critical products & services
Innovation (New Product/New Source) Project involvement
Standardisation / Dual Sourcing + Leverage
Dealmaking – Key Areas
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Complete Agreement coverage (CDA to Supply/Service Level)
Negotiation excellence
Clear terms, price lists and optimised invoice / payment
Supplier Management / Benefits Tracking – Key Areas
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Complete supplier mapping / management
Self Monitoring suppliers (RFTQ100%OTIF) & Finance integrated savings system
Strategic Supplier partnerships
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© The Delos Partnership 2005
Low Capability Purchasing Example
Purchasing Workshop Module 1
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No evidence of valuable supplier partners in each business / region / plant
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No evidence of Supplier Management / Low RFTQ & OTIF
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Supply problems
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No evidence of agreements / price lists
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High Supply side inventories
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No recognition of the importance of Strategic Sourcing
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Limited bargaining power (sole source & size)
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No Standard Sourcing Process
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No Shared Service Centre / P2P system.
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Focus on Price / Cost only
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Uncompetitive prime materials pricing
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No clear Leadership – No Goals/Focus –Poor People – Not Lean!
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Workshop – Breakout Session
Purchasing Workshop Module 1
You have been asked make a 10’ presentation to the Oriflame Board on Purchasing
What went well – Where are the problems – Where are the opportunities ?
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Costs Reduced 
Fragmented Supply Base 
Supply problems 
No Standardization of Products or Services 
No understanding of / support for Central Purchasing 
Internal battles and politics 
Supplier Quality improvements 
Service improvements 
High Emergency Transport Costs 
Excess Stocks 
Innovation & Plants doing their own thing 
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Workshop Task – Guide
Purchasing Workshop Module 1
Use either / both the 6 Dimensions or AQSCI Pyramid in the presentation
SRM
Innovation
DEALMAKING
Cost
STRATEGIC SOURCING
Service
PROCESS & TOOLS
Quality/Regulatory
COST, CASH & SPEND
Assurance of Supply
LEADERSHIP & PEOPLE
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Delos Procurement Assessment
Purchasing Workshop Module 1
DELOS
ASSESSMENT
PROCUREMENTMASTERCLASS
DELOSPROCUREMENT
– Overviewcapability & valuable
Public
current procurement
DefinesCourse
improvement opportunities on Spend, Assets and Cash Flow
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Journey to Purchasing Excellence
Purchasing Workshop Module 1
Procurement – Value Gap Analysis
The Delos Partnership has assessed procurement capability and the value gap in businesses ranging from large multinationals through to S.M.E.'s, across all of
the spend & territory map and in many market segments. Procurement is now firmly established as an essential part of Supply Chain and plays a vital role in
global sourcing, supplier relationship and cost management strategies. We assess the capability of business procurement and how effective the business is in
leveraging its cost and spend on behalf of its customers to support of the business vision, strategies and goals. We assess performance against the six
dimensions of Procurement which cover leadership and people, internal and external customer performance, how spend & cost is managed, process capability,
strategic sourcing, leverage, dealmaking and supplier relationship management. This provides an independent and quantitative measure of how much year on
year net total value improvement is being delivered versus agreed goals & benchmarks and improvement opportunities in business profit , cash and service.
Benchmark
Bronze
Silver
Silver Gilt
Gold
Platinum
Leadership and People (Procurement Management System)
Cost, Cash and Spend
Process and Tools
Strategic Sourcing
Dealmaking
Supplier Relationship and Results Management
Bronze
Silver
Silver Gilt
Gold
Platinum
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= Entry level
= Developing
= Competent
= Advanced
= Expert
2005-10-11
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Score
Purchasing Assessment Results
Purchasing Workshop Module 1
Business & Customer Partnering
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Results Tracking
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Benchmarking
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Supplier Performance Management
Cost & Cash Management
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0
Dealmaking
Currency Management
Leverage Tools & Techniques
Risk Management
Sourcing Strategy
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Oriflame Purchasing Management Workshop
© The Delos Partnership 2005
Purchasing Workshop Module 1
Questions ?
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2005-10-11
Oriflame Purchasing Management Workshop
© The Delos Partnership 2005