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L4M6 Case Study FINAL

The cross-functional team was tasked with renewing the catering contract for a staff restaurant at a large utilities organization. When initially meeting, team members expressed varying opinions on the options for the contract. After discussions, the consensus was reached to renew the existing contract. The team identified stakeholders, including employees who had high interest but low power. Multiple suppliers met the criteria, giving the organization more bargaining power during the tender process. Early supplier engagement allowed input on potential efficiencies before bids were submitted.

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550 views4 pages

L4M6 Case Study FINAL

The cross-functional team was tasked with renewing the catering contract for a staff restaurant at a large utilities organization. When initially meeting, team members expressed varying opinions on the options for the contract. After discussions, the consensus was reached to renew the existing contract. The team identified stakeholders, including employees who had high interest but low power. Multiple suppliers met the criteria, giving the organization more bargaining power during the tender process. Early supplier engagement allowed input on potential efficiencies before bids were submitted.

Uploaded by

Abdallah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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L4M6 Supplier Relationships

Case Study
Jean-Luc works at a large utilities organisation. He is representing the procurement department
in a cross-functional team that was set up to discuss a catering contract. To date, the
organisation has provided a staff restaurant in the site. The contract is up for renewal and the
organisation wanted to engage with the employees to determine what to do next.

When the team initially met, there were introductions, and a period where they were finding out
about each other. Once the team had settled somewhat, people began putting forward their
opinions, which varied from having a subsidised canteen, to suggestions that there was no need
for a canteen and people could bring their own lunch. It got quite heated at times. Jean-Luc
observed his team members – some were very vocal, and seemed determined to have their
opinion be the outcome, others gave their views when asked directly, but sat back and
disengaged from the process. Eventually a consensus was reached that the contract should be
renewed.

Early on, the team identified the stakeholders, and categorised them according to their level of
power and interest. One group they identified was the employees who worked in the building.
The team categorised them as having a high level of interest, but a low level of power.

The team worked together to identify appropriate suppliers who had the capacity and capability
to provide the services. There were several suppliers who met the criteria; many more than had
been available last time the contract was put out to tender to find one supplier for the contract.
This was an advantage for the utilities organisation.

They invited the suppliers to come in and consider the layout and facilities of the existing staff
restaurant.

At this stage, the team also considered the relative spend of the contract compared to the size
of the supplying organisations, and used the supplier preferencing model and market
management matrix to identify which suppliers would view the contract most favourably.

The contract was put out to tender. Everyone had a clearly defined role and they executed their
own tasks. When bids were received, the team worked together to evaluate them – each taking
responsibility for assessing a specific section in order to achieve the goal of identifying one
supplier that was best placed to provide the service.

Leading global excellence in procurement and supply


Use the information provided in the case study to answer these questions.

1. What was the reason for the termination of the incumbent contract?
a) Poor performance
b) The end of the contract
c) Supply base rationalisation

2. Where does ‘single sourced’ sit on the relationship spectrum?


a) At the competitive end
b) At the collaborative end
c) In the middle

3. There are four options for how a supplier might view a buyer. Which quadrant is best for the
buying organisation to be in?
a) Exploitable
b) Core
c) Development

4. Why was it advantageous for the utilities organisation that there were more potential
suppliers this time around?
a) Increased competition among suppliers means suppliers have higher bargaining power.
b) Increased competition among suppliers means buyers have higher bargaining power.
c) Increased competition among suppliers means buyers have lower bargaining power.

5. What method of communication should the team have adopted with the employees, based
on their stakeholder categorisation?
a) Minimal effort
b) Keep informed
c) Keep satisfied

6. When the team was working together to identify appropriate suppliers, what stage of team
development would this have been?
a) Forming
b) Storming
c) Performing

7. When the team members were giving suggestions about how to proceed, what types of
behaviour did Jean-Luc observe?
a) Competitive and avoidant
b) Competitive and accommodating
c) Compromising and accommodating

8. What benefit did early supplier engagement bring to the utilities organisation?

1
a) Allowed the suppliers to see where they would be working
b) Allowed the suppliers to see what facilities were available
c) Allowed the suppliers to suggest improvements and efficiencies

2
Answers
1. b) The end of the contract
2. c) In the middle
3. b) Core
4. b) Increased competition among suppliers means buyers have higher bargaining power.
5. b) Keep informed
6. c) Performing
7. a) Competitive and avoidant
8. c) Allowed the suppliers to suggest improvements and efficiencies

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