Frozen Food Wholesaler

SI Selection & Contracting For Major SAP Program

Background

The Client is a wholesale company supplying food, drink & catering equipment mainly to the restaurant & catering industry in the UK, Sweden & France. It provides merchandising, inventory management & contract logistical services to corporate, national & independent channels. This private-equity owned organisation had decided to launch a major business & IT transformation program to deliver a next generation platform to grow the business and integrate the multiple brands & business units acquired over the past 12 years. The program included an SAP driven transformation program covering business process, IT applications, infrastructure & networks.

The Challenge

  • The Client was selecting an SI for a major SAP driven transformation program
  • However, the procurement team, although experts in direct (food) procurement, did not have the latest market intelligence or experience with best practice method for procuring SI services for business and IT change
  • Given the significant capital spend, the Client had to be sure they negotiated the best commercial terms and achieved a maximum risk transfer in the contract, especially to avoid cost over-runs
  • Finally, the Client also had to be sure that the contract captured the target deliverables and provided adequate protection towards achieving the program outcome

Searchlight Role

  • Searchlight were engaged to advise and manage the selection and procurement of the SI services
  • Searchlight ran a highly creative evaluation & selection exercise to rapidly evaluate 4 different SI’s
  • Searchlight put in place an efficient procurement process, engaging stakeholders in procurement, legal, business and IT
  • Searchlight crafted the commercial negotiation strategy with day-rates and charges benchmarked with comparable SIs and required skill levels
  • Searchlight worked closely with the program leadership to draft & review the statement of work to ensure that it reflected the outcomes desired

Value and Benefit Delivered

  • We enabled the program Sponsor to recommend the chosen SI with confidence & insight into what it takes to actually manage them
  • The Master Services Agreement and Phase 1 contract were negotiated by us, and signed, inside 2 month (within the target timeframe and helping to limit legal costs)
  • Through the commercial negotiation the Client was able to reduce the cost of the project by 14% and also limit future permitted inflation adjustments.
  • The client implemented a new rate structure that would allow easy benchmarking across other suppliers and market competitors
  • The contract provided the Client the control to manage the program and protect against a situation of unacceptable delivery