Professionalised contract and partner management at Ausgrid

The situation – Inconsistent approach to contract and supplier relationship management

Ausgrid has a large decentralised contract management function with more than 150 staff responsible for getting best performance from thousands of suppliers. To align this function with the overall business objectives of achieving sustainable, reliable and affordable outcomes for its electricity customers it was necessary to introduce a consistent way for how contracts are managed.
Ausgrid further desires a more strategic approach to how its most important suppliers are managed –  with the aim of driving innovation.

The project – Defining a framework through collaborative design with the business owners

Grosvenor approached the project in a collaborative manner. From similar projects in the past we know that the actual challenge is not the development of the deliverables for this project but the change management required to change staff behaviour and drive adoption rates of the new way of doing things.

Grosvenor’s deliverables included:

• Delivered a business case for improvements of the contract management function, including current state maturity assessment, stakeholder expectations and change management required
• Completed Contract Health Checks of seven high profile contracts to baseline current practice and to measure improvements in the future
• Co-designed the contract management framework and partner management framework with more than 20 practitioners from Ausgrid who will be applying these frameworks day-to-day
• Developed 32 tools and templates to support practitioners in their contract and partner management activities
• Developed an extensive change management plan, including blogs for the intranet site to create awareness for the change
• Developed and delivered a comprehensive training module to uplift capabilities of more than 150 contract managers.

We approached the project by asking three questions: ‘Is it possible?’, ‘Where should we focus?’ and ‘How do we make it happen”?

A series of workshops and stakeholder consultations gave us the answer to ‘Is it possible?’. We made sure to understand what each stakeholder, including the procurement team and the heads of each business unit, expect from a successful approach to contract and partner management.

We then conducted seven in-depth contract health checks using our proprietary contract health check tool to understand where gaps to better practice exist. These further serve as a baseline to measure future successes against.

Finally, we developed the frameworks based on the understanding gained in this project and described how they can be implemented. We provided 32 tools and templates in addition to several checklist and intranet guidance to enable contract and partner managers do their job more consistently and effectively. We also developed an in-depth change management plan to describe how the frameworks can be made into reality.

The outcomes for Ausgrid  – Improved consistency in approach and outcomes

The project resulted in practical tools and guidance on how to drive more performance. From our research we know that the difference in supplier performance can be up to 29% improvement when the supplier relationship is well managed.

The available tools and the people capability uplift led to a common language and a more consistent way in managing contracts.

Ausgrid CPO, Coretta Bessi about the early benefits: “We have trained over 150 people across the business in the new Contract Management Framework and have received great feedback from our internal stakeholders.  Collectively we are working more collaboratively with our external partners, lifting the brand of Ausgrid and the profile of Procurement. The team at Grosvenor facilitated and engaged all procurement and business stakeholders throughout the project – the entire experience form initial engagement to handover has been pragmatic and professional.”

 

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