Royal College of Music

Procurement Academy: Case study

The Royal College of Music has long been a member of LUPC, however, take up of LUPC frameworks was low. In 2008/09, 2% of non-pay spent was through LUPC and other collaborative arrangements. Since August 2009 the RCM has changed procurement arrangements and in 2011/12, 20% of non-pay spend was through collaborative arrangements. During this period we have implemented simple procurement procedures and facilitated staff attendance at LUPC training sessions. We started by “picking from the low hanging fruit”, focussing on large contracts in estates; facilities management and ICT. We have brought in collaborative arrangements for a number of key contracts and the major ones are shown below in the order in which each area was reviewed.

  1. Catering

The RCM operated a loss making catering contract with an outsourced supplier. We reviewed various options and decided to tender for catering and included among the bidders our next door neighbour, Imperial College Catering (ICC). Because of the convenient location, the scale of their existing operations and their expertise in university catering they provided the best value for money option. Because they were a university catering department, ICC understood our needs and our service levels increased significantly, whilst at the same time costs were cut. Cash saving from collaboration c.£70Kpa. However just as important was the marked improvement in customer service and high levels of customer satisfaction; ICL have a strong quality control ethos and a clear knowledge of the university sector.

Actual savings were higher as previously support staff had to buy some catering from other local providers, this no longer occurs, but we have not quantified savings in staff time. This successful collaboration, gave members of the RCM that collaboration was a good way to go.

  1. TEC

Prior to 2009, the RCM procured gas and electricity on its own. We joined TEC in 2010 and have benefited from sector-wide procurement arrangements. This has given us a lot more confidence in our buying arrangements and also provided the facilities team with greater experience in buying these commodities. TEC also gave us cost effective access to “Green Energy” which has helped with our environmental strategy (The College was the first small HEI to be awarded The Carbon Trust Carbon Certificate). Savings are difficult to quantify savings as prices fluctuated and we have cut usage by c.10%pa. Probably c.£20K pa.

  1. Computing and telephony hardware

Prior to 2009, we did not as a matter of course use LUPC frameworks for procurement of computing and telephony. We now procure routinely from the frameworks and make use of the knowledge of the LUPC contract manager.

LUPC also provided us with access to GPS frameworks when we were replacing our telephone system. It is difficult to quantify savings on hardware procurement, but we project savings c.£30K pa on running costs.

  1. Cleaning

Prior to 2009, the RCM did not use the LUPC framework for cleaning and we employed two different companies for our two campuses. In 2010, we commenced discussions with the Royal College of Art and Heythrop College (neither used the LUPC cleaning framework) about forming a cleaning consortium under one management contract to go out to tender using the LUPC cleaning framework; by putting together our three “small contracts” we tendered a contract worth c.£2M over three years. With LUPC’s support we awarded on the LUPC framework.

The three colleges manage the contract jointly, which means that if one of us is unhappy we are all unhappy (we have much more muscle together than alone). Savings for all three colleges were substantial; the RCM saved c.£50Kpa (£20K of this was because of a shared management contract).

We have recently retendered the contract and we paid for an LUPC contract manager to manage the tender. We anticipate achieving further efficiencies and savings on the new contract.

  1. Estates maintenance

Because of the expertise and confidence obtained from previous tenders, our Head of Estates joined the LUPC working group to establish Estates Maintenance Framework Agreements. The RCM was one of the first LUPC members to utilise an estates framework for our summer works 2012. The contract involved refurbishing and refurnishing most support department offices and moving more than 70 members of staff in order to accommodate an extra 20 staff on our main campus. We used an estates framework and an office furniture framework and set new standards for office accommodation. Staff were involved in the move, by giving all those involved choices as to furniture (all from LUPC frameworks), flooring and colour schemes. Only two support departments were not moved and they have both asked for their offices to be upgraded to our new standards. It is difficult to ascertain savings, however, employing organisations who are used to servicing universities made the process easier to manage for our internal estates team. Overall this project allowed us to give up the lease on office accommodation with savings of £150,000 pa.

The RCM does not have a dedicated procurement manager; we rely on heads of department to procure goods and services. To support change, staff are encouraged to attend LUPC CPD days and the Director of Finance and Estates includes procurement as a discussion item on his management team awaydays.

  • Since 2009, the Head of Estates has led a number of collaborative procurements and has attended a number of LUPC run programmes to gain knowledge of subjects such as EU tendering and TUPE implications of changing service providers. He also joined an LUPC working group which helped to gain a broad understanding of how framework tenders worked.
  • Our Maintenance Engineer plays an important role in estates procurement and knowing the importance the College placed on good procurement, requested training in this area and attended a general LUPC day on procurement.
  • The Assistant to the Finance Director is leading on our GEM implementation and requested attendance at a general LUPC day and also specific GEM training. She also leads on our insurance tendering (through LUPC) and had attended training days in this area.
  • The LUPC computing framework manager came to the College to meet with our ICT staff to work through how we might make more use of LUPC frameworks.

In no case was attendance at training compulsory and in most (if not all) cases the initiative came from the individual. This interest has arisen by the College putting procurement at the heart of our financial systems. We have a long way to go to embed collaborative procurement throughout the RCM, however, the Senior Management Team are all fully on board and committed to meeting the Diamond objectives (we expect to achieve the 30% target within the 5 year framework). The RCM’s commitment can be seen from the Collaborative Procurement Statement included in in our public Annual Financial Statements in each of the last three years. Since 2009 we have increased our collaborative spend from less than 2% to more than 20% in 2012. At the RCM we measure all our savings in musical instruments and we estimate that our savings from increased collaborative spend are equivalent to the cost of three Steinway B Grand Pianos per annum (each Steinway B costs c.£60,000).

Next steps

  • tender jointly with the Royal College of Art on the LUPC security framework
  • replace numerous estates FM contracts with one contract drawn from LUPC frameworks
  • develop a College-wide procurement strategy;
  • review LUPC frameworks, ascertain which are pertinent to us and challenge managers to adopt them;
  • undertake a PMA;
  • develop the GEM system in the College as a natural place for procurement by managers.