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GuidelinesSupplier RelationshipManagement Guidelines(SRM)PwC Middle East ProcurementTurning relationships intopartnershipsDecember 2019
Introduction1Ensuring PwC receives the bestvalue and quality from our supplychain through strategic sourcing isa priority for the firm. As PwCfurther outsources its non-corecompetencies to third parties, weunderstand that working inpartnership with our strategicpartners is a key factor in terms oftechnology, innovation, security,corporate and social responsibility,cost savings and achieving valuefor money.This document has been designed to guide you, our strategic partner, on our‘Supplier Relationship Management’ (SRM) programme and emphasise thefundamental message that ‘our strategic partnerships are a key component toPwC Middle East's success’.This programme will help to promote a structured framework that focuses onthe following core elements of SRM:1.2.3.4.5.Regular engagement meetings between all key stakeholders360 degree performance evaluations which provide a safe environmentwhere constructive feedback can be gathered from both partiesAnnual contract reviews to ensure the contractual terms are fit forpurpose and promote value engineering and the introduction of newinnovative approachesIntroduction of a governance hierarchyPromoting excellence by highlighting new areas of value engineeringand the introduction of new initiatives.Supplier Relationship Management l Page 2
As PwC strives towards being a ‘client ofchoice’, our new ‘Supplier RelationshipManagement’ framework provides thebuilding blocks required in order to developa truly strategic partnership approach withall key vendors across the region.Within this document you will be able to find anoverview of the framework, understand whythis programme is important to PwC, how theprogramme will benefit you as a strategicpartner and what is required from both partiesin order to successfully implement the processand build on our current relationship.Supplier Relationship Management l Page 3
Turning Relationships intoPartnerships2Why does PwC have a ‘SupplierRelationship Management’ programme andwhat is the aim of the programme?Evolving our business togetherAs PwC further outsources itsnon-core competencies to thirdparties we understand the importanceand reliance we have on our supplychain in terms of innovation, security,risk management, corporate andsocial responsibility, cost savings andachieving value for money. As the roleof the Procurement Departmentmatures within the region, werecognise that holding our vendors atarm's length is not an option. In orderfor us to achieve ‘true value’ throughour sourcing process we need toensure that our relationship withselected strategic partners does notcease once a contract has beensigned but evolves through thecontracting lifecycle.Our Supplier Relationship Managementprogramme allows both PwC and ourstrategic partners to work in collaboration,build trust, encourage open and honestcommunication and promote the use ofexisting & emerging technologies throughcollective management of theprogramme’s performance and regulardialogue that encourages improvements inefficiency and effectiveness.Supplier Relationship Management l Page 4
Mutually desirable benefits ‘Widening the Perspective’PwC recognises for both parties to prosper, a mutuallybeneficial long term objective needs to be agreed which willheighten engagement and performance and push theboundaries of a traditional client / third party vendorrelationship. Through the creation of this policy, we aim towiden the procurement perspective to ensure that all areas ofthe agreement are considered, not only at the initial sourcingstage but also during the contract lifecycle. This will promote aculture which encourages both firms to look for new areaswhere value can be reimagined. These areas may include: Introducing new technologiesDeveloping leaner and more efficient processesManaging new and developing risk profilesEnsuring compliance with changing governmentregulationsMaximising tax benefitsReducing unnecessary wastageChallenging the status quoSupplier Relationship Management l Page 5
How will the programme benefit yourcompany, as a strategic partner to PwC?In today's world many organisations encounterdifficulties in initiating, developing and managingthird party relationships. At times stakeholdersinvolved in the contracting process on both sidesfail to understand how partnerships can aid anorganisation in driving long term competitiveadvantage.PwC’s ‘Supplier RelationshipManagement’ framework has beendesigned to promote transparencyand open communication betweenboth companies throughout thewhole contracting lifecycle. This isachieved through a predefined setof Service Level Agreements(SLAs), which are created withstakeholders, including our supplychain partners, and designed tohighlight areas of excellence andimprovement to all parties. TheseSLAs will help us both to track thecontract’s performance, discusswhat we do well, highlight areas ofimprovement and implementchanges during the contractlifecycle. At the same time, adetailed contract review will becompleted to ensure that bothparties are keeping up to date withnew and amended legislation, thatareas of innovation andtechnological development areimplemented and relationshiphierarchies reviewed. This will helpto ensure our strategic partnershipremains relevant and evolves withthe market.Supplier Relationship Management l Page 6
3The SRM FrameworkWhat is expected from us as a strategicpartner?The FrameworkOur ‘Supplier Relationship Management’’ programmehas been designed to ensure that PwC work incollaboration with our supply chain. The programmeincludes a structured framework which focuses on thefollowing core lement1423360DegreeSLAsRoadmapcreationThe process definedAs a general guideline, all strategic partners will be required to contribute to all fivestages of the process as detailed above. It is important that both parties are engagedthroughout the process to ensure that performance is measured in a fair and openmanner which best represents the goods or services being delivered by you to PwC.Supplier Relationship Management l Page 7
Governance hierarchyThe below governance hierarchy provides an overview of the engagement sessionsPwC will hold with our strategic partners during the contract lifecycle. The frequencyand depth of the meetings will depend on the criticality and complexity of the goodsand services being offered.As a minimum, a 6 monthly meeting and an annual review will be conducted with allstrategic partners. For those services which are considered business critical andinclude a high volume of operational delivery, a monthly meeting will be held followedby a quarterly business review.Supplier Relationship Management l Page 8
Engagement meetingsThe following provides a briefoverview of a typical meetingformat. Any meeting agenda willbe agreed on a one-to-one levelwith each strategic partnerseparately.Operational meeting Review of the day-to-dayoperational management of theagreement. Key areas of theprogramme will be discussed,what we do well and if requiredareas of improvementimplemented.6 monthly meeting (or quarterlyif required) Review of the contractperformance against the agreed360 degree SLAs, includinghits/misses and trend monitoring Highlight areas of goodperformance and how tomaximise what we do well Discuss and resolve key areasof concern and if requiredcreation of a performanceimprovement plan (PIP)Annual Business review Annual review of servicedelivery and performance ofboth parties against the definedSLAs Identify the long term strategicdirection of the relationship andcreate a roadmap on how toachieve our combinedobjectives Review of spend / volumes andidentify areas where futureopportunities have beenidentified Highlight areas of goodperformance and how tomaximise what we do well Manage any areas of risk andmitigating factors Review of contract compliance Identify and agree areas wherewe can ‘widen theperspective’Supplier Relationship Management l Page 9
Performance ReportingDriving performance throughhonest and open feedbackPwC recognises that transparencythrough open and honestcommunication is a key attribute forthe successful management of anagreement. As part of the framework,PwC will issue a 360 feedback surveyto all key stakeholders requestingfeedback on the performance of thecontract. The survey will detail thecurrent position of the agreement, therelationship management approachused by both parties and compliancewith the contracted SLAs .The surveys will be issued via anonline eForm and the informationgathered by the regional ProcurementDepartment. All responses will beconfidential and names removed fromthe process.4Once the information has been collatedin a report, the results will be shared withboth parties in the initial kickoff meeting;the 6 monthly meeting or the annualbusiness review meeting.Based upon the results of the survey, aroadmap detailing any recommendedchanges to the existing contract will becreated. The report will focus on whetherboth parties are adequately supportingthe process to represent fairmeasurement of performance. Forexample, PwC’s main goal for anagreement may be to manage costs atthe expense of quality, whilst the thirdparty vendor is quality and innovationfocused. In this case, the two parties’goals will not align unless a middleground is agreed upon.Once the changes have been discussedand agreed, a variation of the contractwill be issued and signed by both parties.Supplier Relationship Management l Page 10
5Annual Contract ReviewsIs the agreement fit for purpose?Every year PwC will conduct a contract review with our key strategic partners.The purpose of the review is to ensure the current contract is still ‘fit forpurpose’. The review will cover the scope of services, pricing schedule,legislation updates, new areas of innovation and technology, processimprovements and SLAs. Any agreed amendments will be completed via avariation agreement.Who do i contact for moreinformation?For more information, please contact theProcurement Operations team mer procurement operations@pwc.comSupplier Relationship Management l Page 11
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‘Supplier Relationship Management’ (SRM) programme and emphasise the fundamental message that ‘our strategic partnerships are a key component to PwC Middle East's success’. This programme will help to promote a structured framework that focuses on the following core elements of SRM: 1. Regular engagement meetings between all key stakeholders 2. 360 degree performance evaluations which .
