Background

Dunedin City Council (DCC) (DCC) is the local authority for the Dunedin city area and represents the 114,347 citizens that live in Dunedin, the second-largest city in the South Island of New Zealand and the principal city of the Otago region. The Council is responsible for the governance of, setting the city's strategic direction and ensuring it works towards meeting the community outcomes within the budget it has available.

What they needed

Numerous auditors’ reports around contract management had identified that DCC’s processes and in particular, the lack of a central repository to manage thousands of contracts was a real problem. The Council had limited visibility of contractual information, such as key clauses, expiry dates and so on.

In addition, there was limited contract spend visibility, limited reporting capabilities and limited forecasting information, which meant that there was limited data available for strategic decision making at contract renewal time. There was little understanding if they were getting value from their contracts.

Contracts data was saved by some of the Council’s departments into Excel spreadsheets that were used to track some of DCC’s contracts, but a lot of data was found to be missing. In some cases, though, contracts were stored on individuals’ computers and for a few, the hard copy contracts were stuck on the wall by someone’s desk or kept in a drawer.

DCC realised it needed to automate supplier contracting activities, streamline approvals, manage flows and capture rich data about contracts, so it set about looking for an intelligent contracts management solution.

“There were several challenges that we had in terms of contract management at DCC, but the main issue was that we had limited visibility across Council of the contracts we had in place, so we knew we had to do something different,” said Serge Kolman, Procurement & Contracts Manager at Dunedin City Council.

Finding a solution

Starting the selection process for a Contract Lifecycle Management (CLM) solution was the driver for lifting capability around contract management and how DCC manages its contracts.

Based on past experience, DCC was determined to better identify the type of software partner they wanted to work with, and its procurement team decided to adopt the Lean Agile Procurement (LAP) approach for the selection of its CLM solution. This highly collaborative procurement method reduced the usual selection process from three months to three days and ensured that the chosen solution and vendor was going to be the best fit for the Council.

15 responses were submitted by various technology providers, and this was shortlisted down to three for the final stage of the vendor selection process.

The partnership approach Portt had taken throughout the LAP process gave DCC early confidence that their working style would be complementary to the way its own team operated and this would contribute to a positive long-term working relationship.

“The Lean Agile Procurement approach allowed for open communication and problem-solving, resulting in a collaborative and trusted environment where both parties could build a strong relationship,” said Serge Kolman.

The implementation

Portt’s CLM solution was selected by DCC’s senior decision makers because it was designed to provide staff with efficiency gains, quality data and compliant contracts, transforming supplier contracts into strategic business assets.

Portt’s CLM solution was selected for several key reasons, but primarily because Portt was the only technology provider that positioned this as a strategic business improvement project for the Council. The strong relationship both parties had established during the procurement process set a solid foundation with both organisations working together in a collaborative, cooperative and flexible manner throughout the CLM implementation.

Realising the benefits

DCC can now plan properly for contracts that are coming up for renewal and understands the performance against contracts, which is a key strategic advantage during contract negotiations.

DCC believes it is now able to create efficiencies to achieve cost savings to improve on wider benefits to the community, which will result in a significant improvement to its public dollar optimisation aims.

The user feedback is very good, with staff being positive about the functionality of the system, which they are finding to be an easy to use and intuitive tool.

“We have really valued the people involved in our business from Portt and the trust and relationships we have built. We truly believe that the support throughout the implementation and ongoing support we are still receiving to be excellent,” said Serge Kolman.

Serge Kolman said: “I’ve awarded many, many contracts, but I’ve never been hugged by a supplier at the end of it, when I told them they had won the contract. That tells you something.”

Next steps

What DCC wants to achieve once all of the contracts data is live is to be able to actively manage the entire contracts process through the system and have visibility of every contract the council has, know its value, expiry and deliverables.

“If I can push a button and see exactly what we are spending on all our contracts, that’s the aim. I will be able to talk to department heads and understand their spend and which contracts are coming up for renewal,” concluded Serge Kolman.

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