Emeritor was founded in 1998 from the idea that procurement has a lot to offer organisations. At that time, the profession was still in its infancy. Cees Ubink and Caroline van den Bosch built a company with hands-on, result-oriented procurement consultants. By now, Emeritor is market leader in the Netherlands and employs more than 100 people that start every single day from the belief that procurement has everything to contribute to the success of their clients. What happened since the beginning and what is still on the agenda?
Clear and concrete from the beginning
Caroline: ‘Our ambition when we started out was to improve the procurement function of organisations. Market conformity on the supplier’s side is important, but we mainly look at the quality and efficiency of the procurement processes and the position of procurement within the organisation. If those three pillars are solid, you are utilising your procurement potential to the max. The models and services we developed then still prove their value every day: The Emeritor procurement home, the Emeritor procurement maturity model, our procurement improvement programs, procurement outsourcing, INCONTO and our Executive MBA in Procurement Management.
What we came up with all those years ago could fit on a few pieces of paper. The mentality to clearly and concretely put to paper and execute them still marks us today. ’
Cees: ‘On the one hand, so much has changed in those years and, on the other, some things are still like they were in 1998. When it comes to procurement, we have made immense professional progress. The importance of the procurement function for the performance of companies has really increased.
The procurement quota of organisations has increased in all branches and industries. Organisations now focus more on core activities and procure all the rest. On average, 40 to 70 percent of companies’ turnover comes from procurement. The higher that percentage is, the higher the necessity to view procurement from a strategic point of view. Not just because of the costs that are involved, but because of the quality and efficiency of the procurement processes and the risk factor that the organisation runs in case they suddenly lose an important supplier or if the foundation of legal frameworks, such as rights of ownership or copyright, has not been established properly. However, there are still a lot of organisations where the attention for procurement is not in relation to the importance of it for the organisation itself.’
The professionalisation of our profession is ongoing. We see the influence, the authority and the role of the financial function and the CFO increase. That role becomes broader and more in-depth. We move and develop with those changes. We think that procurers will no longer exist in the near future. This may sound strange coming from a procurement specialist, but our world is going virtual. Knowing providers will soon no longer be a privilege of the procurer.
In the future, procurement as stand-alone function will be incorporated into the financial function of companies. The scope of the current procurers will become broader.
You can see this in a third development. The development from the professional procurement function to the optimisation of resources and managing of contracts that are concluded for this purpose. When it comes to resources, people look for an optimum: people want to waste as little as possible and at the same time have the necessary resources against the best price/quality. And as far as managing the contracts goes; the work used to stop after the contract had been signed, now we also pay attention to the execution of the contract itself. The added value of procurement is also making sure that what has been agreed upon is also executed.
Big steps in the field of procurement
Caroline: ‘If organisations have a procurement function, it is often an executive function and placed under general and technical services. In addition, HRM, ICT, Marketing Communication and the operational departments mostly take care of their own procurement. Insight into the total procurement volume, grip on the procurement process and the accompanying financial obligations are, however, missing. They have no idea about the savings potential and improvements on quality that coordinated procurement from verifiable criteria can achieve. In recent years, we have guided many different types of companies and governments in repositioning their procurement function. These organisations have achieved savings and made significant progress in the field of procurement.’
Cees: ‘Clients tell us that thanks to our approach, their procurement function has been lifted to a higher, strategic level. We don’t just analyse, we also help realise the improvements above all else. And in such a way that it takes root. We are open and transparent and we call it as we see it. We take the lead in the implementation and show measureable results. We recently received a great compliment from Mr Hans Wind, former ICT director of Randstad. Randstad was our first client for which we executed a complete procurement improvement program. He told us – fifteen years later – that he still looks back on that, filled with respect about what we achieved within Randstad with respect to procurement. ‘
Procurement specialists and generalists
Caroline: ‘Today, besides procurement projects and posting assignments, we now perform procurement improvement programs for ten organisations at the same time. We can do this because the services we offer are now broader and more profound. One of our strong suits is that we have procurement generalists and specialists. We have mostly grown in the number of specialisms we offer. Even in the fields that do not traditionally belong to the procurement function due to the specific knowledge that is required. Examples are construction & renovation, marketing & communication, insurances, telecom, ICT, energy and corporate social responsibility. For our clients, this means that we can supervise procurement programs in every conceivable procurement field both from procurement knowledge and content-wise as well.
Our procurement consultants and specialists are continuously moving on the procurement and suppliers markets, which means they are up to date on all developments and changes. However, we don’t use this knowledge to put the suppliers at a disadvantage by demanding the lowest price. Of course, market conformity is important – it’s the number one condition – but the trick is to challenge the suppliers to keep improving, both qualitatively and with respect to their logistics and financial processes. This is all possible in an open and good relationship. There are suppliers that are so happy with this collaboration method that they asked us to do the same for their own organisation. ’
Outsourcing procurement function
Cees: 'More and more companies are focusing on outsourcing (parts of) their procurement function. We are now doing this for Dutch company DAS and the Dutch national lottery (Staatsloterij). Why? Simple. A procurement volume of €10 to 50 million justifies the use of one procurer. At the same time, such a procurement volume includes an average of 60 different procurement packages. Nobody can expect that one procurer to possess up-to-date and immediately useable knowledge of all those different suppliers markets. From the point of view of effectiveness and efficiency, companies are choosing to structurally outsource the tactical procurement function against conditions agreed upon in advance. This gives them access to our specialists and they are guaranteed measureable procurement results, both qualitative and quantitative. ’
A great team
Caroline: ‘Our organisation has grown with the developments we have made. We have become better, larger and more mature, both in work processes and in automation and level of organisation. In 1998, Cees and I were the backbone of our company. Now, it’s us with our general manager Frans Dagelet and our managing consultants. The program managers execute the procurement improvement programs with clients and this number is steadily growing. Cees acts as a sparring partner and coach to them. By mirroring and sharing knowledge and experience, he keeps our organisation sharp as to what we stand for. Cees guides our employees towards the results with our clients and offers the necessary frameworks for that purpose. ’
Cees: ‘Caroline primarily concerns herself with the acquisition of new clients and the recruitment of new consultants. We manage our own recruitment, because we pay very close attention to the personality, skills, knowledge and experience of our people. People who work at Emeritor need to be of added value to clients and colleagues. That’s why we use three core values as litmus test in our introduction interviews. Are they reliable, passionate and enterprising professionals? Do they share their knowledge and expertise? And do they want to achieve results that exceed our expectations? ’
Caroline: ‘Diversity is essential as well in order to find the right match between our employees and clients. Our clients are very diverse, both in the branch in which they operate as in their culture and type of business. We have a wonderful team of good, motivated, loyal and hard-working people with very different backgrounds and experience. Each of them is a very valuable contribution to customer satisfaction due to their individuality and specialism. We make the difference as a team. That’s why it’s important to me that they feel at home in our company, that they feel good about themselves and that they keep developing. I regularly ask our employees how they’re doing. We are professional but transparent and close-knit at the same time. ’
Taking away worries as a mission and procurement potential as a distinguishing ability
Cees: ‘Looking at the future, there is a lot of growth potential for Emeritor, in the market and within our own organisation. Yet, we don’t steer towards an increase in turnover, but towards new developments within our service. Breadthwise, by utilising our services with more companies and procuring services and in depth by further expanding on our procurement specialisms. It’s the same with our procurement maturity model. Every step brings us – with the client’s best interest at heart – closer to professionalism, knowledge and experience and every step we take includes part of our track record with our proven result. ’