Leading global excellence in procurement and supply

CIPS President – Mission 2013 CIPS Branch MeetingSouthampton 14th March 2013

Leading global excellence in procurement and supply

1980’sGetting Qualified•Physics Degree•ICI – Chartered Engineer

•Open Windows in Engineering

•Young Engineer for Britain

• Met Steve at Manchester University ‘82 - married ‘87

1990’sGetting Going • ICI / Zeneca• Production Manager• BPR Leader• Supply Chain Manager

• Fellow RSA• Starbucks Cool Coaching Project Leader

• Chair PTA / Chair School Governors

• Natalie 90, Naomi 94

2000’sKeeping Going• AstraZeneca•Director Outsourcing •Head UK Purchasing•Global Procurement Transformation Programme Leader

• Head R&D Procurement

•CIPS Member / Fellow•Natalie to University ‘09

2010’s What next?•Novartis•Head Development Strategic Sourcing

•Chair / President CIPS•CIPS Modernisation Project Sponsor

•Numi to University ‘12

Who is Paula Gildert?

Leading global excellence in procurement and supply

• Raise Awareness & Profile of Procurement & Supply Chain as a Profession

• Build responsibility for Leadership & Legacy in our Community of Practice

What do I want to achieve as President?

Leading global excellence in procurement and supply

• Promote & Develop our Value proposition – a new winning strategy that goes beyond savings

What do I want to achieve as President?

Leading global excellence in procurement and supply

20102011

20122013

96

144

120 127

Novartis Pharma - Development Gen Meds Cost Reduction Performance

Savings $m

An Example

7% 10% 9%Target 9%

Leading global excellence in procurement and supply

Continuous Improvement

Cost

Innovation & Insight

Quality & Service

Assurance of supply & risk

mitigation

Corporate responsibility

What does Value Beyond Savings look like?

DSS – 2012 Executive Summary Dashboard

Productivity

eROI

Measure YTD / Target / LO Status

Cost savingsOther Development

Cost savingsOther Novartis Div

Cost Avoidance

TPC reduction

Measure YTD Target Status

Savings

Spend*

Savings %*

LO 2012

7 | Development Strategic Sourcing| Pharma Dev| Dec 2012 | Sourcing Productivity | Business Use Only

2012 Sourcing Productivity Savings Development GenMed Dec 2012 YTD: USD 120m

*based on succeed actuals

Ahead of run rate/target 70-90% of run rate/target <70% of run rate/target90 -100% rate/target

eAuction Spend (w/Projections), $M

DSS - BSC 2012 Executive Summary

People

Customer Suppliers

Internal Processes

Ahead of run rate/target 70-90% of run rate/target <70% of run rate/target

Measure Actual Target Status

Satisfaction*

Measure Actual Target Status

Satisfaction* Baseline

Measure Actual Target Status

Focus on Core Activities*

Measure YTD Target Status

Satisfaction* Baseline

Quality – actions complete Baseline

Study Performance Baseline

* May 2012 DSS pulse check survey results

* July 2012 DSS customer survey.

90 -100% rate/target

8 | Development Strategic Sourcing| Pharma Dev| Dec 2012 | Sourcing Productivity | Business Use Only

*portfolio / portfolio enabling: Oct 2012 data

Development Productivity 2009-2012$1bn in Productivity gains & $900m in Reinvestments

Development $1b Productivity 2009-2012Key Drivers of Success: Embedding productivity in objectives & intro of KPIs Clinical savings through Design Excellence & use of

preferred providers & partners TRD transformation of clinical supply chain and

capacity utilization and process optimization initiatives Better Development and Productivity Mindset

Reinvestment of Savings $900m (90%): Reinvestments to address increased volume

needs: Reinvestments into projects above what was

expected in budget Reinvestments into new innovations Other reinvestments Financial risk management

Productivity delivery

In USD$Mio @ Budget 2012 rates

Total Reinvestment

$900m

Actual 2009

Actual 2010

Actual 2011

Actual 2012

9 | 2012 Update | Neil Johnston | Jan 2013 | Confidential

Development Productivity 2012Enabling reinvestment in the pipeline, building capabilities and improving Pharma bottom line

Reinvestments to address increased volume needs in

IDFR $50m

Example 1

Example 2

Reinvestments into projects/risk management

$174m

Dev Proj 1

Dev Project 2 etc..

Reinvestments into new innovations in Tech Research &

Development $70m

Project 1

Project 2

Project 3

$294m in Reinvestments

10 | 2012 Update | Neil Johnston | Jan 2013 | Confidential

Leading global excellence in procurement and supply

12

Thought

Leading global excellence in procurement and supply

• Building the Brand on a Global stage

• Building Global Standard

• Building a Global Network

How does CIPS make this a real possibility?

Leading global excellence in procurement and supply

Strategic Themes FY14 +

Public Good

Leading the Global Standard

Membership Transformation

Knowledge Leadership Global Reach

Sustainable growth in Corporate Customers

Leading global excellence in procurement and supply

• Global Community of over 88,000 in 150 countries• Offices in South Africa, Australia, the Middle East, the UK, and

setting up in China • Over 130,000 education assessments conducted in 2011 • 8.7 million page views of the CIPS website each year• Our PR coverage exceeds £20 million Advertising Value

Equivalent each year• Over 6,000 members a year attend our events including our

annual conferences attracting thousands of guests • Purchasing Managers’ Indices, key economic indicators used by

the Bank of England and organisations all over the world

CIPS – the vital statistics

Leading global excellence in procurement and supply

CIPS Foundation

Leading global excellence in procurement and supply

CIPS Qualifications Programme

Leading global excellence in procurement and supply

The strategic importance of the Branches

Leading global excellence in procurement and supply

Thank you