Industry:
Government

Annual Revenue:
$500M-$1B

Employees:
>=10000

"The Oracle E-Business Suite gives us an integrated solution with which we can deliver continuous business process improvement and economies of scale in all our procurement practices as we drive forward the efficiency agenda across the organisation." -- David Rabey, Director of Purchasing and Supply, Defra

Established in 2001, the Department for Environment, Food and Rural Affairs (Defra) is a U.K. government department tasked with promoting sustainable development and a better quality of life for the country's citizens. Defra serves as a focal point for the U.K.'s rural, economic and environmental policy making. And today, thanks to intelligent investment in information technology, it's also becoming a model of organizational efficiency and productivity in its corporate services.

Already, Defra has generated considerable savings by consolidating and automating its procurement processes with new enterprise-resource planning (ERP) technology from Oracle. Today, the organization uses workflow-driven electronic processes to achieve "touchless" procurement for many goods and services, and it is rationalising supplier contracts to facilitate best in class supply chain management for the mutual benefit of client and contractor.

Using Oracle's integrated financial management applications, the department has been migrating from cash-based to accrual-based accounting--in line with government requirements. Defra is also on target to meet HM Treasury mandates that require public sector organisations to close their year-end financial books more quickly.

Defra plans to improve productivity further by introducing self-service applications over the internet, which will help Defra meet Government objectives, as set out in the Gershon Report, that call for simplified and effective procedures and improved efficiencies across the public sector. A key to all the improvements is the Oracle system's single data repository, which links data generated from corporate business processes and enhances data commonality across the organization. What's more, the integrated system provides senior managers with immediate access to the latest business data and reports right from their desktop.

Smarter Purchasing Saves £600,000 Each Year

By using a department-wide purchasing solution, Defra is better able to capture spending details and patterns and cut costs by consolidating purchases with its suppliers offering the best prices and terms. "Smarter use of e-procurement solutions has already generated savings of £600,000 each year, based on the Office of Government Commerce (OGC) measurement criteria," said David Rabey, "These savings will grow as we make increased use of Oracle's built-in analytical tools to analyse our spend more closely and prevent contract leakage."

David Rabey added, "The strategic objective is to improve the effectiveness and efficiency of the procure–to-pay (P2P) business transaction processes and incorporate the principles of:

• Self-service philosophy with end user empowerment


• Use and acceptance of electronic auditable signatures


• Capture of all expenditure commitments at time of commitment


• Avoidance of re-keying data into multiple systems


• Fast electronic communications, internal and external


• Standardised processes with a single source of financial information.

Self-Service Improves Purchasing Speed and Transparency

For more routine purchases, Defra has created online catalogues where currently over 1,000 employees select goods and services at pre-negotiated prices. Built with Oracle iProcurement, the "buy4defra" solution is configured for each business area to comply with its own budget constraints by setting spend levels for each employee.

For more complex expenditure where goods and services cannot be found in the online catalogues, the requestor can raise requisitions with all known relevant details and buyers in the Purchasing Units will confirm sourcing and price before placing the Purchase Order.

Employees can track their purchases on the system, which automatically alerts senior managers when they need to approve purchases over a certain amount. According to Defra, Oracle iProcurement is a key part of its strategy for streamlining purchasing processes and lower operating costs. In the coming year, the Department plans to roll the system out to a further 2000 staff and include many new types of expenditure under the buy4defra programme.

Building Cost-Effective Relationships with Suppliers

The online purchasing system also enables Defra's suppliers to cut the cost of doing business with the department. With Oracle Contracts, an Oracle E-Business Suite application, Defra is automating and standardising the way it manages contracts with suppliers and other business partners. The system will replace Defra's spreadsheet-based contract-management processes in Defra's business divisio customising Oracle applications to match your existing business processes. Oracle applications already have a lot of the functionality Defra needs, so it makes better sense to re-model your own processes on them.

Defra was created in June 2001 to manage U.K. government initiatives in the pursuit of sustainable development and a better quality of life for all.