The Challenge:

Following the merger between Boots and Alliance Unichem, the newly formed management team, made up of executives from both businesses, were faced with the challenge of identifying immediate and short term synergy opportunities across the supply chain in order to deliver the financial benefits outlined in the original business case. A challenge further exasperated by the proud heritage, confidence in their performance and independence of supply chain management teams in both businesses.


The Approach:

Engaged initially to work with the ‘synergy team’ at Boots to identify opportunities across good and service not for resale, a team from Procure4 quickly set about conducting the ‘hard scoping’, compromising the capturing and cleansing of pricing and contract data at individual price and service level from the multiple business units of the newly formed entity. This in itself created huge challenges as Procure4 needed to engage busy and nervous stakeholders, utilising multiple systems and a range of taxonomies and product descriptions, to create a single spend cube that identified the theoretical synergies available. However this major and largely desktop exercise represents only half of the story and in itself did not produce a set of targets that Procure4 could confidently set as being deliverable and sustainable across a traditionally independent group of multi-site, multi-culture and multi-geography business units.  

The second and in Procure4’s view, more important element to the project was the ‘soft scoping’, where the Procure4 team interviewed budget-holders and end-users of the goods and services to establish the receptiveness and operational ability to consolidate suppliers and specifications across the diverse scope of categories. Equally Procure4 was testing the changes that might be required to processes, systems, roles and disciplines across the business units in order to lock in and track the benefits to the bottom line of Alliance Boots.


The Result:

Procure4 produced a data cube with consistent taxonomy and product descriptions across 50 Categories, that outlined the existing contract status and net pricing at line level for the goods and services across the newly merged Group. This then allowed the team of category leaders to identify synergy opportunities and the headline Approach Strategies to unlock the benefits across 3 simple tiers:

  • Immediate: Where business units were using the same items from the same suppliers, but at a range of pricing.
  • Quick Wins: Where there was an opportunity for business units to consolidate on a single specification in a situation where they shared suppliers but utilised a range of specifications and therein prices.
  • Longer Term: Where there was an opportunity to consolidate both specifications and suppliers, but utilising a proven solution that was already effective in one or more business units.

The group procurement director was then able to take this independently produced information to help facilitate the transition to a more centralised approach to procurement, setting robust targets with proposed delivery methods for the huge team of buyers from across the two original businesses.

Key Facts

2,500+ Number of UK Locations
50 Number of Categories Addressed
70,000 Number of UK Employees

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