Bord Gáis saves time and money with real-time information from Microsoft Office SharePoint Server 2007

Situation

Bord Gáis is a leading energy supplier of gas and electricity to over 600,000 industrial, commercial and residential customers on the island of Ireland.  The company was established in 1976 and is a commercial State body, 97% owned by the Government of Ireland, with the remaining shares held by an employee share option trust. Bord Gáis employs 900 staff and is headquartered in Cork, Ireland. In 2007, the company had a turnover of €1.2 billion. Like many large organisations, the company relies heavily on contracts with suppliers, partners and customers, as Padraig Twomey, Group Procurement Manager explains. “We are a progressive organisation in terms of our outsourcing model and we have a heavy reliance on the performance of these contracts within our procurement portfolio.”  The Bord Gáis procurement department is responsible for initiating, creating, reviewing and controlling all purchasing contracts within the organisation.

Twomey estimates that the number of active contracts companywide – including procurement, sales, commercial and leases – runs to more than two thousand and that they are worth several billion euro combined. In the past, he had worked on refining the procurement process around contracts, but the process had still not been standardised. Managing contract lifecycles and performance was very labour intensive and collaboration on developing and approving new contracts was slow. Decision-making was hindered by the difficulties in locating contract-related information, which was spread throughout the organisation. Twomey adds; “We came to a point where we realised in order to take the next step, we needed to get the information online and centralised with access provided to the various business units. This centralised database had to have functionality around creation, management and governance of contracts.  There is a common view within all best practice companies that having a centralised contract management system provides great benefits. All I wanted was to bring the information together on one platform so we could get a snapshot of a contract, including expense to date and any key milestones or triggers.” Having reviewed international research to gauge best practice in this area, Twomey discovered a varied picture of the systems and suppliers in the market. He evaluated contract management systems from several vendors and found that nothing met his specific requirements. This led to the decision that Bord Gáis would build its own software. Bord Gáis partnered with PM Centrix to build a contract management system using Microsoft Office SharePoint Server 2007.

SharePoint was able to provide us with a contract database and library; a documents library; contract filter and search; action, issue and document workflow; standardised terms and conditions; standardised contract templates; dashboard contract information summaries and KPI rollups which was incredible functionality. Padraig Twomey, Group procurement manager, BGE Resolution of issues relating to performance of contracts has been greatly streamlined as well by making information accessible easily. Paul Hanover, Senior projects manager, PM Centrix

Solution

“SharePoint was able to provide us with a contract database and library; a documents library; contract filter and search; action, issue and document workflow; standardised terms and conditions; standardised contract templates; dashboard contract information summaries and KPI rollups which resulted in incredible functionality,” says Twomey. Paul Hanover, Senior Projects Manager with PM Centrix, says SharePoint is the ideal platform where there is a need to consolidate and manage both structured and unstructured information. “It is very customisable, provides strong document management functionality, collaboration, workflows, issue management, good integration facilities, KPI and rollup webparts,” he says. Much of this functionality comes as standard or is available at low cost from third parties, he adds.

BGE already has Oracle Financials and PM Centrix has extensive experience in linking to this data from SharePoint. It developed a service which updates spending on contracts at hourly intervals. This gives contract stakeholders a complete and up-to-date picture on overall contract financial performance. Linked with Sharepoint alerts, this allows contract costs to be managed proactively, with the additional benefit of letting contract managers look into the detail of the contract documentation to check information about the area under review.

The implementation took place over five months. An initial proof-of-concept pilot phase took one month but this did not include real-time information. The project went live in May 2008 and is deployed on the MOSS server at Bord Gáis headquarters. The initial pilot group includes the procurement area with BGE and the Networks Business Unit, involving close to 80 users. Over the next few months the solution will be rolled out to the rest of Bord Gáis. Currently 100 procurement contracts are on the system. Within the procurement section alone there are more than 600 active contracts and the goal is to have them all available through Microsoft Office SharePoint Server by the end of this year, with commercial contracts to follow. “We’re migrating people over gradually, so it’s not a big bang approach,” says Twomey. “A lot of contract management system projects come unstuck because they went for everything on day one. We’re getting more people involved in phase two, which is about further adoption.”

He admits there was some scepticism in the business at the prospect of developing a bespoke software platform, but the doubters were soon won over. “No matter what was thrown at SharePoint, the Bord Gáis IT department the procurement department together with PM Centrix were able to come up with a solution. The more success we achieved, the more it generated its own energy in the project … we seemed to be breaking new ground all the time,” he says. He is full of praise for the external partner on the project. “I must say PM Centrix were excellent. They showed a fierce commitment and enthusiasm to achieve a solution.”

Benefits

Fast access to relevant data
According to Hanover, the amount of time it takes to gather and manage all relevant information relating to a contract has been reduced from days to minutes. “Resolution of issues relating to performance of contracts has been greatly streamlined as well by making information accessible easily,” he says. 

Supports business processes
The SharePoint-based system has helped Bord Gáis to standardise its contract management process. The collaboration features in Microsoft Office SharePoint Server 2007 have enabled the company to simplify and streamline the process of developing and approving contracts. Meeting with Bord Gáis’ strategic goals, Microsoft Office SharePoint Server2007 provides a single resource for all contract-related information, giving staff greater visibility and control of the overall contract lifecycle to enable proactive management of risk and facilitate better informed decision making.

Key performance indicators for executives
SharePoint provides KPI rollups to Bord Gáis which means that senior staff, from the head of finance to executives in any business unit, can see all the contracts in one list at the push of a button. The list includes names of the contract managers, suppliers and the cost to date. Each contract listing has a traffic light marker to indicate the status. “If it’s green, the unit manager can ignore it. If it’s amber, he can ask questions about it or if it’s red he has a direct issue with that contract,” says Twomey. “Before that traffic light system he couldn’t do anything; it was only ad hoc. Now he can tell immediately. He knows just by pressing a button that there might be ten contracts out there that he needs to ask about at his next management meeting.”

Money saved
Bord Gáis is aggressive in pursuing volume discounts and the contract management system gives executives oversight of where savings can be made. Microsoft Office SharePoint Server 2007 has an alerts feature which sends reminders about contracts to key stakeholders, ensuring they can avail of discounts. “For instance, in a particular year based on volume you could get maybe a quarter of a million euro back,” Twomey explains. “You can date stamp it or time it, so that every 12 months on a particular day, a mail shoots out from SharePoint and it goes to the contract manager, to the procurement manager involved and it might go to the executive to say: ‘you’re entitled to a discount’.”

Centralised information at a glance
The wealth of contract information available through Microsoft Office SharePoint Server  impressed auditors on a recent visit, Twomey recalls. “Suddenly, within one minute we were able to show them a couple of hundred contracts in lists to go through with drill down information: costs associated, who’s managing it, how old it was, when is the renewal date and so on,” he says. “It feels like we are on top of our game.”

Summary

Twomey is more than satisfied with how MOSS 2007 has delivered a working contract management system – faster and more cost-effectively than other projects elsewhere. “It exceeds our requirements. The team are really enthusiastic about SharePoint in actual fact. It’s now become a flagship within the company of what SharePoint can do,” he says. “SharePoint had all the different functionalities and toolsets to build your own software. We got a contract management system live within five months and we didn’t buy it off the shelf. I looked around and it usually takes 12-18 months to do it. And, it was done so cost-effectively as well. We were quoted anything from €350,000 up to €1 million and then there are implementation costs on top of that. We did this for €100,000 and we did it in five months,” he states proudly.

For more information about other Microsoft customer successes, please visit:

www.microsoft.com/casestudies

For More Information

For more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234 in the United States or (905) 568-9641 in Canada. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to: http://www.microsoft.com/

© 2007 Microsoft Corporation. All rights reserved. This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.
Document published May 2008