Bergen Municipality selects an analytics solution – Provides a better overview and cuts costs
In order to obtain a better overview of procurement, better price control, and an increased contract loyalty, Bergen Municipality has selected an analytics solution from SAS Institute. The municipality expects that the investment will quickly begin to save money, and that it will provide significant reductions in cost in the future.
Bergen Municipality is Norway’s second largest municipality, with 18 000 employees and 350 profit units with their own budget responsibilities. The municipality has approximately 300 000 incoming invoices annually, and about 9000 active suppliers, which makes it vital to have a good overview.
– In connection with the development of our new procurement strategy, it became clear that we required better analyses of our procurements. SAS Institute was the best choice after a complete evaluation of our tender competition. The new analytics solution will cut costs by providing us with better control of whether the pricing is in accordance with existing agreements, and by increasing the loyalty of the agreements. The investment we are making now will quickly save us money, and in the future it will likely pay itself off several times over, says Ole Rasmussen, special adviser in Bergen Municipality.
The investment we are making now will quickly save us money, and in the future it will likely pay itself off several times over.
-Ole Rasmussen, Special adviser in Bergen Municipality.
Bergen in Norway
User friendly cloud solution
The new analytics solution is cloud based, and has an automised process in which accounting data and invoices are placed onto the system once a month. Bergen Municipality has come a long way in implementing electronic invoices. About 80 percent of all incoming invoices are now placed in the digital EHF format. This provides a good basis for effective treatment and analysis of the data.
– The SAS Institute has given us a complete solution that is good at automised classification and treatment of raw data. It is very easy to integrate our accounting data into the solution, immerse yourself in them, and withdraw desired reports. We are very satisfied with the fact that the solution is structured as a cloud service. This makes it easy to get started, and the operational responsibility lies with the supplier, says Rasmussen.
Better price control and increased agreement loyalty
Bergen Municipality utilises a lot of e-commerce and, compared to many other municipalities, it has relatively good control over whether the prices adhere to the framework agreements that have been entered into. Due to a large number of suppliers, and a great many price lines, it can still be difficult to discover deviations.
– Other municipalities that have implemented an equivalent solution have quickly identified possible savings. It is an arduous task to control whether we get all agreement prices that have been entered into, and this is something that this solution does well. It makes it much easier for us to both detect deviations with regard to agreed upon prices, as well as excess billing. At the same time, we can easily discover if someone is not utilising the existing agreements. With this solution, it will be relatively easy to save several millions NOK, says Rasmussen.
We have great expectations for the solution when it comes to uncovering white collar crime. By analysing the invoices sent to suppliers with whom we have temporary contracts, we can find indications of irregularities, and thus make post-controls more targeted -Ole Rasmussen, Special Adviser
More framework agreements, fewer suppliers
With this new solution, Bergen Municipality can discover new areas in which they do not currently have framework agreements, but where having these would be appropriate. At the same time, the solution will provide valuable information in connection with the announcement of tenders, such as e.g. what and how many are procured across the 350 budgetary units in the municipality. One can gain a good overview of who is procuring what, and with it capture all the user requirements and expected procurement amounts.
– This solution is a useful tool in our objective to enter into more and better framework agreements, and reduce the large number of suppliers that we currently have. There are costs related to registering new suppliers, so a reduction in the amount of suppliers will be a cost saver in itself. We can also analyse our way towards what the benefit realisation of new framework agreements will be, and we will be able to reduce the budgets of the various units in line with this, says Rasmussen.
Corruption and white collar crime
The new solution will also be used for work, to uncover corruption and white collar crime. According to Rasmussen, the section for internal control in Bergen Municipality is interested in special reports that simplify this job. For example, the municipality procures annual temporary employment services for more than NOK 100 million, and has a duty to follow up on wage and work conditions.
– We have great expectations for the solution when it comes to uncovering white collar crime. By analysing the invoices sent to suppliers with whom we have temporary contracts, we can find indications of irregularities, and thus make post-controls more targeted, he says.
Bergen is the second largest city in Norway and the municipality has approximately 300 000 incoming invoices annually, and about 9000 active suppliers, which makes it vital to have a good overview.
The new cloud based analytics solution SAS Purchasing Analysis (Spend analysis)
SAS Purchasing Analysis helps Bergen Municipality to obtain a better overview of procurement, better price control, and an increased contract loyalty.