Strategic Management Report V6

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Strategic Management
Assessment - Feedback Form
Student ID: B00245853
Skills and Qualities Comments/Feedback
Question 1: 100 marks
Key Areas
 Choice of company
 Discussion of timeline
 Discussion on leadership
 PESTEL model applied
 Stakeholders possibly discussed
 Organizational culture possibly discussed
 Discussion of changes that have influenced the organisation and the
organizations response
 Appendices linked into overall discussion
 Ansoffmodel
 Strategy directions/methods
 Some reflection on approaches
 Review of strategy implementation
 Possible review of strategy by external analysts
 Strategy achieved desired outcomes
 Strategy resolved external or internal issues/challenges.
Question 4 : 100 marks
 Identification of existing performance and performance measures
(internal and external).
 Possible use of balanced scorecard
 Explain/discuss the organizations own performance model – if one
exists
 Suggest additional performance measures
 May considerstakeholders and performance measures.
 Discussion of strategies open to the organisation
 Ansoffmatrix possibly used as a framework Ansoffmatrix,
referencing to financial strategies,linking to limited growth and
substantive group strategies
 Justify strategies based on SWOT, competences, STEEP, resources.
 Possibly justify strategies based on internal resources or and
environment.
 Some groups might use models like Thompson: appropriateness,
feasibility and desirability
 Possible discussion and focus of EVR congruence.
 Marketing and brand management.

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USE of Models – not all are expected but how they are applied is
important
 Usage of STEEP model.
 Company’s response to impact of STEEP factors.
 Usage of Porters Five Forces
 Discussion of nature of competition, market share and approaches to
competing. Response to competitors.
 Identification of stakeholders – main focus on owner, family,
customers, staff and suppliers.
 Model stakeholder matrix based on interest and power
 Discussion of areas linked to SWOT and factors that underpin
competencies or changing competences.
 Discussions on systems, organizations restructuring, relationship
management, financial management and brand management.
 E-V-R applied
 Balanced scorecard
General (taken into consideration for all questions)
 Coursework carefully structured
 References correctly cited using appropriate conventions (e.g.
Harvard)
 Coursework is carefully presented: is legible, grammatical and has
correct spelling
 Evidence of proof-reading
 Flow of discussion and reads well
 Customizes diagrams, has logic, clear demonstration of
understanding
 Evidence of wider reading
 Overall evidence of effort and understanding
Action Point(s)
Recorded Marks:
Grade: Mark:
2nd Mark
Date:

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University of West of Scotland
Strategic Management Report
Trimester 1
2014/15
Word Count (Excluding Tables, Graphs, Quotations, Recommendations or Appendices): 5538
BA Business – Paisley Campus
Author: B00245853
December 2014

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TABLE OF CONTENTS
Page No:
Executive Summary 5
Introduction 6
Scotland Excel Timeline 7
External Changes and Organizational Response 8
abc - Authorities Buying Consortium – Origins 8
Staff Information 9
The New Organisation 9
Corporate Image & Identity – Branding and Marketing 9
Business Ethics 9
Corporate Social Responsibility 9
Leadership Model & Company Structure 10
Scotland Excel Funding & Governance 10
Core Competencies and Capabilities 10
McKinsey’s 7S Framework 10
Company Analysis 11
SMART Objectives 11
SWOT Analysis 12-14
Porters Five Forces (Adapted Model) 15
Associated Procurement bodies in Scotland - ? Mergers & Acquisitions 15
PESTEL 16-17
Scotland Excel’s response to impact of PESTEL factors 18
Proposed Strategic Management Model for Public Sector 18-19
Strategy Direction – Methodology – Underpinning Issues 20
The Decision Makers 20
Internal & External Stakeholders 20-21
Organizational Culture 21
Performance Measures 22
Contract Milestones 22
K.P.I’s – Key Performance Indicators 22
Ansoff Matrix 23
Influence of Management Data on Financial Strategy 23
Thompson’s Desirability, Feasibility and Viability Model 24
Change & Conflict 24
EVR Congruence 24
Balanced Scorecard 25
Conclusion 26
Reflection and Potential Strategic Organizational Recommendations 27-28
References & Bibliography 29-30
Appendices
Appendix A Map of Local Authorities 31
Appendix B Freemind Map – Scotland Excel Governance & Funding 32
Appendix C Commodity Categories 33
Appendix D Contract List – as at 2014 34
Appendix E McKinsey's 7S Framework – Scotland Excel 35
Appendix F Change & Conflict 36
Appendix G Cultural Web – The Paradigm 37
Appendix H EVR Congruence 38

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Executive Summary
Scotland Excel is a non profit organisation in the public sector that was created in 2008 in response to
the “Review of Public Sector Procurement Report” by John F. McClelland CBE in June 2006.
Prior to this date, the procurement process for all goods and services required in Scotland was undertaken
not only at national level, but local authority level and in some cases (depending on the size of
the product/service required), a d h o c company/institution level. The 2006 report highlighted the
need for a more efficient approach to procurement and documents the strategies that should be adopted to
ultimately lead to more focused and cost efficient process in an effort to maximize all resources.
Mass procurement existed prior to this date, however not on the scale proposed by the 2006 report and it
was clear that many significant changes would be required to take place both at the national and local
level. The changes adopted were not necessarily well received by all stakeholders and these issues shall be
briefly addressed in the report.
The overall strategy of the 2006 reform report was clear and it set out to change the following aspects of
procurement by analyzing:
 The current structure of procurement organisations
 The current skills and capabilities within those organisations
 The current practices and procedures utilised within those organisations
 Performance indicators and targets (K.P.I’s – Key Performance Indicators)
 Opportunities for improvements and new techniques that could be implemented
This strategic management report shall discuss the role of Scotland Excel, its origins and the strategies that
have been set, evolved and implemented over the years pre and post its creation. By analyzing the
strategic leadership, structure, culture, market forces, environment and strategic direction this piece shall
address the following questions.
1. What significant external changes have influenced the organisation over the last 10 years and how
has the organisation responded to the external changes?
2. What strategy approaches (methods / directions) has the organisation been following?
3. How successful has the organisation been in its strategy development and implementation?
4. What performance measures would the author adopt to measure the organisation’s performance?
5. What strategies should the organisation adopt in the future?
This report will discuss the strategic tools used in the analysis (stakeholder significant grid,
PESTEL, SWOT, Cultural Web, Stakeholder Analysis, Ansoff Matrix) and shall also draw upon
evidence from a variety of sources such as the internet, journals, text books and company documents such
as organisation reports (available in Appendices).
Potential organizational strategic recommendations shall be noted after the conclusion.

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Introduction
For the purposes of this Strategic Management report, the company that shall be analyzed is
Scotland Excel.
Scotland Excel is the Centre of Procurement Expertise for the local government sector in Scotland.
Established as “Scotland Excel” in 2008, its remit is to work collaboratively with members and suppliers to
raise procurement standards, secure best value for customers and to improve the efficiency and effectiveness of
public sector procurement in Scotland.
Scotland Excel develops and manages collaborative contracts for products and services where a strategic
requirement is identified across the sector. Scotland Excel facilitates the development and sharing of best
procurement practice and takes an active role in ensuring that the needs of the Category B sector (categories
explained in Appendix C) are understood within the wider landscape of procurement reform.
Scotland Excel is a non-profit making organisation funded by participating local authority members. The
organisation head office is located in Paisley, with regional teams based in Aberdeen, Edinburgh and Inverness
which provide front line customer support to its members throughout Scotland.
The official website for the company is: http://www.scotland-excel.org.uk/
The strategic direction of the company can be found in the Visions and Values section of the Scotland Excel
website (2014):
Purpose Scotland Excel's purpose is to work collaboratively with members and suppliers to raise
procurement standards, secure best value for customers and to improve the efficiency and
effectiveness of public sector procurement in Scotland.
Vision Scotland Excel aims to be recognised, respected and trusted by local authorities and
suppliers as the leading procurement organisation in Scotland.
Values The following principles, which are shared across Scotland Excel, underpin our approach
and are integral to success.
Excellence We practice excellence in everything that we do - in our procurement activities and our
service to customers.
Innovation We are innovative across all areas - in the strategies we develop and how we share best
practice.
Commitment We are committed to our employees and our customers - in working collaboratively and
sustainably to deliver best value.
These “Shared Values” will be further explored in Appendix E – McKinsey’s 7S Framework.
This report shall analyze the strategic leadership, structure, culture, market forces, environment and strategic
direction by focusing on the questions posed in the Executive Summary.

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Scotland Excel Timeline
SCOTLAND EXCEL – TIMELINE1975 -2014
1975 -
1996
• Strathclyde
District
Council
“ Purchasing
“
Department
• Created
under the
Labour
government
into the
reign of the
Conservativ
e party
1996
• 11 unitaries
created
• abc
created
with all 11
unitariesas
members
1996 –
October
2006
• Ronnie
McLean –
Managing
Director
• Non-council
members
join
June
2006
• John F.
McClelland
procuremen
t report
published
October
2006
• Dorothy
Cowie takes
over as
Managing
Director
after Ronnie
McLean
retires
3rd May
2007
• SNP
government
– significant
changesto
Scottish
procuremen
t enacted
after this
date
March
2008
• abc ceases
to exist
• Scotland
Excel is
established
• Moved to
new
premises
April 2008
– May
2009
• Internal
restructure
of
administratio
n staff
June 09 –
Sept 10
• Major
decrease in
local
authority
spend
• All 32 local
authorities
agree to join
Excel
• Contract
values
exceed £235
million
Sept10
• Major
corporate
restructuring
process
• Staff
numbers
reduced
from 80+ to
54 through
voluntary
retirement
and
voluntary
redundant
packages
February
2013
• Horsemeat
scandal –
documente
d in national
press
• Foster care
contract
concerns
raised at
national
level
2013
• Forced to
move to
new (lower
cost)
premises
August
2014
• Dorothy
Cowie
resigns

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External Changes and Organizational Response
Scotland Excel is a Centre of Procurement Expertise for Scotland's local government sector, however its origins
stem back nearly thirty years to what used to be simply known as the "Purchasing" Department of the now
decommissioned Strathclyde District Council (1975 – 1996). Strathclyde Council was broken down into
multiple smaller local authority unitaries.
A map of the current local authority breakdown can be found in Appendix A.
From Appendix A it is clear that the area covered by Scotland Excel is diverse. The terrain, language diversity,
technological boundaries, weather, political and social norms within a country with a population topping just
over six million citizens with a land mass of 30,314 square miles places many obstacles in the path of any
company let alone one that is trying to reduce costs, maintain quality yet work within rigid ethical, legal and
political guidelines. These issues will be discussed later in the report.
abc - Authorities Buying Consortium - Origins
Over the past thirty years there have been significant changes in the Scottish political landscape and these changes
have directly affected (possibly more than any other factor) the organisation and its strategic development.
Originally an administrative process, the Purchasing Department of Strathclyde District Council took
responsibility for the tendering process and purchase of goods for educational and social requirements within that
one region however subsequent to a restructuring of the local unitaries, many key personnel from Strathclyde
District Council Purchasing Department transferred over to a newly formed company called "abc" or the
Authorities Buying Consortium (original logo below).
Strathclyde District Council, prior to its altered state, dealt with the procurement of goods and services for a
large land and population mass. Once dissolved, this previously large district was broken down into multiple
smaller unitaries, however contracts were already in place and as these were legally binding it was agreed that
a new procurement body would be set up to manage these. Experienced Purchasing staff were already in
place however, technically, the employer of these staff members no longer existed. In 1996 it was agreed
that Renfrewshire Council would continue the role of employer and all Strathclyde District Purchasing
employees would now continue their service under the umbrella of Renfrewshire Council.
From 1996, abc created and maintained all Category B (explanation of categories provided on Appendix C)
contracts for these eleven smaller local authorities.

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Staff Information
Fifteen members of Strathclyde Council transferred over to abc for its launch in 1996 and over the following
ten years new staff members were hired and by 2006 the staff population had increased to forty six
permanent members of staff.
From 1996 through to 2006, abc took on the procurement role for various other small local authorities
including Perth, Dundee and Tayside, various non-profitable organisations as well as several branches of the
Scottish Fire Department. As the business grew and the contracts swelled, it became apparent that the
company itself would have to expand to cope with new demands.
In June 2006 John F. McClelland CBE (Scottish Businessman) wrote a Consultation Paper outlining the need
for compulsory purchase in Scotland in a bid to make mass savings on all local authorities’ budgets and abc
would be required to expand and diversify to meet the criteria set within the paper. Ronnie McLean retired in
2006 shortly after the paper was published and the Manager Director at the helm became Dorothy Cowie.
The New Organisation
In April 2008 abc ceased to exist and Scotland Excel was launched. Subsequent to the change it was apparent
that there were not enough staff members to cater for the increased contracts and local authority members.
From April 2008 to April 2012 staff numbers increased to over eighty permanent staff members with several
full time temporary contracted staff to work on short term projects.
Corporate Image & Identity – Branding and Marketing
Scotland Excel as a non profit public body is not “branded” directly towards the public as it offers a service
and not a product easily recognizable and does not have any direct competition. However, the organisation
prides itself on its professionalism and has won several awards in various categories of the prestigious “Go
Awards” (Excellence in Public Procurement) which are held annually. The company worked with its
own internal Marketing Department to create a logo and brand that would raise awareness in the Scottish public
domain; however this was within the confines of the Scottish Governments’ remit and guidelines.
Business Ethics
Working within strict legal, moral and ethical guidelines, the organisation is under constant scrutiny by all
stakeholders to perform. Any aspect of the business can be legitimately queried under the Freedom of
Information Act 2000 and therefore it is every employee’s responsibility to ensure that every aspect of the
business is conducted in an ethical, fair and transparent way.
Corporate Social Responsibility
As a government body, Scotland Excel adopts a proactive approach to corporate social responsibility and
sustainable practices by taking a holistic view of the social, economic and environmental implications of
procurement choices.
Scotland Excel prides itself on its environmental reforms that include only using recycled products, recycling all
possible waste, energy efficiency measures throughout the office and include sustainability clauses in all
contracts.

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Leadership Model & Company Structure
The organisation is highly bureaucratic but with a relatively shallow hierarchical structure. Ultimate
responsibility for the day to day running of the organisation falls to the Managing Director. The
organizational structure (prior to August 2014) was: http://www.scotland-
excel.org.uk/web/FILES/Organisational_Structure.pdf.
The structure of the organisation is functional and conforms to Chandlers Contribution (Witcher and Chau
2010) whereby specialist divisions within the business are divided into separate teams for example, Marketing,
Business Services (including Finance) and IT are separate from the main Procurement Department and have
different Heads of Division. The main issue with this functional structure is that each of the departments
become own-goal oriented and merely focus on their duties rather than necessarily working in unison towards
to organizational visions and values. The bureaucracy within the business is high and therefore administration
waiting times for formal decisions and can extensive and preventable.
Scotland Excel Funding & Governance
Scotland Excel was given a £4 million grant by the Scottish Government in 2008. This would be used for
“start up costs” and would the back bone of income for paying for all aspects of the business (including staff
wages) until the company became self sufficient. Ongoing funding is achieved through Member subsidies (i.e.
every local authority and associate member pays a fee to be part of Excel. They make this payment in return
for savings made against the contracts and frameworks in which they participate. Should any member leave
Excel membership this could have detrimental effects on all stakeholders (to be discussed later in SWOT
analysis). Appendix B is a Free Mind map of the governance structure of Scotland Excel. The map also
provides a basic background on the funding of the organisation.
Core Competencies and Capabilities
Witcher & Chau (2010) state that core competencies are “the organizational specific abilities that work
together and the knowledge and learning that manage strategic resources in ways that create competitive
advantage.”
Scotland Excel is in a unique and unrivaled position. The business was created with a specific purpose and is
not emulated by any other organisation in the country. Albeit the structure is formal (even though there are
satellite offices, these too have a formal functional structure that feeds directly back to the Directorate within
the Paisley HQ), the staff have a set culture and working ethic that only other large procurement bodies could
understand or relate to. The Procurement Managers have a direct influence over suppliers and their products
unlike any other procurement body in the country (as Excel only deals with Category B commodities). The
company attempts to work in a holistic way to ensure that the values and visions of the company are realized
and implemented.
McKinsey’s 7’s Framework
The framework made popular by Tom Peters and Robert Waterman (1980) and illustrates the need for an
organisation to look at itself as one holistic entity with seven important variables that are interlinked with one
core “Shared Value”. The writers state that it is “difficult, perhaps impossible to make significant progress in
one area without making progress in the others as well”. The seven variables for Scotland Excel are discussed
in Appendix E.
The report shall now analyze the models/theories that the company may have used to plan its strategy.
For the purposes of this report the SMART, SWOT, Porters Five Forces and PESTEL models have been
considered.

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Company Analysis – Scotland Excel Potential SMART Objectives
Goal Achievable / Achieved
S.pecific – what is the desired goal?
Work collaboratively with members and suppliers to
raise procurement standards
Secure best value for customers
Improve the efficiency and effectiveness of public
sector procurement in Scotland
Make best savings
Work efficiently with all available resources
Working to date. Continued focus on inter-stakeholder
communications. Maintain strong links and work on
strengthening others. Focus on delivery of best
savings.
M.easurable – how can progress /
completion be quantified?
Key contract milestones
KPI’s
Management Information Data analysis
Supplier Meetings
User Intelligence Group Feedback
Audit – internal/external reports
All data measurable. Achievable to date. Any new
contracts can be adjusted and reviewed as required.
A.chievable / Attainable – what skills are
needed / what resources are required?
Professional well trained staff
Efficient technological systems
Transparency and open communication between
relevant stakeholders
Mitigate issues with working solutions
Alter strategy if required
Improve internal communications and staff culture.
Change management could be improved. Organisation
culture tinged with low morale but otherwise staff
efficient and professional.
R.elevant – is the goal in alignment with
the overall strategy?
All goals in line with overall strategy.
Goals and objectives reassessed on regular basis with
use of risk register and other performance tools
Goals and objectives can be reviewed and adjusted
during planned performance or audit.
T.ime bound – is the deadline realistic?
Tight governmental deadlines – little room for
maneuver or error. Key milestones set at realistic and
achievable levels but new emerging contracts can be
adjusted and reviewed as required
Any issues to be raised with Sub Executive Committee
or Chief Executive Committee

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SWOT Analysis
It is important to identify the strengths and weaknesses in the internal aspect of the company as well as
highlight the threats and opportunities present within the external environment and for to illustrate
these points a S.W.O.T analysis is shown below. The landscape in which the company exists fluctuates
regularly due to the fluidity of its membership structure and the political canvas and therefore the
author has chosen to create three separate SWOT analyses depicting the three era’s of the company and
then provide a comparison analysis.
Strengths: attributes of the company that are helpful to achieving business objectives.
Weaknesses: attributes of the company that are harmful to achieving business objectives.
Opportunities: external conditions which are helpful to achieving objectives.
Threats: external conditions that could do damage to the business's performance.
Purchasing Department, Strathclyde Regional Council – 1975 - 1996
Strengths Weaknesses
 Centralized location
 No direct competition
 Use of SME’s
 Smaller contracts
 Limited number of contracts
 Multiple suppliers including many SME’s
 Staff familiarity with suppliers and end
users; more personable service
 Less bureaucracy
 Increased team autonomy
 Lower complaint levels due to higher
customer satisfaction levels – all issues
raised quickly and dealt with promptly due
to less formalized structure
 Positive staff culture
 Retained staff
 Distribution / logistical infrastructure
 Limited powers and governance
 Rogue spend on contracts
 Lack of savings / economies of scale
 No brand or image, a department within a
pre-existing local authority
 No carbon footprint awareness
 Untrained staff, clerical position only
 No KPI’s,contract milestones
 Everything done on paper, no/limited
technologies
Opportunities Threats
 New technologies becoming increasingly
available
 Introduction of internet and email
 Large public body sector
 Economies of scale possible but not fully
recognised
 Positive influence on prices / bargaining
powers
 Significant savings / rebates offered
 Credit crunch / recession
 Fluctuating market
 Membership stability
 Member cooperation
 Weather / geography
 Non compliance of contracts
 Inconsistent local policies – potential tension
 Difficulty influencing all local authorities
 Potential restructuring
 Negative media exposure
 Change in political agenda

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abc – 1996 – 2008
 New independent brand image
 High level of customer service – end user
focused
 Increased carbon footprint awareness
 Staff training introduced - CIPS
 Increased political support
 Relatively small contracts
 Limited number of contracts
 Many SME’s maintained on contracts
 Staff familiarity with suppliers and end
users; more personable service
 Increased bureaucracy team autonomy
remains
 Staff retained
 Limits to funding available
 Limits to devolved powers
 Local policies and bureaucratic process
hindering progress
 Increasing bureaucratic process
 Enough choice on contracts to mitigate rogue
spend?
 Limited powers and governance
 Rogue spend on contracts
 Lack of savings / economies of scale
 No KPI’s,contract milestones
 Still heavily relying on paper rather than
technologies available – lack of funding
 New technologies explored
 Up to date website also with full paper
catalogue
 Online facilities
 Economies of scale
powers
 New technologies becoming increasingly
available
 Increased use of internet and email
 Global economy / international market
restrictions / EU Governance
 Potential SME legal action
 Stakeholder resistance
At this point in time the company has evolved. It has become a body in its own right and has its own
branding for the first time. Staff are no longer seen as merely clerical support within a local authority
but now have their own professional titles within their own organisation. The contracts, albeit for more
newly created local authorities are still relatively small and many of the companies, suppliers, contacts
and end users remain the same. New technologies are available, however with limited funding for new
hard/soft ware, it will take a number of years before the company is prepared for the 21st century office.

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Scotland Excel – 2008 to present
 Strong brand image
 High level of customer service – end user
focused
 Carbon footprint awareness
 Sustainability leaders
 Trained professional staff – broad
knowledge base
 Satellite offices covering all corners of
nation
 Strong political support
 Limits to funding available
 Limits to devolved powers
 Local policies and bureaucratic process
hindering progress
 Bureaucratic process
 Overly stringent governance?
 Not enough SME’s on board
 Focus on price rather than quality –
reconsideration of weightings?
 Key milestones not reached - delays in
contract process
 Enough choice on contracts to mitigate rogue
spend?
 New technologies explored
 Up to date website
 Online facilities
 Economies of scale
powers
 Pro mass procurement political agenda
 Global economy / international market
restrictions / EU Governance
 Potential SME legal action
 Stakeholder resistance
As can be seen from the three separate analyses, there have been many changes to the Strengths,
Weaknesses and Opportunities over the past thirty nine years, however the threats have remained the
same and these probably will remain the same for the entire longevity of the organisation. The
company is at the mercy of political agenda and membership subscription, any fluctuation in these
support mechanisms could potentially have disastrous results.
The advantages of the SWOT analysis are that it is simple and flexible and it does not require specific
skills or training to create or complete. As can be seen the company has many potential threats due to
the volatility of its funding structure and political support. There are no guarantees that the political
situation may change or that members may decide to no longer subscribe, either of these two threats
could potentially bring an end to Scotland Excel. However, there have been many changes over the
past thirty years and, if anything, the company appears to be growing from strength to strength.

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Porters Five Forces (adapted model)
Michael Porter’s Five Forces business tool is a useful model for those organizations that wish to gauge their
competitive power and position within the market compared to their competitors. However, in a public sector
procurement environment where there is no direct competition, the model requires to be adapted slightly to
show the potential threats, rivalries and substitutions. The diagram below (McKevitt 2000) illustrates that
public sector departments can indeed fit into the models shown below:
It is noteworthy that there have been calls to again restructure and wholly centralize the procurement of all
category goods for Scotland under one large united procurement body. This in itself is a threat to the
organisation and its associated bodies.
Associated Procurement bodies in Scotland - ? Mergers & Acquisitions
Scotland Excel is one of the Scottish Procurement bodies in Scotland. Others include:
APUC – Advanced Procurement for Universities & Colleges
NHS Procurement
Scottish Prison Service Procurement
Scottish Government Procurement (Category A items only)
Scotland Excel does not have competition as it is the sole Category B procurement body for local authorities in
Scotland. Therefore there are no mergers or acquisitions. The procurement bodies in Scotland indeed work
together collaboratively and undertake “benchmarking” exercises with each other to ensure that no one
procurement body is paying significantly more or less than the others (as the majority of all the aforementioned
bodies use the same suppliers as well as distribution links).
A full P.E.S.T.E.L, detailing the shifting sands that have occurred over the past thirty years is shown
below.

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PESTEL Company Pre 1996 1996 - 2008 2008 →
POLITICAL
Primary Conservative Party, Westminster
rule. Purchasing is an administration
process. Very little moderation or
supervision. No major strategic structure in
place. Buy what is wanted and needed for
each department using basic tendering
processes. Little public awareness of
processes involved.Poll tax changes to
council tax. Focus on the public purse
highlighted in media.
Predominantly Labour Party rule, however
devolution to Labour / SNP during this time.
Political shift towards processes and strategic
mass procurement. Stronger governmental focus
on savings and cost cutting. SME's become an
issue for the first time. Concerns raised that only
large suppliers can tackle distribution. Raised at
government level. Restructuring of local
authorities. More jobs required. Increased
bureaucratic process. Freedom of Information
Act 2000. Changes in variety of employment and
data protection laws.
Continued Governmental change and
influence. Procurement report and SNP
support for Scottish procurement function per
commodity category. EU legislation and fair
trade have increased political influence and
pressure considerably. Governance of
company tightly moderated and scrutinised.
Every contract and penny monitored through
key milestones and sign off dates. Move to
appease SME's as this is a growing concern.
Major contracts only won by large firms.
Moves towards framework agreements to
include SME's. Increased bureaucratic
processes hinderchange.
ECONOMIC
1989 market crisis reduces household
incomes due to unemployment. Free school
milk ends. Milk contracts nowrequire to be
tendered. Stakeholders dissatisfied.
Time of "boom" as markets improve and
unemployment at all time lows. Higher
disposable income and GDP. Economies of scale
and mass procurement mean that smaller
businesses previously used are now no longer
receiving business and are feeling under financial
pressure. There are both positive and negative
impacts on SME's.
Time of economic crisis. Unemployment
rises, reduced disposable income. Reduce
GDP. Higher awareness of the organisation
and pressure of business to cut costs,reduce
staff and increase work load to increase
savings. Horsemeat scandalbecomes national
political focus and Excel receives negative
press due to contract choices and other internal
misdemeanours. Low interest rates.
SOCIO-CULTURAL
Little consideration for social economic or
cultural factors. A one-size-fits-all
approach to procurement. Companies only
dealing with central belt and south westerly
regions, no concern for other areas with
potential diverse needs. Healthy eating less
focused and price is key, not quality of
product.
Shift towards healthier meals for schoolchildren.
Healthy living and diverse cultures and belief
systems within education/socialenvironments
require increase awareness and planning of goods.
Population increase with public living longer.
Focus on social welfare and social care needs.
Increased awareness of green and ecological
products.
Immigration and population rate increase.
Diversity in all contracts required. Public
awareness of all health related matters now
paramount due to media and government
pressures. Lifestyle choices, ethnic minorities,
religion and belief systems changing
considerably.

17
TECHNOLOGICAL
The computer is introduced to the main
stream office in the late 80's. The
procurement process until this point is
purely pen and paper. No mobile phones,
no email. All communication is either over
the telephone,face to face or by fax.
Mobile phones and email are in everyday use in
the office and for staff out and about. Reliance on
technology increasing. Reduced face to face
contact with suppliers and stakeholders.
Considerable business spend on up to date
information and mobile technologies. Increased
members of staff requiring to work from home or
have communication device. Cost implications to
business. Training issues raised. IT staff required
to be hired. Legal implications of misuse of
technologies raised and highlighted. Upkeep
costs. Safety concerns raised.
Video conferencing reduces face to face
meetings of senior staff from local authorities
- costs considerably. Initial costs but cheap to
maintain and use. Staff can access internal IT
from home and use smart phones to access
urgent materials. Safety of information
paramount. Security against breaches and
hacks a priority. Technology increasing faster
than the budget to pay for it. Schools and
other public sector sites expecting all
technologies,increasing budgets
exponentially. Creation of eCatalogues and
PECOS only purchasing.
ENVIRONMENTAL
Very little consideration made to
environment. Green alternatives not readily
available on market and too expensive to
use in public sectorprocurement. Little
awareness or social focus.
Increased awareness of global changes and
pollution. More social and media focus.
Recycling implemented and a few greener options
available on certain procurement contracts,
however these are too costly and hence rarely
used.
Weather, Climate change, laws regulating
environmental pollution, WEEE, recycling
initiatives, waste management contracts,
changes in attitudes towards greener and
ecological products within public sector
environments, changes in attitudes towards
renewable energy. Internal "environmental"
group created to monitor waste and energy
within organisation
LEGAL
Employment and health and safety laws
implemented.
Increase in variety of legislation to protect
employee as well as contract end user. Blame
culture increases and "suing" becomes more of a
social norm. Consumer protection and e-
commerce laws come into effect.
Freedom of Information Act invoked on many
aspects ofthe tender and contract process.
Unsuccessfulsuppliers and contractors have
legal right to access files and raise concerns
about processes. This can slow entire contract
process down considerably and can be seen to
be more of a hindrance than a help. Increase
in maternity/paternity/adoption laws. Changes
to sexual/race/ethnic discrimination laws -
increase in organisational grievances.
Company more open to scrutiny and
speculation in light or horsemeat scandal.

18
Scotland Excel’s response to impact of PESTEL factors
As can be seen from the above three columns, there have been many changes from the early stages of the
purchasing department through the corporate entity that is Scotland Excel. As the political, economic, socio-
economic, technological, environmental and legal landscapes have evolved, the organisation has had to evolve
and adapt also. Pre-determined and planned strategies have had to make way for emerging strategies to cope
with new demands and expectations from end users and stakeholders.
As the organisation expanded departments were created; in many respects the organisation became an
independent autonomous entity. New technologies required to be purchased and staff had to be trained how to
use these. However technologies (hardware and software) fall into obsolescence rapidly in today’s market and
Scotland Excel struggles to maintain the pace. As the company is funded solely through the subscriptions of
member authorities, it cannot be seen to squander income on updating systems when staff and creditors have to
be paid, especially given that the public body sector is closely financially scrutinized and there must be a
tradeoff between what is desired and what is required.
The mass scale of procuring goods for 32 very different local authorities is a great challenge. When Strathclyde
District purchased goods for the central belt of Scotland it did not have to factor in distribution and delivery
costs to the highlands or the islands. Many suppliers on the current contracts have to use haulage companies and
sub contractors to get their contracted goods over the water or up to the most northerly points of the country and
this has caused logistical problems for all parties concerned. Poor weather, transportation and distribution issues
are reported on a very regular basis. Companies only used to dealing with lowland central locations are now
having no option but to change their systems and logistic protocols to adapt to contracts.
An alternative model for strategic management is the Proposed Strategic Management Model for Public Sector
(Poister, T, H. & Streib, G, D. March 1999) as shown below. The authors of the model state:
“Strategic management is not a linearprocess of planning, implementation and evaluation. Rather it entails
managing a public agency froma strategic perspective on an ongoing basis to ensure that strategic plans are
kept current and that they are effectively driving other management processes… The overall purpose of strategic
management is to develop a continuing commitment to the mission and the values of the organisation ...”
At the “core” of the model are the values, the visions and indeed the mission statement of the organisation.
Upper Right Quadrant: concerns all external relations with organisation including customers, public
relations, intergovernmental relations as well as legislative agenda.
Upper Left Quadrant: concerns human relations elements such as human resources development,
labour relations, organizational culture and internal communications.
Lower Right Quadrant: concerns management responsibilities, program planning and evaluation,
service delivery systems, programme and project management and all
performance measures.
Lower Left Quadrant: Concerns internal management functions including performance management,
budgeting and financial management, administrative processes and
organizational structure.

19
The challenge for the Strategic Management within Scotland Excel will be to monitor both the
internal and external environments continually. For the organisation to work efficiently and
effectively all systems, departments and stakeholders should be working in optimal synchronicity to
achieve best performance. If even one of the above “quadrants” is not nurtured then this could be
detrimental to the overall balance and indeed success of the business.
There are other models (such as Miles and Snow or Digital Strategy) that could be used to illustrate
the strategic management style of an organisation, however many of these are best utilized in a for-
profit organisation and therefore are not particularly relevant in this report.

20
Strategic Direction – Methodology – Underpinning Issues
As described within the Purpose, Visions and Values (in Introduction), the mission of the company is to work
collaboratively with suppliers and members to provide the best procurement service with the best prices to
achieve the best savings. This report shall now briefly focus on each aspect of the organisation to discuss how
this strategic methodology is achieved.
The Decision Makers
As can be seen from the Free mind Map (Appendix B), Scotland Excel is a complex organisation that is
responsible to a number of official bodies at both local authority level as well as political and national
Government level.
The organisation cannot make any strategic decisions without discussion and agreement by a variety of
committees that were put in place not only to audit the company but to ensure that the needs of the Scottish
public (and its purse!) are being fully realised and safeguarded. The very remit of the organisation is to save
money by working with suppliers to cut costs, which is to the benefit of every resident of Scotland.
Internal & External Stakeholders (list not exhaustive)
The company is a public sector body and therefore does not have any shareholders nor indeed is floated on any
kind of FTSE market. This does not mean, however, that the company does not have its fair share of internal
and external stakeholders and shown below is a list (not exhaustive) of these groups ranked from Power (top
down) to Interest.
European Union (fair trade legislation)
Scottish Government and all associated members (Scottish and UK)
Political parties (opposing / current government)
Member local authorities
Potential suppliers – foreign and domestic
Associate Members (i.e. Fire Service, and non profit organisations)
Creditors (of both current suppliers and Excel)
Suppliers – current and potential
Service providers (internal and external)
Public body customers (inc. Education and social work)
All contract end users (school children, care home residents)
All staff members (and their families)
The general public (looking after the public purse to ensure that money is saved on contracts to be used
elsewhere!)
The below public sector stakeholder map illustrates a portion of those with some kind of investment in
Scotland Excel. (Map taken from National Co-ordinating Centre for Public Engagement website 2014).
POWER
↓INTEREST

21
As a non-profit organisation there are many stakeholders to whom the organisation would be held
accountable should strategy fail. As part of continual contract management and evaluation, Excel strive to
continuously to define, analyze, manage and engage with the above list of stakeholders. Regular meetings take
place in a variety of forums, media and marketing events to ensure continued support and cooperation from all
viable parties.
Organizational Culture
“the ends justify the means” (saying attributed to Niccolo Machiavelli 1469 - 1527)
A shift in organisational culture occurred in the organisation that became apparent subsequent to the change
over from abc to Scotland Excel (and especially under the new management of Dorothy Cowie) from early
2008 onwards. abc, being a smaller and less formal framework was less marketed and branded prior to the
change and this more casual and relaxed approach to working was clearly identifiable in the staff culture.
Managers were friendly with lower graded staff and groups of employees would socialise with each other
without any scrutiny or consideration that this would be seen to be inappropriate. However, under new
management with new Senior Executive staff (and in new open plan premises) this relaxed – and less
stressed – culture evaporated to the extent whereby Managers were directly warned that it was inappropriate
to socialise with lower grade peers. Scotland Excel indeed is a far higher profile company than its immediate
predecessor and conflict arose quite rapidly. Communication issues have arisen with member authorities and
concerns have been raised that member authorities may indeed leave the collaborative network (see SWOT
analysis).
However, to discuss the general culture, Johnson, G Scholes, K and Whittington, R (2008) offer a framework
called the Cultural Web which can be used to “indicate the underlying collectively held taken for granted
assumptions , or ‘paradigms’” within an organisation. This model and concept are discussed in Appendix G.

22
Performance Measures
Scotland Excel contracts are measured again two internal types of KPI’s (key performance indicators).
Both of these measures were introduced in 2008/2009 when it became apparent that staff were struggling to cope
with the increased work load and demands of the new contract placement protocols. The measures that were
created were as follows:
Contract Milestones
Most contracts have a four year, nine months life cycle. The nine months aspect of this cycle is from Day 1 the
contract creation commencement date (the research phase) through to the contract commencement date. This
process should take no more than nine months. Within the contract process there are eight key milestones which
have to be met and achieved by specified dates. Failure to complete or meet these deadlines is subject to
discussion with the Directorate and potentially the Sub Committee for their approval. These dates are closely
monitored as to allow the Directorate to ensure that contract placement takes place in a timely manner as failure
to start the contracts on time can lead to inappropriate over spend. The actuallive contract can last either three or
four years (depending on the contract type) and the contract is managed every business quarter to check spend,
management information data and also to check for misspend out with the contract.
K.P.I’s – Key performance Indicators
These were created to monitor and analyze other strategic aspects of the company’s performance and include:
Overall contract estimated values
Cumulative contract quarterly spend
Cumulative contract quarterly savings
Staff sickness rates
User Intelligence Group feedback score cards
Contract milestones – breakdown per commodity per procurement team
These KPI’s were amended and updated on a quarterly and annual basis and were a useful tool to illustrate where
improvements could be made within specific teams and also where the best savings were being achieved.
These performance measures were purely internal; however the company is also audited by Renfrewshire
Council as well as an external agency on an annual basis to ensure that all policies, procedures and finances are
up on date and legally binding.
The S.M.A.R.T objectives of the organisation and includes the major milestones that the Strategic Manager and
Executive team must consider at all times.

23
Ansoff Matrix
Igor Ansoff created the self named matrix as a strategic planning tool to assist executives, senior management
and decision makers to devise strategies for future growth.
Courtesy of http://www.edrawsoft.com/images/circular/Ansoff-matrix.png (2014).
Albeit Scotland Excel is a public sector body that does not technically buy or sell products, the very business of
the organisation is to search the market for products that can be procured and sold en masse to the public.
Working with the Scottish Executive, the company continuously strives to increase its contract portfolio by
searching for ways to save the public purse money through diversification of its portfolio and service mix.
Once potential commodities have been investigated, the current Members (existing markets) have to be
approached to find out whether or not they would be interested in participating in these potential contracts.
Also, the company works with existing Members to find out which commodities they would be interested in
Scotland Excel procuring on their behalf.
Influence of Management Data on Financial Strategy
Suppliers submit sales data to the company on a quarterly basis. The data is submitted electronically and the
information is extrapolated and analyzed to identify which items are selling the most/least. The identification of
these best/worst sales allows the staff to potentially negotiate reduced prices for the items most sought or indeed
removal of items entirely from the contract to eliminate waste and potential rogue spend. Indeed if a pattern of
rogue spend emerges, it may be that end users prefer a particular item because of quality. This particular item
may be added to the contract and its original counterpart removed with a better price negotiated for the
replacement. This is an ongoing process and allows for flexibility with both supplier and end user to ensure that
all stakeholders are satisfied with the contract management process. The Ansoff Matrix could be considered a
visual representation of this process linking existing members, potential members, existing products/services with
potential diversification and expansion of these products/services.

24
Thompson’s Desirability Model
A further visual representation of Excel thinking could possibly be Thompson’s Desirability, Feasibility and
Viability model (shown below). During Strategic Procurement Executive meetings the various stakeholders
(Excel staff and User Intelligence Group members) discuss the variety of contracts/products that they wish to
procure. The products and services required could come under the three headings.
This proactive model could also be used through the contract management process to assess the continued
performance and viability of each contract in place. This model could theoretically used in conjunction with the
KPI data or indeed the contract management information data as the latter is a detailed description of
product/service update by end users.
Change & Conflict
The organisation has undergone considerable changes over the years and has evolved from a small
department within a large organisation into a large entity in its own right. Strategy at these times of
change have focused primarily on the day to day function of the business to ensure that all services and
contracts run as smoothly as possible, however the impact that these changes have made on staff were
overlooked and it was soon apparent that there were manifestations of conflict within all levels of the
hierarchy.
Change and conflict is discussed in Appendix F of the report.
Strategic reflection and potential recommendations are discussed after the conclusion.
EVR Congruence
An alternative model that Excel could potentially use was first devised in the early 1980’s by David A. Nadler
and M. L. Tushman. This tool could assist Excel in understanding where a problem lies either within a team or
the organisation as a whole and can help find a solution; this may be particularly useful at times of conflict with
either internal or external stakeholders.
Appendix H provides an illustration of this model as well as a breakdown of how this could be implemented by
Excel.
Desirability: what products/services do the
end users require? Is there a mass scale of
need across the nation that would justify a
mass procurement venture? Would we make
savings on economies of scale?
Feasibility: Could the logistics and
distribution networks currently in place cope
with this product/service? Do we have the
correct resources to cope with this contract?
Is specialized training required?
Viability: Does the “end justify the means”?
Will there be enough significant savings to
justify the process and resources required?
Will all members agree to use this contract if
it is put in place? Is it a realistic choice – are
there any options/alternatives?

25
Balanced Scorecard
The Balanced Scorecard is a full planning and management system that was created in Harvard Business School
in the 1990’s and is used by organizations as a way to align, monitor and achieve business objectives and
strategies.
The above is courtesy of Robert S. Kaplan and David P. Norton (January-February 1996).
To achieve a balance throughout the organisation, Scotland Excel must align its strategic systems (as shown in
the above diagram). Any one aspect that is out of kilter will have a detrimental effect on the business as a whole
and this aspect must be investigated and realigned to ensure a holistic and unified business.
Financial performance: The company must create and maintain best savings to ensure ongoing
subscription from members. These savings are monitored in KPI’s.
Customer Satisfaction: End users complaints are monitored via KPI’s and are dealt with at contract
management meetings.
Knowledge and Innovation: Professional and trained staff working with limited resources and tight budgets.
Internal Processes: Laborious and bureaucratic – room for improvement.
See Reflection and Potential Strategic Organizational Recommendations on page 24 for further
recommendations the author would make to balance the corporate scorecard.

26
Conclusion
Each year in Scotland approximately £9 billion is spent on the delivery of all goods and services required to
support the major public services in Scotland. The money spent by local government to purchase the goods and
services required to deliver services to their communities’ accounts for around half of this amount.
Scotland Excel is a large national procurement body designed specifically with the task of dealing with the
procurement of all Category B commodities (see Appendix C).
As a public sector not-for-profit organisation dealing with all thirty two local authorities (including all highland
and Island far reaching communities) the organisation must have clear, strong, committed and focused strategies
to deal with all contingencies. Albeit there are no shareholders, the business nonetheless has a variety of
stakeholders that require to be satisfied (and appeased as necessary) at all times. The company deals with
contracts that have a combined value of over £235 million pounds per annum and it is their responsibility to save
the public purse a significant percentage of this through mass procurement and economies of scale purchasing.
This report has detailed the history of the organisation, its creation, the metamorphosis required in 2008 as well
as its internal and external structure. The author has briefly outlined the many facets of the company to give a
snapshot of a business that is faced with multiple internal and external challenges that must be overcome and
conquered on a regular basis to ensure its very existence and successful longevity.
The report provides a breakdown of the strategic methodologies used and illustrates these with a variety of
management models such as PESTEL, SWOT, Porters Five Forces and Ansoff in an attempt to show that the
company must consistently navigate through a tempestuous political and financial climate to provide its service
effectively.
The main body of the report has also provided answers to the questions raised in the Executive Summary to
discuss and analyze the overall strategies of the organisation.
Reflection and potential recommendations for future strategy are noted subsequent to this conclusion.
In summary, Scotland Excel has been overall successful in its implementation of strategy of the years.
The organisation has grown, restructured and evolved over the years from a basic administration
function to a nationally recognised, award winning governmental institution.
As the country slowly emerges from a time of financial recession, the company has worked to
maximize the products and services available to the public sector whilst attempting to reduce the cost
to the public purse. Given that the nation is now recovering from the financial crisis, Scotland Excel
will continue to work within its remits to produce the outcomes required and, where necessary, shall
evolve strategically to meet the needs of our nation.

27
Reflection and Potential Strategic Organizational Recommendations
As noted in the S.W.O.T analysis, Scotland Excel has many areas of weakness and potential threat. The
contingencies in place to deal with any of these are not immediately obvious, indeed many cannot be controlled
(i.e. external agencies, weather, global market etc), however it is assumed that a sufficient Risk Register has
been devised to cover as many negative outcomes as possible.
However, the author notes that areas whereby small strategic improvements could be made include:
Internal
1. More staff/team strategic focus. Low staff morale could potentially be improved by work place culture
emphasis. Internal relationship management may improve/change under the new Director but the culture
itself may be slow to adapt.
2. Performance measures are very restrictive and the constant internal auditing of all aspects of work
wastes resources when staff are already under considerable pressure to perform. By allowing some
autonomy and allowing Managers to make team based decisions without the need to have these “signed
off” could greatly reduce KPI and contract milestone times.
3. In house training / shadowing. To reduce intra-team goal focused behaviour, staff from all divisions
should consider cross functionality and spend time shadowing counterparts in other areas. This would
allow each staff member to have a new perspective of the company and allow a true unified
understanding of the mission statement, visions and values.
4. Streamline digital systems. The shift from paper catalogue to electronic systems has been slow with
limited resources. Focus should be on streamlining all digital systems to bring in line with the
progressive 21st
century business. Reliance on paper copies should be minimized as this will enhance
sustainability and environmental strategies.
5. The organisation is results focused and uses many qualitative measures to gather and analyze outcomes.
Are all these measures being utilized correctly or indeed are they all necessary? These performance
measures should be reconsidered and streamlined as necessary as to ensure that they are not just a waste
of resources. Also strict adherence to KPI’s and other data management timelines are jeopardized with
the lengthy bureaucratic processes implemented by the governance structure.
6. The chain of authority or indeed autonomy could be investigated as cutting down on ‘red tape’ may
improve performance and possibly relieve staff of time line pressures.
7. Internal audit ensures that the business strategies (administration and finance) are recorded and approved
appropriately. At the end of every contract a “lessons learned” exercise is carried out to review all
aspects of the contract to improve and streamline processes.
8. Consider using less external agencies (i.e. project “Consultants”) at high cost. Consider using in house
skills and creation of internal project teams. This will save money and make use of own high level of
resources.
External
1. Standardization of “local policy”. Thirty two local authorities all with their own standard procedures
and protocols some of which directly oppose Scotland Excel’. These procedures hinder progress and
increase contract milestone waiting times.

28
2. Work to improve Member relationships. Shift focus from the creation of new membership to the
maintenance of those currently in existence. The business is built on the subsidies and subscriptions of
paying members and good communication and trustworthy bonds is imperative.
3. Consider contingencies required to deal with all threats – i.e. have robust Risk Register.
4. Increase awareness of political landscape. The company is closely scrutinized by high power political
stakeholders and is accountable for all losses as well as all savings. The possible future changing of
government could have an impact on the future of the business.
5. Continued stakeholder involvement and communication throughout the lifespan of the contract
management process ensures that all elements of the procurement strategy are dealt with effectively and
efficiently.
6. Annual audits by governmental led bodies ensure non biased and full inspection of all aspects of the
company. Benchmarking exercises also carried out with associated procurement bodies to share
knowledge, experience and strategic approach. All staff from all procurement bodies share the same
education standard (Chartered Institute of Purchasing Specialists) and this aims to ensure a consistent
approach across the field.
7. Consider increased inclusion of SME’s on all contracts. This will reduce local authority and small
business tensions and increase positive community exposure.
8. Continue and improve “lessons learned” practices but involve external stakeholders (suppliers and end
users) also. An open and transparent communication between all parties will improve relationships and
future outcomes.

29
References& Bibliography
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System, Harvard Business Review p76
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Thompson, J. L & Martin, F (2013) Strategic Management – Awareness and Change,(6th Edition); Thomson Learning
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Witcher, J, Chau, V. (2014) Strategic Management - Principles and Practice Change, (2nd Edition), London: Cengage
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Available from:
http://www.publicengagement.ac.uk/
[Accessed:28/10/14]
Go Awards (2014) [Online]
Available from:
http://www.goawards.co.uk/
[Accessed:28/10/14]
The Scottish Government (2014) [Online]
Available from:
http://www.scotland.gov.uk/Topics/Government/Procurement Tendering for Public Sector Contracts:
[Accessed:28/10/14]
Gov.uk (2014) [Online]
Available from:
https://www.gov.uk/tendering-for-public-sector-contracts http://www.publiccontractsscotland.gov.uk/
[Accessed:28/10/14]
The Charted Institute of Purchasing and Supply: [Online]
Available from:
http://www.cips.org/
[Accessed:28/10/14]

30
Guidance on the Use of Compulsory Purchase; a Consultation Paper (2014) [Online]
Available from:
http://www.scotland.gov.uk/resource/doc/96269/0023302.pdf
[Accessed:28/10/14]
The Scottish Government (2014) [Online]
Available from:
http://www.scotland.gov.uk/Resource/Doc/341578/0113608.pdf
[Accessed:28/10/14]
BBC Website - Horsemeat Scandal - BBC news (2014) [Online]
Available from:
http://www.bbc.co.uk/news/uk-scotland-21561405
[Accessed:28/10/14]
Scotland Excel response to Horsemeat Scandal (2014) [Online]
Available from:
http://www.scotland-excel.org.uk/web/FILES/Briefing_Note_-_Scotland_Excel_food_contracts.pdf
[Accessed:28/10/14]
Procuring Foster Care (2014) [Online]
Available from:
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[Accessed:28/10/14]
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/Scotland_Excel.pdf
[Accessed:28/10/14]
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C:UsersUserPicturesdesirability-feasibility-viability-diagram.gif
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[Accessed:10/11/14]

31
31
Appendices - Appendix A – Map ofLocal Authorities

32
32
Appendix B – Freemind Map – Scotland Excel Governance & Funding

33
33
Appendix C – Commodity Categories
Procurement Categories are broken down as follows (information taken from Scotland Excel website):
Commodity categories
Within his report on public sector procurement, John F McClelland CBE categorized the goods and services
procured by Scotland's public sector into three groups.
These categories provide guidance on where contractual responsibility should lie for the procurement of
different types of commodity. As well as providing a strategic framework for public procurement activity, they
can also help suppliers identify which organisations may have tender opportunities for their products and
services.
Category A
These are goods and services that are commonly used across the whole of the public sector. IT services,
utilities, office supplies and telecommunicationsare included in this group. The Scottish Procurement and
Commercial Directorate manages all Category A contracts in Scotland, and a directory is available on the
Scottish Government website.
Category B
There are goods and services that are commonly used across a specific sector for example, medical supplies
used by the NHS or laboratory equipment used by universities and colleges. Scotland Excel is responsible for all
Category B contracts for local authorities.
Category C
These are goods and services for which contracts are established at a local level by a single organisation. In the
local government sector,individual councils are responsible for developing and implementing Category C
contracts. However, councils may work together to implement a collaborative contract on a regional level,
(Category C1).
Scotland Excel Estimated Contract Values & Savings
"Scotland Excel is well placed to help local authorities reduce procurement costs at a time of significant
pressure on public sector budgets." Dorothy Cowie, MD (2008)
A submission by Scotland Excel to the Scottish Parliament in December 2011 outlines the key features of the
business and a breakdown on the contracts available to all 32 local authorities.
http://www.scottish.parliament.uk/S4_LocalGovernmentandRegenerationCommittee/General%20Documents
/Scotland_Excel.pdf
The estimated value of these contracts will be in the region of £235 million per annum with anticipated savings
of approximately £20 million per annum. From 2011 the commodity list has grown and expanded considerably
and Scotland Excel now deals with the following 39 contracts:

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Appendix D – Contract List – as at 2014
SCOTLAND EXCEL CONTRACTLIST
 Advertising Services
 Asbestos
 Bitumen Building and Timber Materials
 Catering Sundries
 Domestic Furniture and Furnishings
 Education and Office Furniture
 Education Materials
 Electrical Materials
 Engineering Consultancy
 Fostering
 Frozen Foods
 Groceriesand Provisions
 Heavy VehiclesHousehold
 WEEEand Batteries
 Hygiene Products
 Light Vehicles
 Meats(incl. Fresh Fish)
 Milk
 Organic Waste
 Paint
 Personal and Protective Equipment
 Plumbing Materials
 Prepared Meals
 Presentation and Audio Visual Equipment
 Road Maintenance Materials
 Sacksand Liners
 Salt for Winter Maintenance
 Secure Care
 Security
 Signage
 Street Lighting Materials
 Tele care Equipment
 Tyres
 Vehicle and Plant Hire
 Vehicle Parts
 Washroom Solutions
 Waste Containers
 Waste Disposal Equipment

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Appendix E – McKinsey's 7S Framework – Scotland Excel
Shared Vision – Common goal – best savings, best
practice.
Skills – Professional, educated, best practice – legal,
ethical, timely.
Style – Formal, hierarchy – key milestones and
performance closely monitored – autocratic – little
autonomy.
Staff – CIPS accredited and experienced procurement
staff – specialized commodity and stakeholder
knowledge.
Strategy – The plan(s) devisedto keepbusiness working
holistically towards common shared vision.
Structure – The bones of the business and functional
reporting structure.
Systems – Daily activities undertaken by all
departments/employees to work towards shared vision.
Key
Red = Hard Elements – elements that are easier to define, identify, manage or influence
Blue = Soft Elements – elements that are harder to define, identify, manager or influence

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Appendix F – Change & Conflict
Butler & Rose (2007) state that conflict can take either of two forms.
Cognitive an action or ideological conflict – dislike of management plans, uncertainty about job, fear
of reprisal, sacking or redundancy
This form of conflict arose during the organizational restructuring whereby many long term employees lost
their jobs.
Affective emotional conflict between peers or groups; miscommunication, strong emotions can lead to
deep seated resentment and negative behaviours.
Staff became suspicious of each other at time when competing with each other for limited posts. The
emotional conflict between peers was palpable and grievances were raised.
Conflict which supports organizational goals and assists in performance improvement is known as functional
conflict. Dysfunctional conflict is conflict which does not support organizational goals and hinders
organizational performance. (Buchanan and Huczynski 2010). The conflict within Excel at the time of
restructuring was dysfunctional as many mistakes appeared during multiple contract processes and senior
members of staff were investigated and disciplined for these errors.
Some of the areas of organizational conflict are demonstrated below – table courtesy of Rollinson (2008):
Factors in Organizational Conflict (Rollinson 2008)
Scotland Excel has grown into a large successful nationally recognised and renowned organisation that works in
collaboration with a multitude of internal and external stakeholders. The company works in perpetuity with end
users and suppliers throughout the contract process to ensure that all strategic visions and values are met.
Conflict has been a significant issue over periods of change and restructure but the Directorate and Executive
Committee have worked within the appropriate political and legal guidelines to overcome the manifestations of
conflict within the organizational culture. Scotland Excel cannot exist without its Members and therefore must
facilitate best practice and savings at all time to ensure continued membership and success.
Working collaboratively with internal and external stakeholders to mitigate any (potential) conflict in a timely
manner is a recommended priority for Scotland Excel.

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Appendix G - Cultural Web – The Paradigm
For each element of the web a Scotland Excel an example has provided for both Internal and External
stakeholders.
Stories – Narratives and dialogues between parties regarding the organisation
Internal The discussions that take place between employees with regards to restructuring processes.
External The end user satisfaction with contracts / dissatisfaction with logistical problems.
Routines & Rituals – The core belief systems – the expectations of employee and/or customer
Internal Staff are expected to arrive at work within flexi hours and work core hours.
ExternalSuppliers and customers expect to be greeted and treated in a courteous professional manner.
Control Systems - How tightly controlled are the processes / procedures within Excel
Internal Strategic key milestones tightly control all aspects of the contract creation process
External Customers can only purchase items through their Oracle based procurement systems to avoid error
purchasing and over spend.
Organizational Structures – Hierarchical structure within Excel
Internal Relatively flat (four tiers) structure; formal mechanistic and bureaucratic processes.
External Local authority bodies – generally hierarchical and formal – depending on site.
Power Structures – Where does the power lie within or out with Excel?
Internal Managing Director has complete responsibility over contracts and employees.
External Chief Executive Committee, Sub Committee group and Scottish Government have final say.
Symbols - The jargon and symbols used within the organisation
Internal Very contract law based jargon. Processes bureaucratic and administration heavy.
External All end users required to use procurement systems compatible with e-Cats (electronic catalogues)
produced and supplied by Excel via group emails. All end users must be aware of the codes and
jargon within these documents to use contracts correctly.

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Appendix H
EVR Congruence
Environment
Values
Resources
Diagramcourtesy of Mindtools (2014)
This model can work in a very similar way to McKinsey’s 7 S’s model and requires an alignment of all drivers for
optimal organisational performance and has a three step process. The following information is a summary of
Mindtools, specific to Scotland Excel.
Step 1 Analysis - common questions that could be considered:
Procurement requires complex knowledge and skill – is this present throughout organization?
Is work mechanistic or is there room for creativity, ingenuity, autonomy or initiative?
How is the work disseminated, categorized and distributed? Is there a better way?
Do the KPI’s cause a conflicting work approach? If compromises have to be made, which is more important, quick,
thorough or precise?
People: Scotland Excel has a fully trained staff contingent but are the Directorate aware of what types of people are
currently performing the organization's critical tasks.
Who interacts to get the work done? Bosses, employees, peers, external stakeholders.
What skills do the people possess? Knowledge, experience, education, competencies.
What are these people's preferences and expectations for compensation, reward, career progression, recognition, and
organizational commitment?
Organizational Structure: The formal structure, systems and processes that support the organization.
How is the company organized? Mechanistic or organic.
Are there distinct business units or other separations? Regional, functional, by product, by market.
How distinct and/or rigid are the lines of authority?
How standardized is the work? Rules, policies, procedures.
How is work measured and incentivized and rewarded?
Culture: The unwritten rules that define how work is really done – the attitudes, beliefs, commitment, motivation etc,
as well as the formal elements of process and structure. This element is the hardest to change but often the one with
the most influence.
What do people really do to get work done?
How does information flow around the organization?
What are the beliefs and values of individuals in the organization?
Varying leadership styles within the teams as well as the structure as a whole
The office politics
Step 2 Analyse howeach element relates to the business
Work and People: Are the right people in the right teams to maximise successfuloutput?
Work and Structure: Is the organisational structure beneficial to the teams, is structure maximising resources?
Structure and People: Are teams and members working together effectively within the structure?
People and Culture: Does the organisation have a positive and productive culture?
Culture and Work: Does the culture support the nature of the work that needs to be done?
Structure and Culture: Do the formal and informal structures work cooperatively or do they compete?
Step 3 Scotland Excel Directorate should devise and maintain congruence
Reinforce the congruence and change the incongruent, build in mechanisms to ensure continuity of congruence.

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