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TOWNSVILLE CITY COUNCIL SUSTAINABLE PURCHASING TRAINING MODULE

TOWNSVILLE CITY COUNCIL SUSTAINABLE PURCHASING TRAINING MODULE. 1. TRAINING OVERVIEW. TRAINING OVERVIEW.

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TOWNSVILLE CITY COUNCIL SUSTAINABLE PURCHASING TRAINING MODULE

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  1. TOWNSVILLE CITY COUNCIL SUSTAINABLE PURCHASING TRAINING MODULE

  2. 1. TRAINING OVERVIEW

  3. TRAINING OVERVIEW 1. Introduction to Sustainable Purchasing (SP)2. SP: What is it & Why practice it?3. Overview- Good SP Practices4. SP Principles5. Including the Environment in Procurement Policies & Planning6. Writing Specifications7. Tender Evaluation8. Make sure you get what you paid for9. Bringing it all together

  4. OBJECTIVES The purpose of this training is to help you:Understand what Sustainable Purchasing (SP) is;Appreciate the reasons to support it; &Be able to apply the Principles of SP in procurement policies & practices, that is,how to do it!

  5. SP- WHAT IS IT & WHY DO IT? Sustainability- Triple Bottom Line (TBL) in Public Disclosure.Q: What is Unsustainable?Sound Management Systems include the Environment, as well as WH&S & Quality Systems;Competitive Advantage;Environmentally Responsible Businesses;Image, Grants & Support for Local Business.

  6. WHAT IS SP? SP means integrating environmental/health considerations into purchasing decisions.Sustainable Goods & Services (G&S) are those that have a lesser or reduced effect on human health & the environment when compared with competing G&S that serve the same purpose.

  7. WHY DO SP? Purchasing G&S that satisfy value for money (V4$) criteria but also include sustainability;Save $- improving efficiency & reducing costs- landfill charges & on-sell recyclablesBetter manage environmental risks;To ensure the public image of TCC as a leader in environmental management & a responsible corporate citizen;To provide an example to other businesses, industry & the community in promoting the use of sustainable G&S;

  8. BARRIERS/MOTIVATORS Changing behaviours in an organisation not only requires an understanding of the levers that can push the desired changes but also a knowledge of the barriers.If you wish to improve your organisation’s SP performance, it is worthwhile understanding the reason to support it, the barriers against it & finding ways to overcome these barriers (CBSM).

  9. KEY POINTS SP means integrating environmental considerations into purchasing decisions.Sustainable G&S have a lesser/reduced effect on human health & the environment when compared with competing G&S that serve the same purpose.There are sound reasons for organisations to support SP which include V4$, environmental leadership & risk management.

  10. GOOD PURCHASING PRACTICES Planning the PurchaseDrawing up SpecsTender Evaluation Plan (TEP)Tender Evaluation ProcessManaging the Successful TenderFeedback loops

  11. SP PRINCIPLES Waste Management- Life Cycle Analysis (LCA/C2C)Recycled vs RecyclableFuture Costing- life timeManaging Environmental RiskMeeting Sustainability CommitmentsWater/Energy/CO2e reductionHaz Subs reduction EMS ISO 14000Stewardship- Due Diligence/Care/GED

  12. Price (cost neutral) Transport Installation Insurance Operational costs Energy Efficiency Water Efficiency Service & Maintain Spares Waste Mgt (WM) Durability After sales support Long Term V4$ Reusability Recyclablity Warranty Env & OH&S Risks EIA- 249P Corps Act Performance Image VALUE FOR MONEY (V4$)

  13. KEY POINTS • WM Principles should guide procurement planning so that strict avoidance of waste is the highest priority & disposal to landfill the least favourable option. • When costs of G&S are compared, it should not only relate to price but to all other costs during use of G&S. • SP as part of Environmental Risk Mgt strategy • SP most effective at front end of procurement process, where relevant policies incorporating sustainable principles direct procurement.

  14. ENVIRONMENTAL POLICY • “Environmental Considerations will be taken into account in investment & corporate strategies & in the purchase of G&S” Australian Post Environmental Policy • “The organisation is committed to purchasing G&S that reduce environmental impacts & contributes to the socio-economic development of Brisbane City Council”

  15. SP POLICIES & PLANNING • Service Level Agreements (SLA) & Standards of G&S • Specifications • Quantities [Q] (measurable) • Verification (competent person) • Evaluation- Tenders • Re-evaluation • Reporting- feedback

  16. TOP DOWN COMMITMENT • Purchasing Policy • Behavioural/cultural change • Change Agents/Champs • “Rewards” • Contracts • Education • Promotion • Involvement- design & implementation • Tools- ecospecifier

  17. ENVIRONMENTAL ISSUES • Environmental Policy- Corporate/Business Units • Information (tools) • Current Product Performance • Payback timeframe • Price Premium- up-front cost • Considerations- next sheet

  18. Is it needed at all? Life-cycle costs? Waste prevention? Toxicity? No virgin material? Sustainable harvest? Recycled/recovered? Reusability? *Greenhouse gases = Recyclability? Durability? Energy Rating? Water Rating? Disposal (package)? Clients Needs? Alternatives? CO2e*? Equivalent CO2 Q’s BEFORE PURCHASING

  19. OFFICE: A4 COMS PAPER TOILET TISSUE STATIONARY TECHNOLOGY SPARE PARTS LIGHTS ELSEWHERE: PARKS CONSTRUCTION FLEET TARGET G&S- OFFICE

  20. SUSTAINABLE G&S • ecospecifier www.ecospecifier.org • ecoBuy www.mav.asn.au/buyrecycled • AGO www.greenhouse.gov.au • www.greenprocurement.org.au/toolbox

  21. KEY POINTS • To be most effective, sustainability issues need to be considered in the policy & planning phases of purchasing. • By adopting a proactive stance to the establishment & use of SP policies, an organisation can ensure that SP becomes a reality. • SP will be most successful with top-level management support, as such people have the most power to influence policy frameworks & the general culture of the organisation. • Consider sustainability issues in your procurement planning. Review previous checklist. • Some types of goods such as paper, office equipment, landscaping materials, certain construction materials & rubber/tyre derived products particularly lend themselves to SP considerations

  22. ELIMINATING BIAS • Performance verses prescriptive specs. • Obstacles: colour, virgin paper, all-or-none basis, tight response & delivery times. • Over-Reliance on Track Record. • Cost considerations- cheap vs longevity: - Comparison shopping & bulk purchasing - Life-cycle (LCA) costing - Demand management (reduced volumes) - Longer term solutions- economies of scale

  23. SUPPLIER CHECKLIST • What is their Environmental Record? • What is the Environmental Impact of their G&S? • What is the Environmental Impact of their production process? • What are whole of life considerations? • What are Environmentally positive features of each G&S?

  24. USEFUL ADVICE • Internal expertise • Review Purchasing Policy • Review Tender Template • Re-develop Specs- biodegradable etc. • Statement- greater recycled content preference • Use eco-product databases • Discussions with like organisations • Attend relevant forums

  25. KEY POINTS • Specs may result in bias against sustainable G&S if overly prescriptive, reliant on track record or focus on up front costs • Writing performance specs less likely to create bias • When preparing spec based on existing template, check for & amend prejudicial provisions. • Add appropriate provisions to specs to enhance SP

  26. TENDER EVALUATION • Sustainable factors must be incorporated in evaluation criteria before the Request for Tender (RFT) is released. Hughes Aircraft Systems International v Airservices Australia [1997] 558 Federal Court of Australia (30 June 1997). • Scoring of tenders against predetermined criteria & application of agreed weightings against scores is generally acceptable (similar to job applications). • All tenderers must be legally compliant.

  27. KEY POINTS • There are legal requirements relating to tender evaluation that impact upon SP. Importantly, environmental issues must be incorporated into evaluation criteria before the call for tenders. • Checklists &/or questionnaires can be used to gather & assess environmental information on suppliers & their G&S. These can be stipulated in the requirements for the tenderer in the specification. • Environmental issues need to be appropriately weighed in the tender evaluation process. V4$ considerations should encompass all the relevant factors rather than simply the cheapest purchase price.

  28. GET WHAT YOU PAID FOR • The extent of monitoring of supplier’s performance is determined by the level of risk with the G&S being provided. • Good monitoring of contractor performance progressively identifies, anticipates & facilitates correction of short comings before the relationship is adversely affected. • The suppliers performance must be assessed objectively using techniques & against criteria which are pre-determined, clearly understood & agreed by both parties. • Techniques- Contract Management Meetings, Contract Reporting, Expediting, Inspection/Visits, SLA Performance Audits & Financial Monitoring & Review/Audit.

  29. KEY POINTS • Standard Contract Management Procedures should be used to ensure compliance with SP components of specs. • Refer Contract Management notes. Developed by DEPT of ENVIRONMENT & CONSERVATION (NSW) & Adapted from MOLINO STEWART PL. presentation.

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