Flow Chart For Optimal Utilization Of Market Intelligence To Address Sourcing Challenges
Flow Chart For Optimal Utilization Of Market Intelligence which will describe how MFB can get favorable outcome by using market intelligence to address sourcing challenges.
Scoping of Optimal Utilization Of Market Intelligence :
Defining project scope, geographies and functions:
Project scope is described as the project planning which includes determining and documenting a complete list of the project goals, features, functions, deliverable, tasks, completion date and ultimately cost (Gotto, 2013). One of the multinational F & B manufacturing companies located in Australia scheduled to renew its contract for natural gas which is the primary sources of energy to give power to its processing units (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence) .
Define current scenario and problem statement:
Currently, in Australia there is not sufficient feedback from suppliers about change in natural gas prices. This is all due to frequently changes in local body rules and regulations along with taxation norms. This situation creates a limit for the clients’ manufacturing company to predict the optimal future prices to renew its contract of natural gas in a favorable price (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
Establish Team Charter:
A team charter is a document which is developed in a group to clarify team’s directions and establishing boundaries. To develop a charter will reduce the confusion and risk of rework to attain the group objective. Below points leads to develop a team charter.
It will describe the value of gathering people together, to find out the problem along with its acceptable solution. For example, in current scenario GEP developed a team to find out the outsourcing prices based on market intelligence for MFB to make contract for its supplies (N/A).
Duration and time Commitment:
The amount and time required for a group together to accomplish project scope. I.e. the time consumed on research to find a suitable contractor for energy supply to GEP Client (N/A).
Multinational F & B required a natural gas supplier in a cost efficient manner (N/A).
The group of people from GEP who identifies the suitable supplier of NG for his client’s Company.
Desired end Results:
Client’s company wants to find out a natural gas supplies in cost effective ways to renew its contract. Which enables them to power their ovens in highly uncertain market environment (N/A).
The GEP team identifies a suitable supplier in most uncertain LNG market. It based on total consumption and contacting with the regulatory bodies. GEP suggests a supplier to its client with 10% less in price for a contract of one more year.
Internal analysis of Optimal Utilization Of Market Intelligence :
Internal analysis is done internally in an organization by identifying its strengths and weakness. In the case of MFB industries they need supply of natural gas to run their process of manufacturing. For this purpose they have outsource energy supplies through different natural gas suppliers (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
To out-source a supplier the client company must have to analyze the past prices of natural gas in the market of Australia to make new contract in a cost effective way. But unfortunately uncertain changes in regulatory laws supplier become unable to determine its impact on current prices. In this situation, an incumbent company GEP provides consultancy and find a suitable supplier according to their demand. GEP provides analytics about future prices along with the impact of regulatory changes on the supply of natural gas (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
External analysis of Optimal Utilization Of Market Intelligence :
The supply and demand are the key factors which drives the commodity prices globally. Instead of these factors, too many others factors exist which affects the pricing of a commodity in each region. There were too many suppliers were available but the client company don’t have market insight to chose a best supplier. For this purpose, it takes help from a GEP consultancy firm. It helps its clients to find about a suitable supplier for long run. GEP’s has expertise in identifying the international market trends and it impact according to different regions to provide best consultancy to its client (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
Strategy development of Optimal Utilization Of Market Intelligence :
For this purpose GEP’s Expertise make in depth and targeted research on natural gas market. This research was based on the discussion with the local regulatory bodies. The purpose of this research is to gather intelligence on supply markets and factors on which they can make negotiations. Supplier market intelligence provides a transparent trend of natural gas pricing in the Australian market. It also includes the factors which impact on price forecasting due to the local and global developments. On the other hand, negotiation points help them to minimize the impact of uncertainty on natural gas pricing.
Strategy development explanation:
Additionally GEP also reviewed the pipeline tariff along with the three contractor’s status with the Australian natural gas producers. This research provides guidance to understand the impact of source and transmission pipeline on the pricing strategy. It also focus on too many other factors which can influence the natural gas price as well. There are different factors which influence on sourcing. It can be pricing pressure or competitive pricing, supplier identification or validation, dual sourcing, risk management and low cost regions. The GEP’s team also identifies that increase in use of shale gas and the increase in LNG export has significant impact on the natural gas prices in Australia (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
Sourcing execution and Implementation of Optimal Utilization Of Market Intelligence :
To find out the best supplier it’s necessary to have knowledge about all suppliers along with quotes. The supplier companies are, AGL, Dodo power & gas, Energy Australia, Lumo Energy, Origin Energy, Red Energy, Simply Energy, Momentum Energy, Click energy, Alinta Energy. On the bases of market intelligence and in depth insights from category experts GEP’s not only identify the best NG supplier for the client. It also give him consultancy to enter into a contract along with the idea contract time period based on the current market situations. Based on the downward price pressure the client was recommended to enter into short term contract, due to which client signed a year-long contract along with 10 % saving in Price (Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence).
Gotto, J. (2013, August 28). How to Define the Scope of the Project. Retrieved from Totally Communications: http://www.totallycommunications.com
Multinational F&B Company Saves Millions in Energy Sourcing through GEP’s Market Intelligence.
N/A. (n.d.). Team Charters. Retrieved from LCE-Life Cycle engeering: https://www.lce.com/