‘AFFORDABILITY, AVAILABILITY AND CAPABILITY’:
TRANSFORMING PROCUREMENT AND SUPPLY CHAIN AT BABCOCK
INTERNATIONAL GROUP
‘AFFORDABILITY,
TRANSFORMING PROCUREMENT AND SUPPLY CHAIN AT BABCOCK
INTERNATIONAL GROUP
Nick Checketts, Group Director of Direct Spend at Babcock International Group, on the company’s thorough approach to supply chain and procurement in a dynamic and intricate industry.
he company specialises in marine, land, aviation and nuclear verticals, and is consistently developing within these areas to bring forth new innovations in the defence sector.
Today we welcome Nick Checketts, Group Director of Direct Spend at Babcock, to discuss how the company has built a supply chain strategy that centres on strategic relationships and anticipates risk.
Launching our conversation, Nick explains how the company’s procurement and supply chain approach has transformed in recent years.
“I sit on our procurement and supply chain leadership team,” says Nick. “We went through a transformation within this function around three years ago, as part of a global transformation programme. We’re
still running that programme now, but one of the first things we did was identify a number of functions – one of which being procurement and supply chain – that we were going to focus on turning into a centrally led function.
“This move to being centrally led means that we’re able to standardise processes while retaining an embedded and organised procurement supply chain within the business that can effectively deliver against the differentiated needs. We’re working on getting more alignment on how we do that, driving the efficiency and effectiveness of the function as a result.
“Every sector of the company is chasing new growth opportunities and looking at future capabilities
of the business. When you’ve got a category management organisation, you have a strong alignment with that growth, because you have to be looking at the longterm prospects of any business decision.”
This is particularly resonant in the defence and aerospace industry,
where project lead times are measured in years, rather than weeks or months. For Nick, that means that an attentive approach to procurement is imperative.
“You need your procurement strategies to align to a years-long timeline,” explains Nick. “This means not only looking ahead to future
development capabilities, but also the risks that could potentially play a role. Supply chain strategy needs to be factored into the future of an organisation because it can play a huge role in the business’s future success.”
So, how does Babcock build such long-term supply chain strategies? For Nick, it’s all about taking a holistic approach.
“We’re taking a holistic view of the function to gain a better understanding of what we’re doing well, and what we need to improve on,” says Nick. “We need to know what our development opportunities
are, how we can become more effective and how we can differentiate ourselves within the market.
“For example, we’ve been looking at how we approach risk management. Before, we were looking at what was happening around us, trying to understand the risks and deal with them as they arise. We’re now trying to be far more anticipatory so we can proactively build up an awareness of the risks which are out there, what might be coming and how we can deal with these developments in the future.”
But developing that awareness can be challenging in a sprawling, global industry such as the defence sector.
“As a business, our warehousing logistics strategy needs to span lots of different things on lots of different sites,” says Nick. “We’re trying to look at our demand planning on a holistic basis to see what areas we need to invest in, and we’re evaluating the tools and the technology around us to see what can help us reach our goals.
“There’s a lot of technological developments in the procurement and supply chain area at the moment, and everyone’s focused on the quickly emerging, trending tools. While we do see the value in investing in new technologies –particularly automation – we need to
make sure we’re effectively utilising our existing tech stack.
“If we’re not getting value from the tech in place, that’s when we make the decision to invest in or develop new technologies in the area and remove anything that’s not making sense. We’re taking a pragmatic view – we have to be realistic about what we’re implementing, because there’s no point in spending money on technology that doesn’t fit within our strategy.
“We’ve done a lot of work reshaping our functional strategy, and our model for this has been focused on helping our engagement with the business
KAEFER has long been a leader in industrial services, offering crucial support to the energy, industrial, nuclear and defence sectors worldwide. KAEFER works on more than 5,500 job sites internationally, with around 32,000 employees.
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We add value to our client’s projects through LEAN management, digitalisation, and our innovative teams.
Implemented throughout the whole KAEFER Group, LEAN Management leverages synergies and simplifies working processes for employees by creating a common understanding and mindset. LEAN plays a vital role in strengthening the culture of operational excellence through establishing routines for continuous improvement.
LEAN principles are implemented at every stage of a project to ensure thorough planning, efficient execution and post-completion analysis.
LEAN is working, not just for our clients, but for us as well. For 15 years, KAEFER UK & Ireland has been a trusted provider of industrial services at the Devonport Royal Dockyard in Plymouth, working closely with Babcock International. The team’s commitment to customer service, value and delivery has meant they have been awarded the Gold Performance Award as part of the 21st Century Supply Chain’s (SC21) Operational Excellence Programme.
We understand that efficient processes are the foundation of successful projects.
“KAEFER operates at our best when we can collaborate in partnership with our customers. Our biggest strength is our people, who are dedicated to delivering the highest service levels in our industry. For example, with Babcock International, we have a long-term relationship and have built a high level of trust to deliver the services they need every day. This can be reactive to support the changing demands of the dockyards and Ministry of Defence. But more importantly, we spend significant time together, planning ahead and building collaborative strategies that not only meet resource demands and project milestones, but also focus on continuous improvement and innovation programs that drive operational delivery and increase value.” – Chris Foulkes, CEO, KAEFER UK & Ireland
We have ambitious plans for growth at KAEFER which will further strengthen our position as a market leader in delivery of industrial services. It is likely that instability in global economics and politics will continue for some time, which means it vitally important that we play to our strengths, keep developing our people, while remaining innovative and agile. We are committed to working ever more closely with our customers and strategic partners such as Babcock to improve our services levels, helping build a safe and secure future.
population. There’s a lot more we can do, so we need to continue on that path of enhancing the communication to the rest of the business in order to signal what’s out there.”
A key aspect of this reshaped strategy has involved placing partnerships at the centre of the supply chain and procurement function. Here, Nick highlights some of the indispensable relationships that Babcock has built – both established and new.
“At the centre of the wheelhouse of supply chain procurement is partnerships,” says Nick. “Our partnerships with our key suppliers are absolutely vital to what we do as a business. For instance, KAEFER is embedded within our sites, helping us undertake crucial industrial services. On any given day, we have several hundred people from KAEFER on our sites conducting specialised activities that are pivotal to our operations.
“These are the types of partnerships that we prioritise – it’s instrumental that they’re involved upfront in the demand planning side of things to understand the cycles of the business and what the customer needs and will need. If we’re collaborative on this side of things, our partners can plan their workforce strategy to ensure that they’re prepared for quick changes in the industry.
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“AT THE CENTRE OF THE WHEELHOUSE OF SUPPLY CHAIN PROCUREMENT IS PARTNERSHIPS. OUR PARTNERSHIPS WITH OUR KEY SUPPLIERS ARE ABSOLUTELY VITAL TO WHAT WE DO AS A BUSINESS”
Nick Checketts, Group Director of Direct Spend
“Let’s take ARCO as an example. ARCO is a UK provider of personal protective equipment (PPE). With thousands of people on our sites, our primary responsibility is to keep them safe and PPE is the first defence that we have in this regard. It’s absolutely critical that our PPE supplier is aligned with us and understands the requirements of the business, because having the right levels of equipment ensures that our employees are able to work safer and more efficiently.”
Babcock has also made sure to prioritise new and emerging relationships with suppliers.
“Shield Services is one of our newer relationships,” says Nick. “They came on board providing deck insulation services for our Type 31 programme. As an important supplier to that programme, it’s key to foster the right relationship with them to make sure that the technical requirements are understood and consumer demand is understood, so that when they come on-site they can be in sync with the programme and everything can progress as smoothly as possible.
“R&M Electrical is a different kind of relationship for us. They’re a smaller business, but one that has grown rapidly with us to provide largely electrical consumables.
We really grabbed hold of that relationship to mutually explore growth opportunities. They’ve been in conversation with us about where our demands are, and recently opened a facility in Plymouth to support the Devonport Dockyard. For us, it’s very important to who we are as a company to continue to work with small British businesses.”
But while Nick credits partner collaboration as a key aspect of Babcock’s continued success, he also highlights how the relationships the company has formed with its customers are equally important for its growth.
“The collaboration we foster directly with the customers has been very exciting for us as a business,” says Nick. “We’ve had growing relationships with our counterparts in procurement and supply chain functions. Our customers want to actively work with us to build a strategic procurement ecosystem that considers how we can make things more efficient and effective in such a highly restricted industry. When you get big players together and you start collaborating, you can uncover real areas of transformation.”
However, working in such a complex and highly regulated industry requires a thorough understanding of risk in order to foster this level of transformation.
“We take a very proactive view of risk in our supply chain,” says Nick. “We’ve invested in tools that can anticipate risk, giving us as early a warning as possible, through our first tier mapping into tiers two, three and four of our supply chain.
“We’re now starting to generate how the relationship lies between the tiers in the supply chain, on both a geographical and transactional basis. If a global event happens, we can immediately get an impact analysis to see the role it will play across our supply chain and map out a solution alongside our suppliers.”
But at Babcock, being futurefocused is about more than just risk aversion. Babcock has prioritised developing a comprehensive approach to sustainability within the supply chain, with a specific focus on fostering local relationships and giving back to the community.
“We look at sustainability through a viewpoint of environmental, social and governance (ESG),” says Nick. “There’s growing regulatory requirements around environmental considerations that we’re actively taking steps to map and understand how we can then affect, impact and drive those down.
“In terms of social sustainability, we recently joined an entity called
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“We also encourage a lot of work in the community. Babcock offers an extra day of annual leave for employees to undertake charity or volunteering activities. Last year, my team did some maintenance work on an inshore lifeboat station in Gloucestershire. It was a great team-building activity with a strong purpose at the centre of it.”
Babcock is also working on reducing its carbon consumption, Nick reveals.
“My team led the Devonport site project to switch over from white diesel usage to Hydrogenated Vegetable Oil (HVO) fuel,” says Nick. “Due to the nature of the site, we rely on many mobile power units, which have typically been diesel generators.
“Last year, we were able to switch over to far more sustainable fuel, meaning that we’re nowhere near as big a consumer of carbon as we used to be. We’re now rolling that out across our sites in the UK, and
we’re very excited about the future sustainable impact this will have.
“I think things like this are great, because in traditional procurement the priority was making things as cheap as possible. This is about delivering the right outcome for the business.”
And that dedication to the business is paying off, with Nick predicting a period of fast growth for Babcock.
“I believe that in our next few years, we’re going to see significant growth and development within the company,” says Nick. “There has been a period of transformation over the last few years, and since then the
company has been growing strongly in terms of capability, performance and relationships.
“The work we do focuses on the long term, so we’re constantly developing to ensure that we’ve got a robust supply chain network in place. We’re well-positioned to grow globally as we transition into a balance of support services, engineering and product development. We’re designing and delivering new products in partnership with big original equipment manufacturers (OEMs) or in our own right as an advanced manufacturer. It’s a very exciting time of development for Babcock.”
Learn more about Babcock here.
“I love listening to podcasts, because I think they’re a valuable tool to keep yourself abreast of the latest thinking,” says Nick.
“I’ve been listening to the Art of Procurement podcast a lot recently, which I think is really useful for understanding the ways different leaders are approaching procurement in their industry.
“More personally, I’ve always had an interest in politics and world events, and I love to listen to podcasts focused on this global angle. It also helps me within my role, because when you’re projecting forward you must have your finger on the pulse of world events. Listening to podcasts that take a deep dive into major global shifts and trends helps me challenge my team and see how we would react to new trends and potential risks. If we’re not preparing for how the world may be changing, then we’re not doing our jobs.”
Nick is excited for the upcoming Defence Procurement Research Technology (DPRT) Expo in March 2025.
“This is a significant event for us, as well as our suppliers,” says Nick. “It’s a great environment for the industry to gather and share ideas, explore best practices and gain a stronger understanding of what’s going on. We’re also lucky to have speaking slots there as well.
“We’re also looking ahead to DSEI next summer, which is a massive event for us as well as our significant suppliers. It’s an incredible event for connecting defence leaders on a global scale, and it takes place every other year in London. We have a huge stand there, and a big presence. It’s a big priority for us.”
Connect with Nick
Babcock International Group
babcockinternational.com