Picture perfect procurement
Procurement excellence for the small screen WRIT TEN BY
JA MES HENDERSON PRODUCED BY
HEYKEL OUNI
w w w. m b c . n e t
MBC’s procurement division is driving real value for the flourishing Middle Eastern broadcaster
A
s the first broadcaster
the last decade. When Lorraine Black joined MBC in 2007 – as the company’s new Head of Procurement, she helped build a team numbering just four which was very transactional in its nature.
to provide a satellitebased free-to-air
Changing perceptions
24-hour television network
“There were no specific pro-
across the Arab world, The Mid-
cesses, it was a basic operation,”
dle East Broadcasting Center
says Black, who led and man-
(MBC) holds a unique place in the
aged the process of CIPS
region’s “Media & Entertainment”
Organisational Certification,
industry. Established in 1991,
which resulted in MBC being the
MBC now offers 16 channels,
first company in Dubai, UAE to
broadcasting a varied line-up of
achieve CIPS certification of
programs and series, including
excellence of its purchasing poli-
flagship shows such as: ‘Arab
cies and procedures in 2008 (a
Idol’, ‘Arabs Got Talent’, ‘theVoice’,
number of MBC’s team are work-
‘theVoice Kids’, and ‘Project Run-
ing on achieving their CIPs
way ME’… among many others.
certifications currently).
MBC is a premium content-
An analysis of the department
centric, audience-focused
was undertaken to understand
company whose success has
the skills of the existing staff and
been underpinned by a procure-
pinpoint gaps that needed to be
ment team that is setting new
filled to create an effective and
standards in the MENA region -
valuable procurement function
thus proving itself to be of real
for the business. An enterprise
added-value to the business, over
resource system (ERP) was
“ The main challenges we faced was shifting the mind-set of our key stakeholders. Now, we work closely with all of our stakeholders, understanding the business and demonstrating where we add value” — Lorraine Black, Head of Procurement, MBC Group
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implemented, processes and procedures introduced, and skills added, gradually building a well-rounded team. As all procurement professionals know, the support of key stakeholders in the business – especially in the C-Suite – is vitally important, and Black says MBC is no different. “The main challenges we faced was shifting the mind-set of our key stakeholders. Now, we work closely with all of our stakeholders, understanding the business and demonstrating where we add value. “We also got support from MBC CEO office which made it a lot easier to drive our ideas forward and get buy-in from the company’s senior management. That’s been really important in working with various departments in a collaborative way, rather than as a standalone function. After we showed that we can add value and leverage our relationships with suppliers, the decision was taken that departments would stop getting quotations without the support and involvement of the
“ Our revenue is largely derived from advertising, and as we have little direct control over regional ad market fluctuations, it is critical to keep our costs under control. That makes Procurement strategic to our long-term profitability and success. Their support has been essential to our migration from in-house systems to outsourced cloud services as part of our digital transformation efforts” — Joe Igoe, Group Director of Operations, MBC Group
procurement team. This has been a real positive shift,” Black concluded. But don’t just take the procurement team’s word for it; Joe Igoe – Group Director of Operations, comments: “Our revenue is largely derived from advertising, and as we have little direct control over regional ad market fluctuaw w w. m b c . n e t
SERVICES
THE TECHNOLOGY DRIVING A PROCUREMENT TRANSFORMATION AT MBC Business Intelligence Reports Business Intelligence reports have been the ERP solution to monitor spend managed through Procurement. The various dashboards are utilised for monitoring the compliance, category and contractual spend, procurement KPIs, procure-to-pay cycle, and supplier delivery performance. This data analysis has been utilised by the procurement team for further discussions on process improvements/potential opportunities for savings and value addition. E-Procurement The procurement team rolled out the E-Tendering system to modernise the procurement strategic sourcing activities. The use of this system has given a 360-degree view of the complete tendering process to all engaged parties. Automating the system which provides quick comparison tools and reduces the scope for human
errors has helped create a more efficient sourcing platform with reduced human effort. Contract Management System Effectively managing and monitoring the financial and operational performance is critical to every organisation. Bearing this underlying factor in mind, the manual contract administrative and management process was assessed and an in-house Contract Management System was customised and developed to meet our requirements. This system has been effective and efficient in: Automating and accelerating the contract administration and management; managing all procurement contracts and related milestones; Strengthening governance/compliance; stakeholder engagement and collaboration; better visibility through reports; and complete transparency of contract process.
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Click to watch: Middle East Broadcasting video: Studio City
tions, it is critical to keep our costs
and drive forward efforts to grow the
under control. That makes Procure-
business sustainably. These included:
ment strategic to our long-term
spend analysis across the group,
profitability and success. Their support
encompassing various categories, sup-
has been essential to our migration
plier segmentation using the Krajlic
from in-house systems to outsourced
Model, assessment of procurement
cloud services as part of our digital
technologies and the alignment of
transformation efforts.�
MBC’s corporate and business strategy with that of the procurement depart-
Driving growth As part of its effort to shift attitudes
ment. On the benefits of the thorough
about the role of procurement, the team
research and planning that has been
at MBC carried out detailed analysis of
undertaken, Black comments: “With the
key strategic activities to understand
development of the procurement techw w w. m b c . n e t
MIDDLE EAST BROADCASTING GROUP (MBC)
“ As a team we were at the centre of a lot of conflict resolution, so we had to be skilled at providing solutions for the site. It took all of our expertise to make the project a cohesive one, pulling everybody together, making sure that all of the elements and all of the pieces of the puzzle actually fell down at the right time, in the right location” — Durdana Farid, Procurement Manager at MBC Group
nologies, we have been able to cater for
notably MBC’s $20mn facility in Dubai’s
the growing needs of business and ena-
Studio City district.
bling the shift from the cost only to the cost-plus-value model.
Completed in May 2017, the state-ofthe-art studios used for programming
“Efficient use of technology through
for MBC’s satellite network, primarily
effective collaboration with stakehold-
MBC1 and MBC3, and online portals,
ers has been leveraged for operational
complement its headquarters in Dubai
excellence and alignment of strategies,
Media City. At least seven shows are
while collaborative negotiation plans
produced at the studios, which the com-
have brought the best of industry knowl-
pany says are key to being able to
edge and commercial leverage on the
attract top talent, the right expertise,
table enabling multitude of benefits in
and bright, creative minds of the various
securing interruptive value propositions.
disciplines that are related to the crea-
“In addition, supplier value management is imperative to the success of
tive and production fields. The nature of TV schedules meant
procurement. So, a 360 degree view of
that the deadline was tight, with a pleth-
supplier positioning and business per-
ora of stakeholders to manage. In the
spective has been used to align our
absence of a contracting consultant,
critical suppliers with business strategy
the procurement team worked to
and growth.”
ensure all the elements that were needed to being the project in on time
Building the future
were in place.
With the company fully bought in to the
“A lot of the detail on a project like this
value offered by a skilled and dynamic
are small, but really important to its suc-
procurement function, the team has
cess,” says Durdana Farid, Procurement
grown, and now numbers 26 profes-
Manager at MBC. “The timeline was
sionals across MBC offices.
very demanding, and to hit our tight
As well as the best-and-braces work
deadline we had to ensure we were
the department oversees, it has proven
accurate with all of the detail, such as
invaluable on some major projects,
ensuring all elements of the project w w w. m b c . n e t
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were compliant to their timelines, from authority approvals to contractors meeting their milestones, to the equipment being delivered on the right time and all the way down to the carpet and furniture for the studios. The deadline – four months, to be exact – meant that the procurement team had to be a highly effective conduit to bring together all stakeholders working on the project. “There was a lot of back and forth; and a lot of input from the procurement department,” Farid continues. “As a team we were at the centre of a lot of conflict resolution, so we had to be skilled at providing solutions for the site. It took all of our expertise to make the project a cohesive one, pulling everybody together, making sure that all of the elements and all of
budget target. We spoke to hun-
the pieces of the puzzle actually fell down at
dreds of parties, leveraging the
the right time, in the right location.”
relationships we have built over
The procurement department’s established
the years, both within the com-
relationships with suppliers that have been
pany and with external partners,
developed and nourished over the years were
and were able to bring them
critical to the project’s overall success.
together to agree on really impor-
“The budgets were very tight, with minimum contingency,” says Farid. “So, despite of the
tant issues for the good of the project.”
fact that we had contracted system integrator and contractors, we went to each manufac-
Procurement never sleeps
turer, we have built relationships with and
The business of round-the-clock
negotiated with them directly, which helped
television means MBC’s procure-
the contractor bring down costs and hit the
ment team is not perhaps typical of w w w. m b c . n e t
“ We’re not working in a manufacturing plant, or for a bank; we’re working in a fast-paced and competitive creative industry. It means we have to be really dynamic, versatile and slick at what we do” — Lorraine Black, Head of Procurement, MBC Group
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have our budgets and ensuring we’re onboarding the correct partners and suppliers, and we also know that we have a duty to make sure the end product is a
1991
Year founded
high-quality one.” Again, says Farid, the work that the procurement team has put in over the years to build relation-
1,800 Approximate number of employees
ships is paying dividends. “We often work in a live environment, so we need people who we can call in to come in and fix an issue at 2am, or ensure a delivery is made in the middle of the night. We need to have that flexibility and
those working in other industries. As Black puts it: “We’re not working in a
that’s when we need something to be free of charge or if some-
manufacturing plant, or for a bank; we’re
thing goes wrong and we need a
working in a fast-paced and competitive crea-
new camera, so it’s important our
tive industry. It means we have to be really
suppliers understand our needs.
dynamic, versatile and slick at what we do.
“We cannot have suppliers that
“Procurement in this region can often be
we don’t have that kind of relation-
very fast, transactional and functional, so it’s
ship with, because the outcome
often about pricing structures and cutting
or the effect that it could have on
costs. But, we work in an environment where
one of our shows on the commer-
the content and quality that we put on-screen
cial impact it could have could
has to be good. The production values on
be huge. So, we ought to be very
shows such as Arab Idol, The Voice and Top
careful when we deal with our
Chef have to be first-class, so on one hand we
suppliers, that we are getting w w w. m b c . n e t
“ MBC procurement team has not only saved us a lot of money in a challenging market, but has helped us get closer to our most important suppliers and partners, at a time of major industry changes” — Sam Barnett, CEO, MBC Group
suppliers who actually understand our business and what our requirements are.”
value,” she says. “Even with the big productions, we need the buyer there so they
The efforts have been recog-
understand any problems and
nised across the company, right
are able to resolve issues. That
to the very top, says MBC’s CEO,
relationship with the supplier on
Sam Barnett, who comments:
the ground is really key.
“Our procurement team has not
“As a department, our people
only saved us a lot of money in a
have to be versatile and have
challenging market, but has
really good communication
helped us get closer to our most
skills. We can teach buying
important suppliers and part-
skills and negotiation, but the
ners, at a time of major industry
ability to adapt to situations and
changes.”
communicate effectively is what we want.
Buying power
It is a strategy that appears to
In a bid to improve the procure-
be paying dividends, says Farid:
ment function yet further, Black
“I deal with a lot of suppliers and
says MBC is changing the behav-
one constant feedback that we
iour of its buyers to ensure they
always receive is that MBC pro-
are recognised as influencers
curement is one of the most
within the business. The days of
engaged procurement depart-
buyers sitting at their desks,
ments in the industry.”
removed from stakeholders, are gone – it’s all about engagement and interaction. “We need our buyers to be on the ground and understand the dynamics of the business if we want to continue to add real w w w. m b c . n e t
Middle East Broadcasting Group (MBC) MBC Building No. 3, Dubai Media City, Dubai 72627 T +971 4 391 9999 | www.mbc.net