Scope
Outsourcing – Managed Service
Industry
Healthcare
introduction
Public Sector Healthcare client benefited from a procurement outsource service to manage £30m third-party buying activity, under pinned with a spend and contract management solution to support visibility, manage risk and optimise costs.
Business Challenge
The client, a leading UK healthcare equipment and services provider, faced mounting pressure to optimise its £30M third-party spend. Following a private equity acquisition, the business identified significant cost-saving opportunities in an under-prioritised indirect supply chain. However, supplier engagement was limited, strategic partnerships were lacking, and commercial rigour was minimal—highlighting the need for external expertise and resource to drive improvement.
To execute upon initial identified opportunities, identify more, and build a solid procurement foundation, 7SS proposed a Managed Service.
Our approach was tailored for an industry subject to strict regulations and rigid contractual terms with clients. The approach was designed to navigate these complexities while upholding best practices in procurement. Critical in Direct Sourcing (Product), where purchasing decisions are clinically driven and managed by commissioners who maintain tight controls over vendor selection.
Define ongoing procurement needs in coordination with Executive team and business leads.
Lead market knowledge and procurement operational and sourcing process excellence.
Competitive quoting: Lead tender / negotiation activity for the business where required.
Contracting & risk mitigation: Develop good practice contracts that protect the client interests and are in line with best practices to mitigate risk (e.g., GDPR, regulatory, cyber, etc.)
Weekly reporting on project and implementation status (e.g. cost savings projects, RFPs, contracts)
Our solution
7SS took a structured, data-led approach to define the as-is state and identify improvement opportunities. Spend, contracts, and policies were analysed to establish a clear baseline, then validated through interviews with key buyers to understand real-world processes and capability. The findings were benchmarked against best practice to develop sourcing strategies by category, and a delivery roadmap was created to prioritise actions by ease and benefit — forming the foundation for implementation.
To execute upon initial identified opportunities, identify more, and build a solid procurement foundation, 7SS proposed a Managed Service.
Our approach was tailored for an industry subject to strict regulations and rigid contractual terms with clients. The approach was designed to navigate these complexities while upholding best practices in procurement. Critical in Direct Sourcing (Product), where purchasing decisions are clinically driven and managed by commissioners who maintain tight controls over vendor selection.
Define ongoing procurement needs in coordination with Executive team and business leads.
Lead market knowledge and procurement operational and sourcing process excellence.
Competitive quoting: Lead tender / negotiation activity for the business where required.
Contracting & risk mitigation: Develop good practice contracts that protect the client interests and are in line with best practices to mitigate risk (e.g., GDPR, regulatory, cyber, etc.)
Weekly reporting on project and implementation status (e.g. cost savings projects, RFPs, contracts)
Outcomes
7SS initially focused on identifying and delivering cost-out initiatives, which evolved into a two-year Procurement Managed Service. This partnership embedded best-practice procurement, improved contractual structures, and achieved £1.5M in direct savings and £900K in cost mitigation. With an ROI of over 5:1, the engagement strengthened supplier relationships, integrated procurement into business decisions, and laid a solid foundation for future in-house capability.
7SS were engaged to initially identify and deliver cost-out initiatives. Due to its success, this engagement transformed into a larger two-year Procurement Managed Service overseeing all Indirect spend.
Established a foundation of procurement best practices that the organisation can build upon once in-house.
Implemented improved contractual structures for negotiated agreements.
Achieved direct P&L savings of £1.5m over a 15-month period.
Realised an additional £900k in non-P&L benefits, primarily through cost mitigation.
ROI of over 5:1 achieved against 7SS fees.
Fostered a culture where procurement is integrated into decision-making processes.
Strengthened engagement with key providers by fostering partnerships and moving away from previous transactional, operations-focused interactions.