BAM's procurement policy aims at both securing economies of scale across the entire BAM organisation and benefiting from BAM's decentralised organisational structure.
Benefits of scales of economy
Due to the nature of the sector in which BAM is active, primary processes focus on obtaining and completing projects in as efficient and effective a manner as possible. Accordingly, procurement activities should share this focus. As many projects pursued within and outside a specific region or by an operating company, respectively, have shared procurement segments and processes, combining them can generate substantial and structural procurement economies of scale. Within BAM's decentralised organisational structure, the procurement column is organised in accordance with the coordination principle.
It is BAM's ambition to work on lasting relationships with a selected number of construction partners, in which entrepreneurship and specific knowledge in the field of product, market and process are leading. The making and implementing of the right choices in this are the success factors of the BAM procurement policy.
Another challenge is how BAM can benefit more from the expertise and talents available in its supplier network. When does a procurement process/supplier become early involved in a project? A differentiated approach should be taken in analysing the supplier network's potential contribution during the preparation/tendering and specification phase. The terms preferred supplier and preferred customer are key in this. A logical consequence will be the potential development of long-term relationships with unequivocal objectives.
More emphasis will be placed on who is involved and who does what in BAM processes. The expertise and talents of our construction partners can be mobilised in an optimal manner to improve BAM's operations. This facilitates a structural approach to increasing the size of the total available 'project margin pie', rather than simply and solely 'fighting' for the largest part of existing margins.
Supply chain and sustainability
In order to implement sustainability in the relationship with our supply chain partners, we have executed the following actions:
- Several suppliers that deliver products and services that have a high impact on our sustainability targets as set, report quarterly on, for instance, the CO2 emissions that have been caused in delivering services and/or products to BAM. Their data is critically analyzed and furthermore a number of audits on this data by BAM employees have been executed.
- Our most important suppliers are contracted under our GPSC version 7 or higher and therefore adhere to our Business Principles, which includes actions concerning sustainability.