Success Story

We continue to talk about the achievements of graduates of training programs for customers of the Center for Excellence in Procurement of the Kyiv School of Economics. Read the success story of KSE graduate Yana Vorobei, specialist-analyst for research of the commodity market of the 1st category of the Department for Support of Competitive Bidding of the SS "Rivne NPP" SE "NNEGC "Energoatom", in an interview prepared as part of a joint special project of SmartTender and KSE.

How long have you been working in procurement and why did you decide to choose this particular specialty?

I have been working in procurement since 2016. Having got a job as a legal adviser of a separate division "Warehouse management" of SE "NNEGC "Energoatom", in parallel with my official duties, I worked as secretary of the tender committee. By the way, it was the experience of the secretary of the tender committee that allowed me to win a grant for free studying at KSE.

Purchasing has entered my life by itself, and for good reason, because I like this field of activity. Something new always appears in the procurement sphere: as soon as you think that everything is in order, changes are made to the procurement legislation, and they need to be re-mastered and implemented. I realized that I want to develop in this direction, so I changed the position of a lawyer to the position of a buyer. Now I work as a specialist-analyst in the study of the commodity market of the I category of Competitive Bidding Support Department and plan to become an authorized person.

How do you apply the knowledge gained from studying at KSE in practice?

First of all, I used the knowledge gained on the KSE course in my project “Category strategy in the purchase of building lime” (this category of goods is critically important and priority for SS "Rivne NPP" SE "NNEGC "Energoatom" – from 1,000 to 1,500 purchases are carried out annually).

The training methods "ABC analysis" and "Cost cube" helped me to determine the category profile. These methods are effective. So, for example, "ABC analysis" allows you to classify the business resources of a legal entity depending on their importance, where "A" – the most important, and "C" – have the least value. The classification is based on the Pareto principle, which to ABC analysis sounds like "reliable control of 20% of positions allows 80% control of the system". In business, the ABC analysis principle and the Pareto principle are most often used in logistics to manage inventory: about stocks of raw materials, components, suppliers, customers, etc.

“Spend cube” analysis is a set of tools that uses modern data analysis software to monitor and improve strategic sourcing, procurement efficiency, and value creation in the supply chain while maintaining greater profitability and competitive advantages for the company as a whole. Both of these methods should be applied to any business that plans to grow.

As a result of the project, we attracted new suppliers, improved the approach to the procurement of building lime, and are continuing to reduce our costs. And most importantly, we managed to fulfill one of the recommendations of the project – “Purchase of this product under a framework agreement”. On April 1, 2021, the company entered into its first framework agreement for the purchase of construction lime. We have already organized two selections among the participants in the framework agreement and concluded the first contract for Stage 2 (you can familiarize yourself with the purchase here).

I am still reviewing the lectures of the course “Procurement Manager”, and recently, inspired by them, I developed a theoretical project “Place of the procurement function in the SS Rivne NPP” for colleagues. This project is important for raising awareness of the procurement function, its value, objectives, and constraints, especially in the realities of the transition from tender committees to authorized persons.

How did the company's procurement processes take place before, and what has changed with the introduction of a categorical strategy?

Our company performs over a thousand procedures annually. For example, in the first quarter of 2021, 387 purchases were carried out (of which 100 open tenders, 176 open tenders with publication in English, 18 negotiation procedures, 62 simplified purchases, and 29 purchases without using the electronic system), 225 contracts were concluded, and the amount saved on 296 procurement procedures amounted to about UAH 12.7 million. We have a well-functioning mechanism for purchasing certain groups of goods, works, and services.

Success Story

Of course, we plan to improve and adapt the new analytical methods and procurement tools that are taught at KSE, however during a pandemic it is difficult to implement and apply without prior theoretical training with internal “categorizers”.

What exactly is “categorical strategy” in your company, and what results does it bring?

Now for our separate subdivision "Rivne Nuclear Power Plant" it is strategically important to ensure stable and sustainable development. However, the categorical strategy in a state-owned company cannot be the same as in commercial enterprises, since we are noticeably limited in our choice.

When purchasing the goods, works, or services we need, we must act within the framework of the legislation, for example, the Law of Ukraine "On Public Procurement". And this does not always successfully and effectively satisfy our need due to the periodic dishonesty of the participants.

It is also worth noting that there are a significant number of participants who do not want to participate in our purchases due to the long payment period, which is a necessary condition for us since we are a state-owned enterprise. We would have even more significant indicators of competitiveness and economy if we could work in the realities of the market business. We understand all the shortcomings and obstacles in our work, which, in turn, does not allow us to fully implement the processes of strategic procurement, namely the "Seven Steps in Procurement", which Volodymyr Stetsyk talked about in his lectures during the course:

- the attraction of “key” participants;
- forming a category profile;
- listening to business needs;
- market analysis;
- defining a strategy;
- implementation of the strategy (using “64 procurement methods”);
- and most importantly, securing future results.

What are your TOP-5 personal tips for the effective work of the buyer?

I would like to advise each buyer of the following:

1. Never stop learning. Improve yourself by translating theory into practice. Increase your value.
2. Feel free to ask about things that you don't understand or know. We are only human, we make mistakes and learn from our own and, if we are lucky, someone else's experience.
3. Think on paper. Always write down your ideas, think through the risks and steps to achieve the goal.
4. Learn foreign languages and travel. This will allow you to look at the world "with different eyes" and think critically, comparing different facts and circumstances, and be free from stereotypes.
5. Be open to communication. Share your experience and you will always be remembered.

Read the previous Success Story within the joint special project SmartTender and KSE here.

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