Healthcare supplies and medical devices expert Mediq Finland’s challenge was to control the costs of facility services at its operating locations in Finland. An ineffective service process obscured costs and hindered overall control. Expense Reduction Analysts’ experts helped specify a new service process and initiate a competitive tendering process for service providers.
Mediq Finland’s biggest problem in controlling the costs of facility services was an ineffective service structure in which the division of tasks and responsibilities of different service providers was unclear. As a result, costs also lacked transparency and were difficult to evaluate.
“Premises services are clearly a non-strategic aspect of our business. The less time and money we commit to them, the better. To begin with, our costs were simply too high and the additional administrative work devoted to making sense of them took up too much of our time. That’s why we called upon Expense Reduction Analysts to help,” says Mediq Finland’s Chief Financial Officer, Kari Vuorenlehto.
Expense Reduction Analysts’ experts Jyri Haapalahti and Jukka Aromaa analysed the starting-level costs, helped Mediq find the right service model and initiated a competitive tendering process for new service providers.
“They began by collecting data about the starting situation and by carefully analysing all costs, agreements and service instructions associated with facility services. The experts’ study of the starting situation and the smooth launch of competitive tendering were of great value to us,” continues Vuorenlehto.
“Tendering was handled very professionally and in an entirely good spirit: even candidate suppliers who lost in the competitive tendering had a positive view of the process,” explains Vuorenlehto.
The new service agreements specified clearly the work included the basic agreement and the content of services to be ordered separately. Costs were brought under control through a clear service agreement and by transparent invoicing. Moreover, the new service provider’s ability to provide services with its own personnel reduced costs significantly, as the amount of work ordered from third parties declined.
“The project covered an annual cost group item of around 225,000 Euros, which included, for example, cleaning, property management, waste management, security, reception services and hygiene services. In these, we achieved an annual saving of over 23%. Even greater savings were achieved in property maintenance costs,” says Expense Reduction Analysts’ Jyri Haapalahti.
Two-year monitoring period secures savings
“Our savings targets have been exceeded, which has been a very positive surprise, of course. Even so, I consider the greatest benefits of our cooperation to be the improved transparency and the monitoring stage conducted by Expense Reduction’s experts, during which the new operating model will be firmly established,” says Vuorenlehto.
“Operational transparency and monitoring play a key role in ensuring service quality and cost savings. Expense Reduction Analysts’ operating model therefore includes a long monitoring period during which these aspects are closely tracked,” says Haapalahti.
Mediq is an international provider of pharmaceuticals, healthcare supplies, medical devices and associated services. The company operates in 15 countries: the Netherlands, Poland, the USA, Denmark, Germany, Norway, Sweden, Finland, Hungary, Switzerland, Belgium, Estonia, Latvia, Lithuania and France. Founded in 1899, Mediq’s head office is located in the Netherlands and the company has approximately 8,300 employees. Net sales in 2012 totalled 2.6 billion Euros.
"Tendering was handled very professionally and in an entirely good spirit: even candidate suppliers who lost in the competitive tendering had a positive view of the process."
Kari Vuorenlehto, Chief Financial Officer, Mediq
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