Nyenrode & RTL Masterclass: Strategic Energy Procurement 

Strategic energy procurement is currently high on the agenda of major business consumers. In response to this, Nyenrode and RTL, in partnership with the energy company NUON, organized a masterclass on strategic energy procurement on 27 May 2009.

  Speakers at the masterclass included Prof. Jacques Reijniers MBA,
  professor in Procurement Management at Nyenrode and chairman
  of the board of Het NIC B.V.; Pieter Verberne, General Manager
  for Energy of AkzoNobel Industrial Chemicals; and trend-watcher
  and futurologist Rob Creemers. The masterclass, which was
  chaired by RTL Z newsreader Roland Koopman, was followed by
  a discussion between the audience and a panel of experts
  and representatives of heavy energy users, including Alexandra
  Schless, Managing Director of the TelecityGroup.

Pieter Verberne, AkzoNobel 

Hot Topic
Energy procurement is currently a hot topic. According to Prof. Jacques Reijniers, this is mainly
due to the often high, fluctuating and unpredictable prices of fuels. However, the debate on
sustainability has also led to an increased focus on energy procurement. Additionally,
procurement. Additionally, the cost of energy impacts the cost of products and businesses
have to think creatively about making savings in response to the recession (this impact is larger
 than the price on the invoice).      
 
Energy and Competitiveness 
In his presentation during the masterclass, Reijniers stated that the competitiveness of businesses could                         Prof. Jacques Reijniers
beincreased considerably by approaching energy procurement on a more professional basis. However, this does
require vision, willpower, creativity, knowledge and experience. Reijniers: “In the discussion at the end of the masterclass and in the questions that were posed during the meeting, it struck me that many companies are still wrestling with the question of what energy really means for their own business. Energy can have a big effect on the cost price of products and the company’s profitability. It is a variable that ultimately plays a role in determining whether your company makes a profit or a loss.”

NUON/Nyenrode Survey
Unfortunately, in the Netherlands businesses are still approaching strategic
thinking about energy procurement in a fragmented way, as was shown
by a recent survey conducted by NUON in partnership with Nyenrode.
Reijniers mentions some results of that survey: “Many businesses
lack professional insight into the costs of energy. Also, many buyers have
no knowledge of the form and term of the contract that has been agreed
with the energy supplier. Few of them have a good overview of energy
suppliers and the deals that they can offer. Also, the responsibility for energy
procurement in businesses is often organized on an ad hoc basis; 
little time is invested in the matter and little knowledge is available.”

In general, people still think about energy procurement along very traditional lines,
says Reijniers: “Although businesses try to develop new policies, they approach this
with a working method, an organization and a manner of thinking that stem from the
past – a past when energy was only one product and was supplied by only one company.”

Professionalism in Procurement
Reijniers: “Big companies such as AkzoNobel, Shell, KLM and DSM understand very well how to approach the energy issue. They understand the relationship between product and price,the correlation with business, and know what procurement is. However, in the Netherlands there are not many medium-size businesses that have this. They do not have sufficient of what I call ‘procurement professionalism’. Procurement professionalism means more than simply buying and negotiating about the price. It means thinking about the various policy parts that a company must fulfill when purchasing. Energy procurement brings together a variety of disciplines (such as technology, finance, legal and management). The buyer doesn’t always have to have all this knowledge in person; to an extent, the roles can also be partly outsourced in a well considered way. He or she can then opt to play a conductor’s role. The product (and the energy that goes into it), the contract form and contract management, the suppliers’ market, the procurement process, the tendering process, the alternative (innovaltive) energry sources, the process of logistics and the corporate strategy all have to be viewed in a coordinated fashion. If a company wants to get added value out of energy procurement, it will have to act as an enterprising purchaser, a purchaser who innovates and know how to make use of market opportunities. A real challenge!”

More information about the Nyenrode
& RTL Z Masterclasses:
www.rtlmasterclasses.nl