Annual report 2012

Procurement function, logistics and environmental responsibility

Procurement function

One of the most important strategic innovations is the centralisation of procurement processes at the Company for the majority of goods and services. Information support in the form SAP ERP was introduced for the procurement function in April. We worked intensively in the business process re-engineering project and successfully carried out tasks to rationalise costs. We thus achieved positive financial effects in the form of savings. We strengthened cooperation with subsidiaries in the Group, which will form the basis for transferring best practices and achieving positive synergy effects in procurement.


Logistics

In accordance with the strategic objective to centralise the logistics activity, we drafted the relevant plan with the aim of increasing labour productivity and optimising work processes. Following the review of activities, we have already terminated the warehousing activity at three locations. We will continue in this direction until all receipt and distribution locations have been shut down by 2014. We made changes to work processes that led directly to an improvement in productivity.

Significant projects and additional activities included:

  • the establishment of a logistics process in the scope of the City of Ljubljana WiFi project, on the basis of which the construction of wireless internet access points is already under way; and
  • active inclusion of the range of logistics processes in the activities of other organisational units in the scope of the work force management (WFM) project to allocate technicians, which is based on preparation, supply and delivery to close to 100 locations for around 400 technicians, and the establishment of a reverse logistics process.


Reduction in the Group’s impacts on the environment through efficient procurement and logistics

Special attention is given to reducing the Group’s impacts on the environment when carrying out the procurement and logistics functions. When entering into contractual relations with Group companies, all suppliers must commit to compliance with valid legal requirements and best practices relating to energy and environmental management and related areas, in particular with provisions that govern health and safety at work, the handling of chemicals and other hazardous materials, the transport of dangerous goods, fire safety and energy efficiency. Suppliers must respect all of the Group’s requirements regarding its environmental and energy policies, its waste management plan and instructions regarding separate waste collection by location, and must maintain contact with the Group’s employees responsible for energy and environmental management by location.

The Group introduced recyclable packaging, which resulted in the reduction of waste cardboard by seven tonnes on an annual basis. In addition to the environmental impact, the latter also resulted in a reduction in packaging procurement costs. Together with the company ZEOS, we participated in a general education campaign regarding the importance of separating and recycling electronic waste such as batteries and mobile phones.