The Devastating Effect of Unsustainable Palm Oil

Palm oil is one of the most widely used products in the world, but its increasing demand has led to large-scale, unsustainable plantations, causing devastation to large parts of growing countries. Indonesia is one such place.

Deforestation

Earlier this year, Jordan Early wrote an article for Procurious in which he asked whether or not it would be possible to get to the stage where all palm oil would be produced sustainably.

Jordan cited the example of PepsiCo, one of the high-profile organisations using palm oil in a number of its products, and Sum of Us, who were highlighting the potential unsustainability in the PepsiCo supply chain. PepsiCo have since stated that they are working towards sustainability, but other large organisations are lagging behind.

This got me thinking, not about criticism or finger pointing, but education on this subject for procurement professionals. So that’s what I’ve decided to do here.

The Product

Palm oil comes from the oil palm tree, a crop that is grown exclusively in the Tropics. What makes it a popular crop to grow is the high yields it produces in comparison to other vegetable oils and the lower cost to growers.

While the oil’s most common use is as a cooking oil in developing countries, it is also used in a number of household products – from lipstick and soap to detergents and even ice cream. Increasing demand has led to increasing global production, with plantations spreading across Asia, Africa and Latin America.

Replanting with oil palm trees is a good option for many farmers and landowners, not only because of the higher yields, but also due to incentives offered for producing the crop for export. The Indonesian Government has been reported in the past as offering tax incentives and interest rate subsidies.

Effects of Unsustainable Growth

However, this growth has also led to unethical practices, creation of an unhealthy monoculture in some countries and widespread deforestation, leading to loss of habitat for a number of endangered animals, as well as land and livelihoods for indigenous and local populations.

It has been reported recently in Indonesia that thousands of hectares of peatland are under threat, due to companies clearing the land for oil palm plantations. The deforestation has polluted local water supplies and the situation is likely to worsen when the companies burn the ground to reduce the soil acidity before planting the oil palms.

In addition, local villages that have relied on the peatland for a source of water in dry seasons and a livelihood are struggling and face the prospect of being moved on from their home.

Part of the issue comes from a lack of strong regulation when it comes to licenses and permits for plantations. It’s felt by many in Indonesia that new regulations need to be issued by President Joko Widodo, as current ones offer no legal consequences for contravention.

Changes to be made

In spite of all this, it’s hard to argue against the idea that palm oil has had a positive effect on the economies of countries it is grown in, particularly when planting has been conducted in a sustainable fashion.

In 2008, as the demand for palm oil increased steadily, Indonesia exported $14.5bn worth of palm oil products. The country has also seen more than $20bn worth of investment from banks and financial institutions since 2008.

And there appears to be a change happening at an organisational level too, with Wilmar International, the world’s largest trader of palm oil, announced a ‘No Deforestation, No Peat land, No Exploitation policy’ – a move that many hope will encourage other traders and refiners to follow suit.

The Role of Procurement

As with many aspects of sustainability and ethics, the role of procurement is to ensure that supply chain practices are conducted at the required high standard. For palm oil production, it is about ensuring that strong practice around sustainability, including deforestation and ethical issues such as the treatment of local populations, are fully enforced with all suppliers.

It is a matter of both organisational and personal responsibility to ensure the practices and behaviours are correct. Consider taking the CIPS Ethics Test on an individual basis and opening dialogue with your suppliers to ensure that they understand what your organisation expects.

There may also be events in your region you can attend, similar to this one at the Melbourne Law School, which look to generate discussion on topics like regulation of the palm oil industry and what can be done to help countries like Indonesia.

If you are interested (and a procurement professional in Asia), you can contribute to a new book that is due to be published next year. Sustainability in the Asia Pacific’ intends to open the discussion of ‘pragmatic perspectives’ in sustainability accounting to support corporate decision makers in improving corporate sustainability management practices. Check out the website to see how to contribute.

Do you source products containing palm oil? Have you seen any good you can share? Or bad practice and how you dealt with it? We’d love to hear from you and get a dialogue going in this area.

I’d like to thank Dominic Gray for helping me with my understanding of this topic and providing sources of information.

5 Things Procurement Organisations Should Start Doing Now

By Kay Ree Lee, The Hackett Group 

Stop paying lip-service to your internal customers: Here are five things Procurement organisations should start doing now to meet and exceed internal customer requirements.

Five things Procurement organizations should start doing now to meet and exceed internal customer requirements

“Procurement needs to be more proactive versus the Business initiating projects”

“Procurement needs to be an integral part of the team”

“Consult the Business before implementing any process improvement”

“Procurement needs to issue the POs in a timely manner. Waiting 3 days on a PO is unacceptable”

These are some comments we’ve recently heard when conducting a Stakeholder Survey (Voice of the Customer) as part of a broader Procurement benchmark for different clients. We often hear that Procurement is focused on meeting and exceeding customer requirements, but benchmarks from Hackett’s Procurement database shows otherwise.

The chart below shares that 30 per cent of Non-World-Class (Non-WC) organisations rated Procurement as an Administrator while only 15 per cent of Non-WC organisations rated Procurement as a Valued Business Partner. So, if this is the stakeholder’s perception of the Procurement organisation, what are some things you can do quickly to change this perception?

What is the Current role of Procurement in supporting business success in your area?

Other than changes to the organisation structure, there are five things that we believe Procurement can quickly do to improve internal customer perception and exceed internal customer requirements:

  1. All Procurement resources should be customer focused and empowered
  2. Dedicate specific Procurement resources to Help Desk activities
  3. Start conducting monthly training to educate internal customers
  4. Create a monthly/quarterly newsletter and share recent projects, success stories and upcoming projects
  5. Create an internal website to share Procurement information: FAQs, contact information, approved suppliers, success stories, process documents, etc.

1. All Procurement resources should be customer focused and empowered

We often hear the comment that perception is reality – unfortunately, there is some truth in this. As Procurement resources are typically focused on assisting end-users with different processes in Procurement, all Procurement individuals (whether they are internal client-facing or not) should be customer focused which means being helpful in problem solving and troubleshooting, being proactive, being a good listener, and feeling empowered to fix processes that are broken.

The term ‘fit-for-purpose’ or ‘fit-for-risk’ comes to mind when addressing broken processes. As Procurement works to address issues identified by its internal customers, it should determine whether the process is adequate or overkill for what the internal customer is trying to accomplish based on the value and appropriate risk appetite of the organisation.

2. Dedicate specific Procurement resources to Help Desk activities

Procurement activities are a complex string of processes. As such, we should expect our internal customers to have plenty of questions related to the process, status of transactions, etc. Dedicating specific Procurement resources to answer questions from internal customers is one of many ways Procurement can help address and resolve questions in a timely fashion. However, it is important to note that the more knowledge the Help Desk resources have about the usage of Procurement technology, status of sourcing events, process for sourcing, and a broad understanding of Procurement, the better they will be at being able to provide first-contact resolution.

3. Start conducting monthly training to educate internal customers.

Conducting monthly/ongoing training to internal customers will help provide them with the knowledge and latest information to perform their jobs. Ultimately, this will also help Procurement. There are various types of training that can be provided to include:

  • How to create transactions
  • How to create spend analysis reports
  • How to identify approved suppliers
  • How to use e-catalogs
  • How to manoeuvre the ERP maze

During these sessions, it would also be helpful to document the various issues that each of the internal customers faces. By addressing these issues, Procurement will be able to 1) ensure that internal customer requirements are met and 2) improve internal processes.

4. Create a monthly/quarterly newsletter and share recent projects, success stories and upcoming projects

Most of Procurement’s work goes behind the scenes and rarely do we share our success stories for one reason or another. However, creating a monthly/quarterly newsletter will help provide our Internal Customers with additional information on how the Procurement organisation is able to assist, help identify new projects and bring to light creative ideas from previous projects. In addition, it is also a way of demonstrating value that Procurement organisations bring along with some shameless self-promotion.

5. Create an internal website

While the monthly newsletter is focused on sharing the latest news, an internal website is another way of allowing our Internal Customers to perform self-service. There are various reasons to create an internal website including:

  • Sharing of information with our internal customers
  • Providing them a portal to log issues
  • Providing them ability to self-diagnose and resolve issues

As a member of the Procurement organisation, our role is to help support internal customers by listening, understanding, meeting and exceeding their expectations. Being front and center to our internal customers is important. Hopefully, these 5 activities can quickly help your Procurement organisation change your internal customers’ perception.

ProcureCon Marketing – Adidas and Agency Management

Procurious is reporting live from ProcureCon Marketing in London. All week, Jordan Early will be tweeting, blogging, listening and sharing his learnings about the challenging world of marketing procurement.

adidasphantomonfoot

Day one of the ProcureCon Marketing conference focused largely on the marketing side of the procurement-marketing coin, with speakers discussing marketing trends and movements in the agency space.

On day two, we changed gears slightly to look internally at the procurement role in that relationship. The insights that stood out most for me came from the guys at Adidas.

Both Michael Pues-Tillkamp and Phillip Schuster, who spoke in separate sessions, addressed the way the company’s marketing procurement team set an initial course to verify and increase contract compliance, but through this journey, managed to unlock a plethora of innovation, not only for Adidas but also for the agencies they were engaging with.

Categorising for Category Management

Pues-Tillkamp outlined how Adidas has categorised its digital marketing spend, allowing procurement to generate and execute category management strategies within the realms of marketing procurement.

The categories they devised were:

  • ‘Idea’ – which included spend on creative and research;
  • Connection’ – which included media and digital spend;
  • ‘Experience’ and ‘Brand Materials’ which represented the more customer facing side of their engagements.

If I understood correctly, the team was not completely active in these final two areas just yet.

Pues-Tillkamp also walked the audience through a strategic agency engagement process that Adidas uses to run everything from agency selection and on-boarding through to project execution and final evaluation of its agencies. Each step of this process is supported by documentation, process and in-house tools that promote consistency and enable the team to compare agency performance.

Can you benchmark marketing?

The team at Adidas, with the help of some ‘clever MBA students’, even managed to pull together a benchmarking tool that has enabled them to compare the performance of its agencies. The tool was developed using only internal data, but when you have the marketing budget that Adidas does, you amass a great deal of internal data.

The outcomes of this benchmarking exercise, according to Pues-Tillkamp, have allowed the firm to conduct more intelligent and sophisticated conversations with its agencies and have enabled the team to provide realistic advice to the Adidas marketing group as to what campaigns can reasonably be achieved with its allocated marketing budget.

What a week!

Next up to the mic was Phillip Schuster who announced to the crowd that, not only was he happy to be at ProcureCon for the first time, but also that his football team had won the FA cup at the weekend, his daughter had just been accepted into the Adidas day-care program and that at the end of the week he was about to go on a period of extended leave. Not an all-together bad week!

Aside from personal milestones, Schuster also detailed the journey undertaken by Adidas marketing to integrate and leverage the company’s main brands Adidas, Reebok and golf brand Taylor Made.

He outlined some of legacy challenges in his procurement teams’ relationships with its marketing agencies and suggested that large part of the problem was the fact that that, in marketing, you don’t know what the product or service you will receive looks like at the start of the engagement. It evolves, which makes it difficult to apply traditional procurement pricing and management mechanisms.

Schuster discussed Adidas’ approach to agency management referencing the benchmarking tool discussed above, but also incorporating external market auditing and agency performance analysis. He highlighted that this is something Adidas does as part of an ongoing process rather than on an ad-hoc or project basis.

Not just financial benefits

The outcomes of this agency management strategy have been multiple for Adidas. From a financial point of view, the company has been able to run tight fee reconciliations, have identified instances of incompliant rates, fees and mark-ups and now have far better understanding of whether or not an agency is charging a ‘fair price’. From a contractual point of view Adidas improved its briefing processes and were able to take a tighter control of the company’s budgeting.

Efforts to better understand their agencies enabled Adidas to understand the cost structures at these agencies. The firm was able to identify salary levels, overheads and ultimately profit margins of its agencies, which again provided the firm with some leverage come negotiation time.

When questioned by the audience on the response of the agencies to the audits, Schuster highlighted that most were very accommodating (this may have something to do with size of the Adidas account) and that a number of the findings uncovered in the audit process were actually viewed by the agencies as business improvement opportunities.

Stay tuned for more for the ProcureCon Marketing Event.

Tania Seary: The Business Case For Creating A Procurement Network

“But sometimes I worry that large portions of the procurement profession are uncontacted…”

Watch our fifth Big Ideas Summit keynote (part 1 of 3)

Watch Tania’s keynote in FULL here

Tania Seary, founder of Procurious, started off with an statistic that there are 27 indigenous tribes in the Amazon region that are entirely disconnected from the rest of the world, comparing that to the often isolated procurement profession.

Tania looked at the impact of social media on the profession, and how it can help to create the community for procurement to allow us to work together, solve problems and ultimately create value for businesses. One of these platforms is Procurious.

Procurious members can find Tania’s full keynote here. Not a member yet? Register for free.

Watch: See more Big Ideas from our 40 influencers

Five Tips For Effective Dispute Resolution

FIVE TIPS FOR EFFECTIVE DISPUTE RESOLUTION

“If the dispute negotiation fails then we can always litigate, right?”

As courts are backlogged there is an increasing trend for matters to be referred to alternative dispute resolution (‘ADR’). However, your commercial contract may commit parties to engage in several steps of ADR. Georgia Brandi provides insights to effective application of dispute resolution with five tips she hopes you’ll never need.

1. Include a dispute resolution clause in contracts

First, check whether your company’s contracts have a dispute resolution clause and become familiar with its elements. Multi-tiered dispute resolution clauses are popular setting out timing for each stage of the process as each party’s obligations increase. Examples can be found at the International Chamber of Commerce and local dispute resolution bodies.

Multi-tiered dispute resolution clauses typically require senior individuals in the organisation to meet. If that is not successful then the matter is referred to mediation. If unresolved the matter is referred to arbitration. Only if that fails can the matter be referred to litigation. Each step is a pre-condition for the next.

2. Know the difference between methods of alternative dispute resolution

Two popular ADR methods are mediation and arbitration so it’s prudent to know how they differ.

Mediation uses an impartial third party to facilitate an interests based discussion. The mediator does not provide advice or determine an outcome. The discussion is confidential and the parties reach their own agreement and it is self-enforced.

Arbitration is however determinative and may not be confidential, subject to the relevant body’s arbitration rules. For cross border disputes, also note whether the country is party to the New York Convention for enforcement of arbitral awards.

3. Know when a dispute is a dispute and track time

Usually receiving a letter with ‘DISPUTE NOTICE’ stamped on it is a good indicator. It may not be that obvious as another party may assume their communication is a dispute notice by its content. Does the supplier think a late invoice demand notice satisfied criteria for a dispute notice? Seek clarification if you’re unsure because once a dispute notice is received time will start ticking, so know when you need to respond. Also know who needs to be advised e.g., legal counsel, CPO.

4. Agree on the basics

It would be awful to trigger further debate on who pays the mediator/arbitrator fees or what language the process will be conducted. Draw your mind to the basics such as allocation of costs, location, dispute resolution body and language of proceedings within the contract. Courts may sever elements of a dispute resolution clause for uncertainty.

5. Understand dispute resolution trends in the jurisdiction selected

If your clause elects a dispute resolution body, look at their rules. There may be provisions for a combined method of mediation and arbitration such as ‘arb-med-arb’ in Singapore and ‘med-arb’ which is trending in Hong Kong and China. Although both parties need to consent, understand the reason for the trend and what benefits are available. For example, mediation in Japan offers the benefit of confidentiality where there is otherwise no without prejudice privilege.[1]

Many disputes can be diffused with an interests based discussion[2] and practically may not be suitable for litigation where the core issue is commercial. However I encourage you to become familiar your company’s dispute resolution clause and approach to managing disputes. And ensure your company’s legal counsel is always consulted.

[1] The Japan Commercial Arbitration Association International Commercial Mediation Rules, Rule 12.

[2] See e.g., Fisher and Ury “Getting to YES: Negotiating Agreement Without Giving In”.

ProcureCon Roundtable – Attracting and Retaining Digital Marketing Procurement Talent

Procurious is reporting live from ProcureCon Marketing in London. All week, Jordan Early will be tweeting, blogging, listening and sharing his learnings about the challenging world of marketing procurement.

procurecon_marketing_je_talent_1024

It’s day two of the ProcureCon Marketing event in London’s Hotel Russell.

Yesterday, I had the chance to sit in on a roundtable discussion, chaired by the indelible Myriam Benichou, the global purchasing director of marketing services at L’Oreal and attended by industry leaders from leading companies such as a Nestle, Coca-Cola, Renault, Sony and Novartis. The topic was ‘What are the competencies and how do you find talent in the digital marketing procurement space?’.

It’s a good time to be a digital marketing procurement professional

Procurement’s talent attraction dilemma has long been a topic of discussion on Procurious and beyond. Put simply, it’s been hard for procurement to attract top talent (even for companies with enviable global brands like L’Oreal and Coca-Cola).

This challenge amplifies when it comes to finding procurement people that understand that intricacies of marketing procurement and is further magnified when it comes to locating procurement staff that understand the rapidly changing (not to mention, highly competitive) nature of digital marketing.

So, for this discussion at least, we find ourselves at the thin edge of wedge.

During the roundtable, there was some great debate and discussion around what procurement teams can do to attract and retain digital marketing talent. Companies like Nestle and McCormick are going directly to universities to track down the new and evolving skillsets they require to operate in the digital marketing space. The external talent pool is so small, they said, that developing new young talent is critical. I also got the impression that the gloves were off for procurement teams looking to poach talent. If you are a digital marketing procurement professional, your stocks are high right now.

The idea that procurement teams should hire generalists or high potential employees from within their firm was also positioned as a potential strategy for filling digital needs. While there is a limited pool of digital talent in the external market, digital marketing is not exactly rocket science and given time and adequate resources, it’s possible to develop someone into a sound digital marketing procurement professional. A roundtable attendee from Novartis echoed these sentiments.

Enable procurement-marketing rotations

Many firms mentioned they were ’borrowing’ staff from marketing on secondment into procurement. It was, in fact, highlighted that marketing instigated a number of these arrangements as means to instil some of the commercial rigour procurement had a reputation of providing back into their own function.

One of the most interesting points I heard was that firms were collaborating across functions during the recruitment process for digital procurement talent. At Nestle, if you’re interviewing for a job as a marketing procurement professional, a senior marketing executive will interview you at some point. Given that they will effectively be your internal clients, this seems like a great way to create engagement and buy-in between procurement and marketing.

In terms of attracting new talent, a few of the larger firms mentioned that keeping a close relationship with your digital agencies was a great way to know when talent was moving in the market. Clearly, your agencies are working with, and posses a close knowledge of, many other procurement teams, so by keeping them close, you might just be the first to know when great talent is on the move.

The discussion was indeed interesting and the ideas truly innovative. However, I couldn’t help but feel that while these strategies, job rotations, calling in favours with the agencies and spending big on developing high potential staff members may be possible for the Nestles, Cokes and Sony’s of the world, the challenge will be more difficult for those without the budget and brand name of these larger firms.

Stay tuned for more for the ProcureCon Marketing Event.

If you were offered unlimited leave would you take it?

If you were offered unlimited leave would you take it?

It seems like a stupid question. You would no longer miss friends’ weddings. You could spend more time sailing, skiing, singing or whatever it is that makes you happy. Maybe you could even take that trip to Japan you promised your partner all those years ago…

On the surface, unlimited leave sounds a like a no-brainer for employees, but in recent years a number of companies have implemented these schemes and, perhaps surprisingly, they’ve tended not to work out.

Most people, myself included, would assume that an unlimited leave policy would result in workers taking more days off. However, the opposite is true. Firms with unlimited leave schemes in place have found that their employees are in fact taking less time off.

This is a worrying finding, as studies show that employees who take time off from their jobs return to work happier and more productive.

The fact is that our brains need breaks. The National University of Singapore found that “those who spent less than 20 per cent of their time perusing the Internet’s silly offerings were 9 per cent more productive than those who resisted going online.”

In the same way that watching the occasional cat video can improve concentration, taking a longer break improves people’s performance when back at work. A CCH Human Resources Management study showed that over 50 per cent of employees felt more “rested, rejuvenated and reconnected to their personal life” and that almost 40 per cent of workers “felt more productive and better about their job” after returning from time off.

So what is wrong with people?

Why don’t we take advantage of unlimited leave? The problem seems to be a matter of human psychology. Rather than seeing the opportunities and benefits that can come from the increased flexibility of unlimited leave, workers tend to focus on the negative aspects that might accompany the program.

No one wants to be seen as ‘the guy who takes the most leave’ as being thought of as ‘that guy’ can be linked to laziness or worse still worthlessness.

Mathias Meyer, of the firm Travis CI, provided the following insight into his organisation’s experiment with unlimited leave.

“When people are uncertain about how many days it’s okay to take off, you’ll see curious things happen. People will hesitate to take a vacation day, as they don’t want to seem like that person who’s taking the most vacation days. It’s a race to the bottom instead of a race toward a rested and happy team.”

Some of us want to ‘earn’ our fun

It’s a strange thing, but I think there is a large group of people who want to have worked hard and banked away their annual leave before booking a holiday. These people are looking for the sense that they have ‘earned’ their holidays. They’ve worked hard and the vacation days are a form a currency for this work that they are now entitled to spend.

The future of leave 

According to The Society for Human Resource Management unlimited vacation policies are only offered at 1 per cent of US firms, but a further 2 per cent of firms are said to be considering such programs. Tech and start-up firms like Groupon and Netflix dominate the group that has already adopted unlimited leave programs.

Unlimited leave policies, if implemented properly, certainly seem like an effective way to attract Millennials to your firm, not to mention a great way to remove annual leave accruals from your balance sheet.

I would also dare to suggest that outside of the US, where the majority of research and anecdotal evidence on unlimited leave programs has come from, the figures around staff actually using their leave entitlements under such schemes may be a significantly higher.

US employees across the board tend not to use their leave allocation. Only 51 per cent use their full allocation and 15 per cent use no leave at all. French workers, on average, take twice as many vacation days their American counterparts.

5 critical ways the UK needs to view supply chains differently

Jan Godsell on keeping Britain at the heart of global manufacturing with the help of supply chain companies.

Keeping Britain at the heart of global manufacturing with the help of supply chain companies

Jan Godsell, Professor of Operations and Supply Chain, WMG at University of Warwick, has provided Procurious with her thoughts on the importance of Britain needing to have a greater understanding of its supply chains across industry.

Jan says: “Today, many supply chains are misunderstood, neglected but brimming with potential, much to the detriment of the UK’s entire industrial base. Big opportunities that could set the UK on the path to becoming an important hub for international supply chains are currently being ignored.”

As evidence continues to mount that production is increasingly being re-shored back to the UK, certain questions spring to mind: Does Britain have the right logistical and communication structures in place to support a new wave of manufacturing activity? Are supply chains integrated and streamlined enough for smaller companies to operate leanly and efficiently? What are the restrictions on the supply side and how can they be broken down? And, what are the opportunities in the UK and abroad if businesses develop their supply chain capacity to reach their full potential?

Professor Jan Godsell covered these key issues during the Crimson & Co’s annual supply chain academy on 27 April, which is dedicated to sharing worldwide best practice across the end-to-end supply chain. Jan also noted her insights on the issues affecting global supply chains in the recent APMG Term Paper.

“The supply chain has been de-scoped to focus primarily on procurement and supply management. In today’s globalised world, such a narrow perspective can be damaging to the UK industry. It’s about recognising global demand and configuring the right global supply chains to meet this demand effectively (meeting the customer requirements in terms of cost, quality, time and increasingly environmental and social sustainability). Failure to do so will see the UK become increasingly marginalised with no recognised role or expertise to contribute to the global supply chain network. The good news is that it’s not too late for the UK.”

Godsell explains that with the aftershock of the global financial crisis still reverberating and traditional models being challenged by the internet, the time is right to revisit the role that the UK plays in global supply networks. Whether this be local supply to meet the demands of the UK market, regional supply for the European market or global supply for the world. To capitalise on this opportunity and redefine the UK’s role at the heart of the global supply chain network, there are five critical ways in which the UK needs to view supply chain’s differently.

Jan continues:

1. Functional to holistic perspective

“The UK needs to return to the origins of the supply chain and view it more holistically. Within a company, this means recognising the full scope of all the operational processes that define the supply chain. The core processes are Planning, Procurement, Manufacturing, Logistics and Return (which covers reverse logistics, repair, remanufacture and recycling). These processes are used to understand customer demand and translate it into effective and efficient supply.

2. Manufacturing to planning centric

“If the UK wishes to maximise the role that it plays within a global supply chain network, it needs to consider the different ways in which the UK can contribute to manufacturing. The success of a global supply chain network relies on the correct positioning of the factories, suppliers and warehouses around the globe, to serve different markets. Planning is the “glue” that holds the supply chain together yet it is poorly represented. There is a huge opportunity for the UK to continue to develop a full range of supply chain planning capabilities, and to position the UK as the supply chain planning hub of the world.

3. Re-shoring to right-shoring

“Manufacturing is returning to the UK and one of the main reasons why this is happening is because businesses have started to look at their cost base more holistically and in relation to their competitive priorities. They are no longer fixated with production costs (and labour costs in particular) but are taking a more holistic view of the total cost of sourcing. The challenge for organisations is identifying the most appropriate supply chain network to support their business in order to determine which elements of their production should be made locally, regionally and indeed globally. It’s not about re-shoring but right-shoring. We should enable our businesses to right-shore, as it allows them to understand their strategic priorities and core capabilities, to develop the right global supply chain network and essentially to ensure the success of individual businesses and the UK economy.

4. ‘After thought’ to an integral part of strategy

“UK businesses need to ensure that supply chain strategy is an integral part of their business strategy and find innovative ways to both increase sales today and reduce costs tomorrow. This will require increased presence of those with supply chain expertise at the board level.

5. Specialist function to a pervasive part of our social fabric

“All roles in the supply chain are equal, as a supply chain is only as strong as its weakest link. We need a nation where our boards have good supply chain representation and have congruent strategies to enable competitiveness today whilst building capability for tomorrow, where everyone in the UK understands the importance of our supply chains and the critical role that each and everyone plays in supporting our nation. Together, we have the opportunity to put the UK back at the heart of the network of global supply chains, back at the heart of the global economy.”