Category Archives: In The Press

How to Manage Supply Chain Risks From the Coronavirus Outbreak

Are you being proactive in managing risks to your business from the coronavirus?

supply chain risks


The death toll from the coronavirus has reached more than 2,800 and the number of confirmed cases has exceeded 80,000. 

Beyond the enormous human toll, the effects of the coronavirus and the efforts to control its spread are being felt throughout the world’s supply chains. 

Factories in China are facing staff shortages. Or they are electing to remain closed to protect their workforce. Airlines have suspended flights to China. 

However, there is an indirect result of the necessary steps being taken to contain the outbreak. Restrictions and regulations designed to control the spread of the virus could have an adverse impact on cargo leaving and entering ports all over the world. 

Delayed Effects

And while some of the impacts have been immediate, other latent effects will not be felt for months.

This will hit:

  • manufacturers and retailers who rely on affected products and labour
  • logistics haulers expecting to transport the material
  • and, ultimately, the end consumers.

This crisis demonstrates the increasing complexity – and global nature – of supply chains and the imperative need to manage risk within this complex supply chain. 

Compare the current outbreak with that of SARS in 2003. It is striking to see how quickly coronavirus has eclipsed SARS in the number of infections. It took the coronavirus only 2 months to infect 75 per cent of the total number infected by SARS over a 9-month period. 

The crisis also shows how much China has developed in terms of population and establishing itself as a key cog in the world’s economy.

There is a danger of coronavirus becoming a major global issue if not controlled closely. So, what can organisations do to prepare themselves for these impacts?

Many leading organisations have developed programmes to manage and deal with supply chain disruption. But this situation is a unique challenge for even those organisations with advanced risk management programmes. 

Regardless of the level of sophistication in an organisation’s risk programme, all organisations can take steps to monitor their supply chain. This will help them to for the impacts of the epidemic.

3 Key Steps to Manage Risk

1. Know where your supply chain is located

Identify those countries that are currently at high risk and map your supply chain against these affected areas. This mapping should include evaluating key tier 2 and tier 3 suppliers as well as key logistics hubs that could be impacted.

2. Continuously monitor changes

Understand that the crisis is still unfolding and the true impacts from a supply chain disruption perspective may not reveal themselves for months. Establish a process to monitor other regions outside the infected areas that could be impacted.

Are ports outside the infected areas being impacted through disruption or through new regulations to protect against transmission of the virus? Are suppliers struggling financially without access to the Chinese markets, jeopardizing their viability?

3. Diversify the supply base

Like a financial portfolio, look for opportunities to rebalance and diversify the supply base to minimize the risk and take actions to qualify these suppliers in the event they are needed.

Need for Proactive Risk Management

This crisis underscores the need for organizations to establish and maintain effective proactive risk management programmes for their supply chain. 

It is impossible for organisations to anticipate these types of outbreaks. But an effective risk management programme, complete with processes, tools and data can lessen the impact. And the time it takes an organisation to recover.

Learn more about the challenges and steps necessary to build an effective and proactive Supplier Risk Management programme in this research “Integrated Risk Management: A Playbook for Procurement” from The Hackett Group.

How The Coronavirus Will Impact Your Supply Chain And What To Do About It

What key steps can you take limit the potential effects of the coronavirus on your organisation?


In China on 9 February the world received news it didn’t want to hear.

The number of confirmed deaths from the coronavirus has now overtaken that of the 2003 severe acute respiratory syndrome (SARS), with more than 1000 casualties. 

In addition to that, the virus is spreading at an alarming rate. There are now more than 40,000 confirmed cases. And this number is increasing as much as 20% every day.

While the virus is terrifying from a public health perspective, it’s also alarming in terms of your supply chain. Wuhan, China, the epicentre of the virus and now a city in total lockdown and complete disarray, is one of the world’s largest industrial hubs. 

Here’s how the coronavirus is affecting global supply chains – and what you can do about it. 

Production delays and factory closures

If you’re currently manufacturing anything in China, especially in the Wuhan area, you can expect significant production delays.

Fashion fit innovation company Alvanon, who manufacture dress forms in China, has issued a statement saying: 

‘We expect at least a four-week delay on physical goods that have already been paid for. Our factory is currently closed, and while we are doing all we can to minimize delays, we currently do not know when it will reopen.’ 

Currently, all public gatherings in Wuhan are forbidden. All factories and public places are closed. The flow of goods in and out of the area has come to a halt. 

Reduction in freighting capacity 

The coronavirus is now confirmed in more than 23 countries. And the world’s airlines are responding by cancelling flights to and from China. 

Airlines all over the world have ceased some or all of their China freight routes. 

Sea freighting is also likely to be affected. If you have goods in transport from China, there may be significant delays in them leaving major ports. And when they do leave, there’s a risk that crew will become ill on the journey. 

People movement

Freight is not the only thing that needs to come and go out of China. People also do, for business or leisure. 

The restrictions on flights will start to impact business agendas.

Many international companies are shutting down their offices in China and restricting all travel. 

Commodities market and the broader economy

From a supply chain perspective, what’s most concerning about the effect of the coronavirus is the already devastating impact it is having on the commodities market and the broader economy. 

As one of the world’s largest consumers of commodities, decreased demand in the Chinese market has now caused many commodity prices to slump. Copper has fallen 12% and crude oil 10%. The Bloomberg Commodity Index has taken a 6% hit. Analysts expect these decreases to continue.

Economists warn that the impact on the economy more broadly could also be dire. They believe that the fallout from the virus will be significantly worse than the SARS epidemic. 

The Chinese economy is much larger than it was then. But it’s also weaker, due to the continued US trade wars. 

China’s GDP growth is on track to slow (at least) in the first quarter, and analysts aren’t sure it will recover. This will, in turn, affect exchange rates and emerging markets. 

Developed economies are also expected to suffer. The downturn in Chinese tourism is expected to impact Australia’s economy to the tune of $1 billion.

What should you do? 

How can you manage the risk coronavirus represents for your organisation? 

Justin Crump, Procurious consultant CEO of Sibylline, a world-renowned risk management consultancy, recommends that procurement takes the following actions immediately.  

1. Understand cascading supply chain consequences

‘You need to understand more than just your suppliers,’ says Justin, ‘as it will be second-order problems that bite when you think you’re okay.’ 

To do this, Justin recommends you dig further to understand supplier dependencies.

A great way to do so might be to survey your suppliers. Test their exposure to the virus, and then try and mitigate any issues early. 

2. Stockpile if you can 

It might be too late for some, but Justin recommends that everyone who is able ‘tries to stockpile while you still can’. 

This is difficult for those practising just-in-time manufacturing.

But Justin thinks that if you can still action this advice you’ll benefit – as oil prices are substantially lower due to a steep fall in demand. 

3. Invest in resilience

Procurement should never be reactionary when it comes to risks, Justin reminds us. ‘But now, more than ever, you need to invest in resilience.’ 

Justin believes this ‘resilience’ needs to come in multiple forms.

For example:
• look into alternate suppliers – and move now to get ahead of your competitors
• consider impacts on staff, families and customer relationships 
• think long-term about how travel and freighting might be affected

4. Consider the bigger economic picture 

It’s tempting to focus on the now, Justin says. But it’s important to consider the bigger economic picture and how you might need to mitigate that risk (if that will even be possible). 

5. Appraise the effect on international relations

All large businesses depend on international relations to a degree Justin says, ‘so the effect on international relations shouldn’t be underestimated’. 

Justin thinks it’s important that we don’t rest on our laurels and just assume business will continue as usual.

‘What I see happening is that China is quietly blaming the US in some circles for the outbreak, calling it a deliberate attack,’ he says. ‘Likewise, the US is using this to encourage businesses to pull out of China. 

‘China blaming the US feels like more of an insurance policy to deflect criticism from the regime, but still . . . it’s a reminder that the global network is under threat.’ 

So bear in mind Justin’s analysis and consider taking these 5 steps to limit potential supply-chain difficulties resulting from the coronavirus. 

What effects are you seeing on your supply chain from the coronavirus? How are you managing risk? Tell us in the comments below. 

Interested in more hot tips on how to improve your supply chain approach and get more productive? Join the Procurious community of 37,000 members where you’ll find daily inspiration.

World’s Most Dangerous Supply Chains: Bolivia’s Death Road

Travellers on Bolivia’s ‘Death Road’ are given a stark visual warning about why the mountainous gravel pass is considered one of the world’s most dangerous supply routes: hundreds of crosses line the track to commemorate the frequent fatalities.

Formally known as La Cerretera de los Yungas, the vertigo-inducing path was once notorious for claiming the lives of up to 300 travellers a year as their cars, trucks and even buses careened over the unprotected roadside and down sheer 1000-metre cliffs.

In July 1983 a bus fell into a canyon, killing all 100 people aboard, while in 1999 eight Israeli travellers died when their vehicle did likewise.

Judging by the pictures and YouTube clips of what can only be described as a “glorified goat track”, it’s a wonder the death toll has not been even higher.

Also known as the North Yungas Road, the conduit stretches 69 kilometres up jungle-clad mountains between the Bolivian capital of La Paz and Coroico, in the Amazonian Yungas region.

The road was built by Paraguayan prisoners of war during the three-year Chaco War in the early 1930s to facilitate a military supply chain linking the Bolivian Amazon to the capital. The miserable living conditions of the construction crews set the tone for locals forced to use the supply route to transport crops, timber and materials to and from La Paz for the next eight decades.

Navigating the jungle-clad La Cumbre mountain pass, the twisting and turning road climbs as high as 4650 metres before descending a winding 54 kilometres to 1200 metres (the world’s longest uninterrupted downward stretch).

As a wise precaution, motorists are known to pray before embarking on the route.

“This road has humbled many egos,” says the Dangerous Roads website. “It’s not for the sissies and shouldn’t be attempted by novice drivers.”

In 1995, the Inter-American Development Bank described Yungas Road as the world’s most dangerous – no mean feat given the glorified goat tracks in regions such as the Himalayas.

The road is so dangerous that, unlike in the rest of the country, vehicles drive on the left so that the driver has a clearer view of the positioning of the wheels on the crumbling roadside.

In the wet season, the single lane road is made even more hazardous by mud, fog, rockfalls and landslides. Waterfalls are known to cascade across the road, taking much of the gravel with them.

In the dry season, choking dust reduces visibility to metres. Wisely, vehicles travelling downhill need to give way to ascending ones, as this forces them to slow down.

In the early 2000s the road was given an upgrade of sorts, with two driving lanes, proper asphalt and protective barriers.

But judging by recent photos, it’s still not exactly autobahn-quality.

The puzzling element is why anyone would continue to use it – apart from intrepid cyclists who have spawned a whole new industry. That’s because the Bolivian government completed a new nearby road in 2009 which, while mountainous, is more in line with western standards.

A 2013 clip from the UK motoring show Top Gear gives a good picture of the type of traffic encountered. Despite this safer alternative, the road remains popular as a supply route for locals, as tarpaulined trucks and even petrol tankers compete for space with buses and four-wheel-drives.

Host Jeremy Clarkson also gives a near fatal lesson in overtaking procedure, as his Range Rover comes perilously close to departing the road.

The footage might be edited for dramatic effect, but Clarkson’s manner suggests he is in genuine fear of producing his very last show. While the Yungas Road may no longer be the mandatory conduit between La Paz and Coroico, the adventure cycling business trades off its grim appeal.

It’s estimated that at least 20,000 extreme pedal-pushers brave the route every year, which exacerbates the dangers for all road users.

While most return home with tall tales and an ‘I Survived Death Road’ T-shirt, at least 20 cyclists have thought to have been killed on their road in the last two decades (exact numbers are unknown).

As might be expected, a thriving cycling tour guide industry has evolved, with a commensurate rise in four-wheeled transport for equipment and supplies to service the expeditions.

Intrepid cyclists are well advised to pick their tour operator carefully. As Australian journalist and Yungas cyclist Andrew Fenton writes, even the mid-range ones leave much to be desired.

“At one point the guide lines us up on our bikes at the edge of the cliff for a photo, and jokes: ‘OK, now everybody take a step back’!

“Hilarious—except one of the riders takes him seriously. His back wheel is hovering in space by the time we grab him.”

While La Cerretera de los Yungas’ Death Road cachet endures, adrenalin-seeking westerners may be heading to the wrong country: the Dangerous Roads site dubs an obscure Turkish pass called Bayburt Of Yolu-D915 as “probably more dangerous” than the Bolivian road.

Climbing to 2300 metres above sea level, the 105 kilometre road navigates 28 hairpin turns, linking Of and Bayburt in the country’s east. It’s a working road used by locals driving anything from trucks to motorbikes – and a highway to hell for the careless and impatient – or plain unlucky.

Three Key Steps To Getting Brexit Ready

It’s been over two years since the UK voted to leave the EU. But beyond the exit date of 29 March 2019, little is known about the details of the Brexit agreement…
Negotiations between Brussels and Whitehall are rumbling on with little sign of a breakthrough. And the longer they continue the less likely it seems a deal will be struck.

A recent EU exit impact study conducted by Efficio for a UK central government department indicated a potential 8 per cent increase in costs as a result of Brexit.

Yet a poll of 800 business leaders carried out by the Institute of Directors has revealed that 49 per cent of businesses do “not anticipate drawing up nor implementing any contingency plans for Brexit”.

Similarly, a Survation survey commissioned by Maritime UK found that nearly half of businesses polled have done ‘very little’ or no preparation in anticipation of the UK leaving without a deal – despite two-thirds of business leaders believing such a scenario is ‘very likely’ or ‘likely’. Only 27 per cent  consider it ‘unlikely’, with another 8 per cent saying they are unsure.

Stick or twist?

Few can argue that these are unprecedented times, the likes of which Europe has never seen before. There’s no blueprint for untangling member states from the union – a situation made more complex by the need for Brussels to safeguard the EU project and potentially make the UK pay a high price for ‘independence’.

The majority of public and private sector organisations appear to be biding their time, waiting to see the terms of an exit agreement before they invest time and money in putting contingency plans in place. Is this a deliberate, tactical approach? Or could it be that procurement teams are unsure of what action to take and/or lack the capacity to deal with the task ahead?

Whatever the situation, now is not the time to hunker down and do nothing. On the contrary, businesses should be using these crucial few months to assess the scale of the impact on their supply chains and ready themselves to respond to what lies ahead.

Sourcing strategies, suppliers, contracts

Organisations should start by considering three core pillars of procurement, namely existing contracts, sourcing strategies and current suppliers.

1. Contracts

Form a clear understanding of your contract risk profile. Identify your risks against a hierarchy of needs. Examples of potential risks may include EU funding reliance, lack of freedom of movement restricting labour availability and driving wage increases or foreign exchange and tariffs creating cost pressure. Examine key contract clauses linked to EU exit readiness, such as termination, cost pressures and continuity resulting from legal change to determine where further risks may lie.

2. Sourcing strategies 

Review your existing category strategies to understand category objectives, sourcing strategies and the pipeline of work. Identify which elements will be affected by the EU exit and, where this impact is significant, determine how to take account of EU exit activity in your category plans.

3. Suppliers

Engage your suppliers and assess the wider market to pinpoint cost and risk drivers in key categories. Work with your suppliers to review expected pressures resulting from Brexit, their current mitigation plans and their view of the company’s main risks. Then encourage them to implement effective business continuity plans.

Deep knowledge of these areas, coupled with strong contingency plans to deal with change, are essential to manage risks and seize opportunities.

Act now to get ahead

Efficio is working with a number of public and private sector companies, including large central government departments, to carry out detailed readiness analysis ahead of the EU exit. The service is designed to prepare organisations to make fast, structured change and mitigate risk when the time comes.

To find out how we can support you in getting Brexit-ready, visit our website.

Take the Nuclear Option at UPMG2018

Not many procurement conferences include a guided tour of a nuclear facility! Be sure to check out UPMG2018, the premier conference for utility purchasing managers.

Go nuclear

Remember the Fukushima Daiichi nuclear plant disaster in 2011? As part of the international review that took place after the event, the United States instituted the “SAFER” program. National SAFER Response Centres (NSRCs) house emergency backup equipment for all commercial nuclear plants in the U.S., ensuring the ability to move emergency equipment to affected nuclear plants within 24 hours by truck, plane and helicopter.

At ISM’s UPMG2018 conference (9th to 11th September, Scottsdale AZ), attendees will have the opportunity to tour a SAFER Response Centre under the guidance of the Southern Nuclear Operating Company.

Speaking of disasters, Michael Menges of Edison Electric Institute will be presenting a review of the mutual-assistance effort coordinated by electric trade associations, where multiple utilities aided in Puerto Rico’s restoration following Hurricane Maria. A panel of industry subject matter experts will discuss the supply chain impact around logistics of fleet mobilisation in Puerto Rico, the work management process necessary to coordinate the restoration effort, and material needs and challenges. 

Get to grip with a rapidly changing environment

Utilities Purchasing is a category that never stands still, as the landscape keeps shifting with breakthrough technologies and disruptive forces including climate change. UMPG2018’s agenda includes sessions to ensure attendees are kept up-to-date, such as:

  • Shifting Business Models in the Power Industry (featuring David Jacoby, BSI Energy Finance)
  • Innovation in the utility space
  • Supply chain disruptors
  • Actionable information to better understand economic conditions (insights from ISM’s Report on Business)
  • Blockchain application for utility industry.

Tap into the talent pipeline

This year, UPMG2018 has a strong focus on up-and-coming talent, with sessions including:

  • Attracting Millennials to Supply Chain (featuring a panel of young talent from Intel, Black Hills Corporation and Exelon)
  • How to Build a Successful Career in Supply Chain
  • University Student Presentations.

The Utility Purchasing Management Group (UPMG) exists to exchange information and provide a forum for divergent views, all directed toward increasing the knowledge of purchasing as it applies to and affects both utility purchasing management and their suppliers. Officers, managers, and employees of gas, electric, and telecommunications utilities – either investor-owned or government-owned, as well as consumer-owned, not-for-profit electric cooperatives, public power districts, and public utility districts – who are directly involved in purchasing or materials management make up the membership of the UPMG. Register for UPMG2018 now at http://upmg.org/.

 

In other news this week:

Reshoring in Reverse Again

A.T. Kearney’s most recent Reshoring Index has revealed that despite the Trump administration’s “Made in America” focus, imports from traditional offshoring countries are at a record high. Some compelling findings include:

  • The largest one-year increase in imports from Asia to the US, a staggering $55 billion dollars (up 8% from 2016), since the economic recovery in 2011.
  • The Reshoring Index has dropped 27 basis points since rising to a 5 year high in 2016.

Download the report: http://bit.ly/2ubCZ3a

Demystifying The 2018 Gartner Magic Quadrant For Procure-to-Pay Suites

Gartner named Basware a Leader in the 2018 Magic Quadrant for Procure-to-Pay Suites for the third time – but it’s not as mysterious as it seems. Read on for a demystification of the Gartner Magic Quadrant evaluation process.

Everett Collection/ Shutterstock

It’s Not Magic – It’s Basware

I’m not sure why it’s called the Gartner Magic Quadrant but I’m sure that there’s no magic behind our recognition as a Leader. In my role as Senior Analyst Relations Manager, I have the unique opportunity to interface with nearly every aspect of our global business from research and development to product management to customer support to sales and marketing, and I can tell you our success boils down to 2 things – we’re 100 per cent obsessed with customer success and we work hard to deliver.

Why is Gartner so influential and how are purchase-to-pay vendors evaluated?

With over 15,000 employees and over $3 billion in annual revenue, Gartner is a massive research and advisory firm that has a strong reach in the purchase-to-pay market, particularly with CIOs. Its reports are widely read, and the Magic Quadrant is regarded as a useful tool in creating vendor shortlists. The report comes with a graphic that depicts the purchase-to-pay market using a two-dimensional matrix that evaluates vendors based on their ‘Completeness of Vision’ (horizontal axis) and ‘Ability to Execute’ (vertical axis).

‘Ability to Execute’ primarily focuses on the caliber of the vendor’s products and services, including core pieces of purchase-to-pay functionality such as e-procurement, catalog management, e-invoicing, and accounts payable invoice automation. Another key piece of execution is customer experience, which takes into account feedback gathered via online surveys, inquiries into Gartner, and calls between Gartner and purchase-to-pay customers.

‘Completeness of Vision’ is an appraisal of the vendor’s ability to map the direction of the market and outflank competitors, as well as innovate to meet customer needs. Vendors are evaluated around vertical/industry strategy and the speed with which they can bring innovation to their offering (e.g. robotic process automation, advanced analytics and machine learning).

Gartner’s evaluation of vendors is supported by inquiry calls, face-to-face meetings, survey tools, product demos, and briefings. We feel they are looking to understand how solution providers appeal to CPOs, CFOs, and CIOs and how the product meets the needs of those key stakeholders. Gartner first issues an online survey and then talks to two different customers verbally for each provider.

How are solutions evaluated?

Gartner uses surveys, customer interviews, and extensive solution demos, to evaluate the provider’s vision and their ability to execute on that vision by bringing innovation to life within the product.

Through our experience with the process, we believe that the following capabilities are being assessed:

  • Core procure-to-pay functionality from e-procurement through ok-to-pay
  • Global deployment suitability to maximize the value across the world
  • Platform capabilities like mobile features
  • AI & machine learning and smart technology applications
  • Integration to ERPs and other back-office systems
  • e-Invoicing sophistication and network reach
  • Customer support and implementation aspects
  • Packaged analytics
  • Supplier information management tools
  • Source-to-settle solution integrations
  • Personal consumable workstream support for configuring complex workflows
  • Requisition MRO workstream support to automate more processes
  • Contingent work force procurement to automate the requesting of labor
  • SOW services governance and procurement
  • Direct order support
  • Travel & expense capabilities to capture more enterprise spending
  • Supply chain finance to support cash flow management

What factors make Basware a Leader in the Gartner Magic Quadrant for Procure-to-Pay Suites?

Based on the information contained in the 2018 Gartner Magic Quadrant for Procure-to-Pay Suites, we believe our 30+ years of industry expertise, strategic vertical approach, market-leading products and obsession with customer success landed us in the Leaders’ quadrant for the third time.

Our number one goal as a company is customer success. We empower customers to simplify operations and spend smarter to reach competitive agility by getting 100 per cent spend visibility through on-boarding 100 per cent of suppliers, capturing 100 per cent of invoices and achieving 100 per cent user adoption of e-procurement.

So, I think it’s important to call out four areas that Gartner commented on in the report that best demonstrate our 100 per cent promise:

  • Global deployment suitability to connect, streamline and strengthen operations with ease for enterprises across the world, helping them collect 100 per cent of financial data from all locations
  • World-class products that enable organizations to capture 100 per cent of invoices and achieve 100 per cent user adoption of e-procurement to leverage the power of their financial data and create a competitive advantage
  • Ease of integration using standard APIs and tools so companies can easily connect the solutions they already have for more visibility and value
  • An extensive global e-invoicing network that connects small and large businesses world-wide to on-board 100 per cent of suppliers.

Read more here 

Gartner Inc., Magic Quadrant for Procure-to-Pay Suites, Desere Edwards, William McNeill, Magnus Bergfors, Patrick M Connaughton, Kaitlynn N. Sommers, May 29, 2018.

Life Without Beer, Bacon and Crumpets?

Beer, bacon supplies at risk as a national shortage of food-grade carbon dioxide (CO2) threatens a whole range of everyday consumables.  

Image: Lukasz Engel/Shutterstock.com

Why is there a CO2 shortage in the UK?

Food-grade CO2 in the UK is sourced from European ammonia plants, which usually close for maintenance in the summer months when demand for fertiliser is lower. This year, five producers in Europe and a number of bio-ethanol plants have shut down at the same time, leading to shortages not only in the UK, but across Europe. The situation is a result of a combination of planned shutdowns and unexpected equipment failure.

Who has been affected?

  • Brewers – C02 is needed in the bottling and kegging of beer. A Europe-wide beer shortage is particularly noticeable in the middle of a World Cup.
  • Soft drinks and carbonated water.
  • Packaged foods such as bagged lettuce and crumpets that use “modified atmosphere packaging” to extend product shelf-life.
  • Slaughterhouses use CO2 to kill pigs and poultry.

Is there an alternative?

According to Wired, there’s currently no alternative to CO2 that offers its range of benefits, such as its ability to prevent microbial growth and its inertness. It is also safe to transport and doesn’t affect the flavour of a food.

The good news? Two ammonia plants are expected to come back online this week, with supplies returning to normal within a fortnight.

Presumably the affected producers will be working with suppliers to ensure the same situation doesn’t occur in the summer of 2019.

Brexit: What Happens Now?

Brexit is complicated and it’s very, very messy. And what happens during the next couple of years will be determined by a number of political factors…

At last month’s CPO roundtable Anand Menon, Director of the UK in a Changing Europe based at Kings College London, spoke to us about the long-term causes of Brexit and their future implications.

“Hand on heart I don’t know [what’s going to happen]” he said. “If I could answer that I’d be rich and famous!”

It’s the most uncertain moment in British politics since World War Two and what’s striking is that, two years on from the referendum, nothing has been decided.

A key reason for such uncertainty is the nature of the referendum itself.  As Anand explained, the referendum packaged so many different options and outcomes into a binary choice: leave or remain.  No one understood quite what they were signing up for and since the result, Brexit has largely been defined in terms of the different adjectives applied to it; black Brexit; white Brexit; hard Brexit; soft Brexit; white red and blue Brexit… the list goes on.

“Brexit was a vote against globalisation and it was a vote against the economic status quo. Subsequently, it’s interesting  to see that the South of England has noticed the North and we’ve had a chance to address issues that never got air time under old centrist, liberal politics.

“More profoundly, the referendum and its outcome have taught us about us. In the same way that Trump has been a wakeup call for the U.S, the fallout from Brexit should be a wakeup call to our politicians to think about the real problems confronting the country. ”

And how to best to manage negotiations as we ready to leave the EU.

Does the UK want to establish a relationship with the EU similar to that of Norway’s or maybe more like a more distant partner?

Anand admitted that due to Brexit being such a complex and all-consuming process, there is no avoiding it being a messy one at that! What happens during the next couple of years will largely be determined by the following three political factors:

  1. Theresa May

The UK Prime Minister relatively quickly defined what she meant by Brexit (leave customs market, end free movement etc) and her position has remained relatively unchanged since. Whilst she is unpopular with many in her party, it is unlikely her critics will choose to get rid of her yet. As long as she in place, she is a powerful force for stability.

  1. The Conservative Government

There are a significant number of Tory MPs who want a much softer Brexit than the Prime Minister is proposing so it’s possible they will vote against May’s Brexit deal. However, if May loses this vote there is no question that she has to go; after all, her whole mission as Prime Minister is Brexit. If that happens, the Conservative Party will either elect a new leader or the UK will face a new general election. And the one thing no Tories want is another general election.

  1. The Labour Government 

In the last general election, Labour picked up votes from both remainers and leavers. As such, the party have been careful to keep their Brexit policies ambiguous. Whenever Corbyn speaks about Brexit, he speaks in ambiguities.

Does Anand believe there is any chance of a second referendum? “The beauty of Britain at the moment is that any outcome is possible – I can imagine us crashing out with no deal or a great deal but I can also imagine a scenario where the first referendum is overturned.”

“No one knows what would happen to public opinion at this point – we could vote Brexit again. Or, imagine second time around the UK votes to remain 52-48 per cent. We’ll find ourselves in a political groundhog day. There would need to be a huge swing in vote for it to carry much weight.”

Ultimately, Anand warns, the real danger for the UK’s economy is that the negotiations go pear shaped, the UK crashes out of the EU in March 2019 and they end up with no wiggle room to extend the UK’s transition period.

His advice to procurement organisations trying to prepare? Plan for a World Trade Organisation outcome from 2021 – “That, I think, is the most likely outcome.”

A Shark at the 2018 Asia-Pacific CPO Forum

Shark Tank star, entrepreneur and talent expert Andrew Banks presented at the 2018 CPO Forum as a guest of our Premium Sponsor, American Express. Here are the highlights for this top-rated speaker.

There’s no single, agreed-upon definition of what leads to career success. If you pose the question on Google, you’ll find opinions ranging from salary levels, to happiness, to work-life balance, to growth opportunities.

It was refreshing, then, when Andrew Banks stood on the stage at the 2018 CPO Forum and announced that he had discovered the following formula: career success lies at the sweet spot between:

  • what you are passionate about
  • what you are good at, and
  • what the world

Banks is a modern-day polymath who might have delivered a fascinating speech on any number of topics, but knowing that he had over 60 CPO-level delegates in the room, he chose to speak about leadership and talent. Drawing upon his experience as a co-founder of Morgan & Banks, he spoke about motivation, attributes, values and purpose, and the winning combination when hiring talent. 

Motivation

“Intrinsic motivation is desirable, but extrinsic motivation helps direction”, says Banks. His point is that although a self-driven professional is admirable, a savvy leader will tap into their teams’ innate competitiveness and desire for rewards. He recommends driving performance and out-of-the-box thinking by:

  • creating competitions and prizes for teams and company-wide goals
  • making the rewards special (outside of normal rewards that are a part of the job)
  • making it open to all (anyone can play!)
  • setting specific targets and timelines to drive a sense of excitement and urgency.

Attributes Beat Skills and Knowledge

Banks is a strong believer in the power of psychometric testing and its ability to predict future job performance. Psychometric tests soon became a key differentiator for Morgan & Banks, with candidates tested across areas as diverse as cognitive ability, personality, interests, and attitudes. His message is similar to that of U.S. media figure Arianna Huffington, who tells businesses that no matter how brilliant an employee may be, the company should no longer tolerate “brilliant jerks” in the workplace.

Cultural Leadership

Banks quoted Peter Drucker’s famous observation that “Culture eats strategy for breakfast” before delving into an explanation of what cultural leadership looks like. It involves:

  • a constant rally around a ‘noble purpose’ – remembering that part of Bank’s definition of career success is “what the world needs”
  • highlighting core values daily/weekly.
  • being interested in your team, not interesting
  • providing inspiration and expecting the best.

The Winning Combination When Hiring Great Talent

If you can find a candidate with the combination of both passion and ability, you’re onto a winner. Banks comments that in job interviews, there are ways to ascertain what people want, opposed to what they think they want. Get them to explain the why within questions such as “What’s the best job you’ve ever had?”, and “Where do you excel?”

Similarly, when you’re writing a job description, always describe the behaviours and qualities you seek, not the role – just as you would describe the driver, not the car.

According to Banks, an ideal team member understands the business model and displays curiosity, thinks for themselves and innovates naturally, gets on well and never settles, has extra capacity for the next challenge, and makes their boss’s life easier.

In summary, if a leader is able to:

  • keep yourself refreshed by staying curious, seeking new input and inspiring the team,
  • motivate with games and rewards for out-of-the-box thinking,
  • get the team culture right around noble purpose and values,
  • start with the right raw materials …

…you’ll get superior performance!

Visit Chief Future Officer for more thought-leadership from The Faculty CPO Forum Premium Partner, American Express.

7 Procurious Influencers Who Are Smashing Modern Slavery

Not all heroes wear capes! But surely there are few people more deserving of a superhero’s recognition than the procurement pros fighting against modern slavery day in, day out….?

Last week, a heavy-hitting list of 100 modern-day abolitionists was splashed across social media following the 2018 Annual UK Top 100 Corporate Modern Slavery Influencers’ Index Recognition Dinner in London – and the team at Procurious was delighted to see at least seven Procurious members featured in the Index.

Developed by BRE and Sustain Worldwide, the #Top100Index recognises individuals from all business sectors, media and academia who are influential leaders in raising awareness to end modern slavery and labour exploitation; those who advocate for robust ethical sourcing and human rights recognition and practices in UK direct business operations and global supply chains.

The Index was based on a combination of influence on social media (as measured by Klout scores) and advocacy – policy impact, speaking and media engagements – in public life, aggregated via a proprietary algorithm and verified by an independent panel.

Influence is the key word here. While only a few of the Top 100 would be physically involved in busting modern-day slavery at the coalface, this group is arguably making a greater impact through addressing the source of the problem by raising public awareness and getting cut-through with he decision-makers in government and business who can really make a difference.

Procurement and supply management is well-represented in the Top 100, even though the scope of the award went well beyond this profession. This proves, once again, that any efforts to eradicate modern slavery must involve – and often be spearheaded by – procurement and supply professionals.   

Who are the Procurious members in the #Top100Index?

Congratulations to the following members of our online community. Connect with these highly influential professionals here on Procurious by following the links below.

  1. Andrew Wallis OBE of UnSeenUK
  2. Andy Davies of Greater London Authority (GLA) Group
  3. Dax Lovegrove of Swarovski
  4. Katie Jacobs of Supply Management
  5. Professor Jacqueline Glass of Loughborough University
  6. Rob Knott of Virtualstock
  7. Olinga Ta’eed, Entrepreneur

More from Olinga Ta’eed on Procurious:

In other news this week:

Deadline Passes with no renegotiated NAFTA

  • Parties to the NAFTA renegotiations have failed to reach a deal before the Congressional deadline of May 17 passed last week.
  • The deadline was in place due to the upcoming Mexican presidential election, which may introduce a new set of variables depending on the winner’s stance on trade.
  • US House Speaker Paul Ryan has said Congress is willing to vote on a deal within a few weeks, but commentators predict the negotiations are likely to drag on into next year.

Read more: https://www.supplychaindive.com/news/NAFTA-May-17-deadline-talks-extend/523811/

Gig economy in the spotlight

  • New research has revealed the explosive growth of the gig economy in the UK since 2010, with ‘non-employer businesses’ (businesses that only hire on a gig-by-gig basis) growing by 8,431% in the transportation and storage sector, and 1,464% in the accommodation and food service sector.
  • The number of self-employed people in the UK has risen by 41% since 2001, with 15% of the UK labour force classed as self-employed last year. The private sector has seen a 25% increase in non-employer businesses since 2010.
  • Recommendations from the Taylor Review of the gig economy include ensuring a balance between worker’s rights and those that are self-employed, sectoral strategies to ensure people do not face insecurity, and stronger incentives for firms to treat “dependent contractors” fairly.

Read more: https://www.premierline.co.uk/knowledge-centre/the-gig-economy.html

US-China Trade War “On Hold”

  • China and the US have agreed to drop tariff threats while working on a wider trade agreement, according to US Treasury Secretary Steven Mnuchin.
  • Washington has demanded that China narrows the $US335 billion annual US goods and services trade deficit and has proposed tariffs of $US50 billion on Chinese goods. China responded with its own measures targeting US agriculture.
  • The two economies have reportedly agreed to set up a framework for addressing trade imbalances in the future.

Read more: Washington Post