Category Archives: Procurement News

Want to Know Where Your Clothes Came From? There’s an App for That!

A new app, developed in Australia, hopes to give consumers the information they want on the supply chains producing their clothing.

We’ve covered ethical fashion in great detail on Procurious in the past. Most of our coverage has focussed on the public’s desire for cheap, rapidly produced garments or ‘fast fashion’ as its been dubbed.

This business model has had a huge impact on the supply chains of leading retailers, as they push to make the latest fashions available quicker and for a lower price. Many have resorted to shifting production to the developing world in a bid to reap the benefits of low cost production as a means to keep price down and maintain margins.

As these practice have become public, many firms have been accused of scrimping on safety and ignoring labour and environmental concerns in the their supply chains, and have faced harsh criticism as a result.

The Turning Tide

While this fast fashion business model has dictated the retail garment industry for the best part of a decade now, it appears that the tide is starting to turn. Many consumers are now prioritising the ethical footprint of their purchasing, just as much as cost and style.

Companies like Patagonia (who we’ve written about before) and KowTow have started appealing directly to consumers’ better judgement by creating a business model that focuses on sustainability first.

Even H&M, long condemned for its questionable supply chain practices has released a ‘conscious collection’ of sustainably produced garments. However, many have accused the firm of ‘green washing’ as, although it is producing a small amount of clothing sustainably, the vast majority of the company’s range still follows the fast fashion model.

There’s an App for That

Regardless of motive, this shift in consumer psyche has spawned a new app called ‘Good On You’. Developed in Australia, the app gives shoppers the ability to understand the ethical impact of the clothes they are buying, directly through their smart phone.

The app analyses clothing ranges based on the three broad categories – environmental, labour and treatment of animals – before creating a final rank for that brand.

‘Good On You’ doesn’t currently carry out its own auditing, instead analysing firms’ current accreditations from organisations like Fair Trade, Ethical Clothing Australia and other non-governmental organisations.

The app aims to inform customers of brands’ practices and supply chains, and call out firms using sustainability as a marketing tool, particularly when they don’t have credentials to back it up.

Speaking on the opaque nature of sustainability marketing and supply chains, Co-Founder at ‘Good on You’, Gordon Renouf said; “We want brands to say exactly what they’re doing, to be transparent about the supply chains, to show where their factories are so other stakeholders and unions can check on them.”

Find out more about the company’s aim here and download the app before you next go shopping!

Making Your Department Sexy

Every functional department needs to find its rightful place in the business hierarchy. So what can you do to help it achieve the sexy status it deserves?

And before you even think of saying, “we’re doing a really good job – that is what people will notice!” – forget it. Of course you are doing a good job, but these days that is not enough. You have to show it too.

The first thing you need to do is strut your stuff, show your wares and make them want your services – find out what you are good at and market yourself.

Lose the Mission Statement

Rule number one – if you have a mission statement then throw it away – it has already fulfilled its purpose by getting you to think about what you do. It is useless to market yourselves. In fact it’s worse than useless because it often has a bad effect on others.

Put it this way – just how thrilled would you be if you got sent a copy of the Accounts Department mission statement? Would it lighten your burden? Would you think: “Ah! Now I at last can see their purpose in life I will for evermore integrate with them seamlessly”?

You need to work out what you’re good at – how you impact the wider community, what are the practical things you do for them, and why do you make their life better? Next you need an influence plan, and that should have named individuals on it representing no more than ten per cent of the company.

If you think a plan means putting a display board up in the canteen so everyone can see us –think again. It’s limp, unfocused and unprofessional. Your message is too important to let it dribble out to people who are grazing, rather than go-getting.

Craft Your Message

If you need some help in formatting this idea then why not ask your own marketing department? Perhaps you buy some marketing and creative services in – you may even get it for free if you sell it as part of the process of ‘getting to know you better’.

Take your ten per cent target and use your carefully crafted marketing material with laser like accuracy to get up close and personal. If you make it important then so will your target audience. This is line fishing for powerful marlin, not drift netting for common herrings.

Get the Right People

So you‘ve got yourself a good story – but do you have the people to back it up? Is your group bursting with talent that is the envy of the rest of the organisation? If not then you need to something about it. The simplest tool of all is often overlooked – go find the best people and ask them to join you. Top talent is always interested in self-development. They often have the ability to persuade their own management to let them do things. Best of all they are usually a bit vain and easily flattered.

This doesn’t have to get tangled up in job specs and grade issues. Perhaps they could have some relevant work experience for a short while, or work on a joint project with you. If you can get some fresh blood into the camp, it can have a rejuvenating effect on the whole team. Start looking at the way your team does things. What impact do your people have? Not just from the point of view of their skills.

This sort of profile-raising is not going to be without its side effects, which are worth heading off early if possible. Firstly when you tell people what you can do for them, you can expect the initial response to be a lengthy list of all the things you haven’t done well. This is great feedback – it may not feel like it at the time, but it’s gold dust. Remember, before you stimulated them into complaining, the problem was even worse because you didn’t know about it.

The Future

So where does the future lie for making your department the sexiest around?

The truth is that the skill and attractiveness of your players will make the difference. Does this mean you need only Brad Pitt and Angelina Jolie look-alikes in your group? Absolutely not. Lasting attractiveness has always been more to do with passion, knowledge and focus than surface looks. And the good news is these are things that can be taught, so everyone can be sexy if they want.

Can Re-Shoring Explain China’s Faltering Economy?

China’s economic slowdown is starting to send reverberations across global markets.

While it’s too soon to panic about Chinese growth figures, the engine behind the world’s economic growth for the last decade or so does seem to be spluttering a little, and this is a worrying sign for some market sectors.

Just what is causing this slowdown?

Many are attributing a slowdown in Chinese manufacturing levels as a key driver for the nation’s economic downturn. The numbers seem to back this up. The Chinese Purchasing Managers Index (PMI), a metric that measures economic activity based on the activity of procurement departments (learn more about this indicator here), hit a two-year low in July 2015, following a fifth consecutive month of contraction.

The significant drop in the PMI is usually in line with a decrease or slowdown of manufacturing in a country. A potential cause for this slowdown could be a preference from firms in the west to move operations away from China.

There seems to be two main drivers for this behaviour. The first is that ‘low-cost China’ isn’t so low cost any more. The second is an increasing preference for ‘re-shoring’ or ‘near shoring’.

When Low Cost Isn’t Low Cost

Firms that moved their operations to China between 10 and 20 years ago are finding that labour rates for Chinese workers are far more expensive than they once were. This is removing one of key motivators for both relocating operations to China in the first place, as well as maintaining these operations now.

It’s estimated that Chinese incomes are increasing by as much as 20 per cent year-on-year, a rate much higher than most of the rest of the world. Many foreign firms are now looking to other developing markets in Asia and Latin America, in order to take advantage of lower cost bases.

Reassurance in ‘Re-shoring’

The other practice driving a move away from Chinese manufacturing is ‘re-shoring’ or ‘near shoring’. This involves firms moving previously outsourced operations much closer to home.

David Simchi-Levi, a professor of engineering at MIT, suggests that this may be a key factor in China’s manufacturing slow down. He highlights a study carried out by MIT in 2012 that suggest 15.3 per cent of US firms were ‘definitely’ planning to move operations back closer to home and that 33.6 per cent of firms were ‘considering’ similar action.

To highlight acceleration in this area, Simchi-Levi points to a more recent study by AlixPartners that shows 32 per cent of firms are already re-shoring and 48 per cent of firms are in the process of doing so within the next three years.

Closer to Home

It seems that as Chinese wages continue to climb, organisations have less of a stomach for the other issues that have accompanied Chinese based production, such as questionable safety records, long lead times and high transportation costs in favour of options that are closer to home.

While a large number of firms have to ability to move production very quickly, clothing producers being one clear example, China has been able to build a significant domestic technology and hi-spec manufacturing industry that will mean firms with more technical specifications may find it harder to move away from their traditional Chinese production centres.

It will be interesting to see if the move from traditional manufacturing to a more technology-based economy will help to arrest the economic slowdown, and re-affirm China’s place as a powerhouse economy.

5 Tips for Using Data in Procurement

This is the century of data and every purchasing professional should be a data person to some degree. How you use data can enhance your career?

Here are five top tips to improve how you use data.

1. Source – Most organisations have spend data to analyse. Think about other sources of data – 80 per cent of stored data is estimated to be unstructured. Text analytics can give insight into supplier information on social media. Visualising social media data related to a supplier can give timely insights. Note that different parts of the world favour different social media sites, so make sure the countries where your suppliers operate are covered.

The timeliness of your source is also an important consideration. Real time data will allow you to monitor strategy implementations and allow the tweaking of plans to increase success. For example, monitoring maverick spend on a new contract means it can be quickly identified and reduced.

2. Focus – Don’t try and cover too much information in one presentation. Be concise and only include relevant information. Avoid unnecessary ‘chart junk’, the most important parts should demand the most attention. Data experts try and keep the data to ink ratio high. That way your message will be clearer and it will be more likely that your audience will remember it.

3. Story telling – People love and remember stories so include one around your data to make it captivating. You can use a narrative based around time or geography. Add human interest as this engages your audience emotionally.

For example, if you are presenting data on the success of a supplier relationship management programme, you can narrate you presentation around how the programme has developed over time and include anecdotes from individual stakeholders that highlight an aspect of the programme.

Don’t forget that the title can be used to tell the story. For example: ‘Supplier Relationship Management Data vs Improving Supplier Relationships’. The latter will instantly tell the audience what to expect.

4. Visualisation – People are programmed to understand patterns, so graphs are more instantly understandable than numbers. Use appropriate colours. You want colour to emphasise your message not detract from it. Layout the data out with the audience in mind and chose a chart that tell the story you want to tell.

Good design improves user engagement. My key bugbear is pie charts. While they look pretty, people find it hard to compare areas. Length is easy to compare so in general, bar charts are more useful than pie charts for comparisons.

5. Analysis – Use trend analysis to show patterns and to predict or forecast the future. Those that know the data will ask the best questions and be best placed to analyse it, rather than using a specialist analyst.

Access to self-service analysis tools makes this possible. Use this analysis to show your knowledge of the situation and form conclusions that will inform decision making in your organisation.

So get out there and enhance you career and improve procurement by using data effectively.

Juliet Frost is the P2P Business Analyst at the University of Oxford and a procurement and big data expert.

From the Backroom to the Boardroom

The rise of the Chief Supply Chain Management Officer

Global directional level corporate and policy decision making corridors are going through unprecedented changes. These dramatic shifts have been largely influenced by the increasing importance boardroom executives attach to supply chain management.

Today, the skills and knowledge of supply chain management professionals are increasingly being utilised, with forward-thinking executives and policy makers now officially accepting the chief supply chain management officer as a member of the C-Suite.

Drawing on a sample of international organisations, including Fortune 1000, FSTE 250, JSE 100 companies, and public sector organisations with a combined revenue or spend of well over a trillion USD, the study by Professor Douglas Boateng[1] examined director perceptivities on the strategic importance of supply chain management and, in particular, the increasing boardroom role of the chief supply chain management officer.

C-suite executives that took part in the longitudinal study included CEO’s, CFO’s, COO’s, directors, and officers from manufacturing and production, mining and recourses, food and beverage, government, agriculture, logistics and public sector organisations.

The Chief Supply Chain Management Officer

The chief supply chain management officer, who often takes responsibility of functions such as procurement, logistics, customer service, and operations, is known to possess the tools needed to innovatively lead value-driven initiatives across such functions, as well as within business units and across broader value chains.

With such sought after skills, it is not surprising that 48 per cent of the above-mentioned research study’s respondents agreed that the chief supply chain management officer will become a standard C-Suite role within ten years.

According to the study, well-crafted supply chain management strategies are considered to be most critical for, among other things, long-term wealth creation, small business development, government service delivery quality, industrialisation, national economic development and job creation.

In terms of wealth creation, 70 per cent of the global executives that participated in the study saw supply chain management and procurement as aspects that they considered to be crucial for long-term wealth creation.

In addition to this, 64 per cent and 66 per cent of the executives agreed that supply chain management and associated procurement aspects has a direct impact on small business development and job creation.

This emerges as particularly significant when compared to the percentages received for perception of logistics’ and finance’s impact on small business development, which came in at 6 per cent and 12 per cent respectively.

Growing Recognition of Supply Chain

In relation to complex supply chains, such as government, where service delivery quality is critical for value creation, 34 per cent of global respondents viewed the supply chain management function as essential to the success of quality service delivery. This is an increase of 19 per cent over a four year period.

This significant increase highlights a growing recognition that the supply chain should no longer be viewed in terms of ‘cost of ownership,’ but should rather be regarded in terms of its overall impact on business and society.

Such support of the role of supply chain management in the successful realisation of public sector services and initiatives can further be seen in various governments’ active use of supply chain management to not only improve public sector governance and delivery, but also to add more value to resources, stimulate SMME growth, and create sustainable jobs.

In terms of the C-suite executive having the dual responsibility of directing acquisitions and payments, 86 per cent of the global executives saw this as creating ethical and conflict of interest challenges. Although there seems to be a general consensus, the 14 per cent increase over a four year period clearly indicates that there are concerns among the C-suite members.

Finally, when it comes to the impact of supply chain management on industrialisation and national economic development, the study found that 68 per cent of global executives supported supply chain management and procurement as having direct impact on industrialisation and national economic development.

Transformation of the C-Suite

Based on these statistics it is evident that supply chain management has emerged as a prominent topic on both public and private organisations strategic agendas, and dramatic shifts in director level perceptions relating to the role of the chief supply chain management officer in organisational decision making, is leading to the transformation of the C-Suite.

Additionally, a clear recognition by director-level executives of the increasingly important role that supply chain management occupies in the overall organisational environment, highlights the growing influence that the chief supply chain management officer will come to exert in the boardroom and policy making corridors.

The findings clearly support Groysberg, Kelly and Macdonald changing C-suite assertions in the Harvard Business Review in March 2011[2].

Professor Douglas Boateng is an International Professional Director and an Adjunct academic; a Fellow of the UK Institute of Directors; Africa’s 1st ever appointed Professor Extraordinarius for Supply and Value Chain Management; and CEO of PanAvest International and Partners.

Professor Boateng has been publicly acknowledged by the Commonwealth Business Council for contribution to international supply chain management and emerging world long term economic development. 

[1] Boateng, D., (2015) Gauging director level perceptivities on aspects of supply chain management- A global longitudinal study

[2] Groysberg, B., Kelly, K. and Macdonald, B., (2011). The new path to the C-Suite. Harvard Business Review March

‘Rethink Supply Chains’ – The Innovation Challenge to Fight Labour Trafficking

The Partnership for Freedom launched its ‘Rethink Supply Chains‘ competition last week, aimed at providing a technological solution to help fight labour trafficking in global supply chains.

In International Labour Organisation (ILO) estimates that there are 14.2 million people around the world who are victims of forced labour in industries such as agriculture, construction and manufacturing.

The goods and service provided through these industries are often purchased or used by consumers who are none the wiser, thanks to a lack of transparency in supply chains.

Formed in 2012, the Partnership for Freedom is an American-based public-private partnership, which brings together organisations and governmental departments such as the Department of Justice, the Department of Labor and Steven Spielberg’s ‘Righteous Persons Foundation‘.

The Partnership challenges individuals and organisations to create innovative solutions to human trafficking challenges. In 2013, it launched its first Challenge, “Reimagine”, and granted $1.17 million to fund two winning innovative models, aimed at improving the infrastructure of support for survivors of modern slavery in the United States.

Challenge Two – Rethink

Now, Humanity United, the organisation leading The Partnership for Freedom, has announced the second challenge in its set of three – Rethink Supply Chains.

With a fund of $500,000 for winning solutions, Rethink Supply Chains seeks new ideas, tools, and efforts that use technology to combat and prevent labour trafficking in global supply chains.

The challenge encourages developers, designers, advocates, and innovators to focus on one or more of the following areas:

  • Workers’ Voices: Tools that help workers to share information and foster community, access resources, and report labor violations to businesses, governments, NGOs, or each other in the most safe and secure ways possible.
  • Recruitment: Tools to improve the transparency and accountability of the labor recruitment process, encourage responsible practices for employers and recruiters, and empower workers to more safely navigate the recruitment process.
  • Traceability: Technologies that enable businesses, workers, governments, and NGOs to track, map, and/or share information on commodities, products, and labor conditions in supply chains at high risk of forced labor.

Eliminating Human Trafficking

Randy Newcomb, President and CEO of Humanity United, stated, “The scope of this issue is enormous. We need new actors, new skills, new data, new ideas and new energy to improve anti-trafficking efforts around the world.”

This was also emphasised by Ambassador Susan Coppedge of the U.S. Department of State’s Office to Monitor and Combat Trafficking in Persons, who said, “Forced labor has no place in our global supply chains nor in the goods and services we buy every day.  We look forward to the innovative ideas and designs we anticipate from this Challenge as we seek to eliminate human trafficking from the global marketplace.”

How to Get Involved

All the details you need to know about the competition can be found here. The deadline for initial solution submission is the 13th of December, with finalists being announced during January 2016.

Entries can be submitted by individuals who are resident in the United States, or organisations with the United States as their primary location for business. Rules and Terms & Conditions can be found here.

If you can’t take part, you can support the campaign and follow the competition on social media, via Facebook and Twitter. Also stay tuned to Procurious, as we will publish the finalists next year and keep you all posted with the winning solutions.

If you are thinking about taking part, please let us know! We’d love to tell everyone your story and why you think your solution will help to end human trafficking and forced labour for good.

Stopping Redlining in its Tracks

How the new wave of contract management software is reducing time spent negotiating.

Is it possible to use data analytics and clause standards to make the contract negotiation process more efficient? Certainly there are situations where standard contracts are routinely used, and it’s undeniable that this saves time and money.  For example, imagine how much longer standard real-estate processes would take if each time an agreement had to be drafted by scratch.

However, there are also many situations where individual situations call for the drafting of a unique agreement.  Lawyers may argue that, by nature, the art of drafting contracts is so complex that it would be nearly impossible to use any form of analytics to assist in the process.  But the new wave of contract drafting and management software is seeking to defy that argument.

Kingsley Martin of KMStandards (publisher of ContractStandards) suggests there are three main metrics that define the success of a contract negotiation process.  All of these metrics overlap to some degree.  These are:

  1. Quality is defined by such things as how well it achieves its purpose, how much consideration it generates over time, its completeness and accuracy;
  2. Cost is the cost of the negotiation and administration including all expenses related to litigation and disputes; and
  3. Time spent on negotiations, administration of the contract including the time required to handle litigation or disputes.

track_changes

Newer technology is seeking to help optimise all three of these aspects of the contract management process by measuring metrics on contracts for various purposes.  An analysis of this data could lead a system to automatically produce contracts with optimised terms – i.e., the terms in the past that have required the least amount of time to negotiate.

It could even predict what agreement parties will arrive at for the sale or purchase of a product and/or service. This new technology will stop redlining in its tracks!

What are your thoughts? Do you believe that standard contract language can help reduce unnecessary negotiation? Can you think of any other ways technology could work towards optimising the contract management process?

ContractRoom, home of #HappyContracting – making the world more agreeable one happy contract at a time. Negotiate less, Agree More! Contact us for a free demo @ www.contractroom.com.

All for One, Innovation for None

Another public procurement price analysis article has made national headlines recently, found here on BBC News.

Many thanks to Market Dojo for giving Procurious permission to republish this article.

The Home Office conducted a study into police procurement trends across 20 common items including batons, uniforms and helmets.

I haven’t read the Home Office study in detail, but these kind of reports can err on the side of rudimentary:

Humberside bought police helmets for more than £43 each while most other forces acquired them for under £30.

This can indicate a savings potential and is undoubtedly a good place to start your evaluation for cost reduction opportunities.

However when you simply compare two purchase prices, rarely, if ever, does the analysis also delve into key contractual differences such as payment terms, rebates, catalogue pricing discounts, minimum order quantities, annual purchase volumes, inclusion of delivery costs, what delivery service levels, product warranties etc.

Then you have the question on whether the specifications are the same.  Perhaps Humberside has identified a more costly product that leads to a 20% better safety record from head injuries.  Might that not justify the additional cost?

There is a long perceived view that rationalisation and aggregation leads to cost reduction.  For example, in the same article Policing minister Mike Penning was quoted:

“For too long the police have approached the market in a fragmented way, buying equipment in small amounts and to varying specifications.

“It makes no sense for forces to buy separately when money can be saved if they act together.”

Bigger procurement is not always better procurement

Interestingly Spend Matters UK recently re-circulated an older post of theirs outling how bigger procurement is not always better procurement.  Please do have a read as it provides excellent insight that we won’t duplicate here.

What we’ve seen is that many of our clients run reverse auctions on aggregated volumes, rather than spot-purchases.  They are very successful in doing so.  That said, even very low value auctions of a few thousand pounds have lead to 30%+ savings, so bigger isn’t always better in our view too.

Large spend values attract large suppliers with the notion being procurement teams can exercise their leverage and use economies of scale to secure better pricing.

Lower spend values attract smaller suppliers and generally there are a lot more of them in the marketplace, which can equate to increased competition and better savings.

Perhaps the price differences seen with the police, assuming they are not associated with contractual or specification issues, are less to do with failure to aggregate demand and more to do with ineffective negotiations for their own requirements? 

One step forward, two steps back

One adverse side-effect to bundling up contracts into an aggregated demand is that it diminishes competition.

Taking say £200m of spend that is today fragmented across many hundreds of suppliers and bundling it into a single contract prohibits SMEs from retaining business.  As a result some may perish whilst others downsize.  The large company that wins the contract swells significantly to cope with the demand whilst other large businesses (if there are any) stay as they are or also downsize from losing their portion of the fragmented spend.

Fast forward a year and the market only has one real candidate who can cater for the demand – the incumbent.  This becomes a very poor market to negotiate in.

And so the cycle continues whereby it is decided to fragment the contract into smaller packages to increase competition, except this time there isn’t as much liquidity.  So we’re back where we started except with worse market conditions.

Innovation triumphs over imitation

As we’ve just noted, consolidated contracts diminish competition.  With less competition, there is less imperative to differentiate.  There will be fewer SMEs in the market and they are typically regarded as the key source of innovation with their agility and drive to increase market share.  Local police authorities will have their hands tied and won’t be able to engage with the SMEs and so those remaining will have little incentive to innovate.

Furthermore, the other suggested strategy in the BBC article was to standardise the products. This again reduces innovation, as the product spec. would be based on what already exists, not would could be.  Once that spec. is agreed, the market is closed out to new ideas.  This contradicts with the relatively recentreforms to the EU Procurement Directives.

So what should we do?  

We should be focusing on driving the market forward and negotiating effectively within that market.  A fragmented market can be your best friend, not your enemy.  Procure on best value, not just best price.  Don’t focus on Purchase Price Variance but on lifetime costs.  Improve through innovation.

We could go on but there’s a risk we’re sounding like a Baz Luhrmann song!

Hopefully we make ourselves clear but more importantly, what do you think about this suggested police procurement strategy?

Market Dojo is a pioneering software-as-a-service (SaaS) company that offers professional, intelligent and easy-to-use online negotiation software and accessible eSourcing software. Find out more at www.marketdojo.com.

How to change the world…like a procurement pro!

If you’re bored of cutting deals and meeting with the same old suppliers you might be starting to wonder, “what’s next?” 

Cherries/Shutterstock.com

This article was originally published on LinkedIn.

The good news is, as you’ll see in a moment, there’s a simple way to re-energise your procurement career. The even better news is, your boss will love it because you will be delivering tons of value for your organisation and making the world a better place.

If you haven’t already, it might be time to think about social procurement.

Social procurement has nothing to do with buying stuff on Facebook. (Having said that, I believe social media has a massive role to play in procurement so please, join me on Procurious to see why!)

No, social procurement is where social impact and procurement meet. By directing even a small portion of our organisation’s spend, towards social enterprises, we can make a real difference in the lives of marginalised groups such as the long-term unemployed.

According to Social Traders, a leader in the development of social procurement in Australia:

A social enterprise is an organisation that; is driven by a public or community cause, be it social, environmental, cultural or economic; derives most of their income from trade, not donations; uses the majority of their profits to work towards their social mission.

With social enterprises now operating in a vast array of industries from facilities maintenance and cleaning to printing and web design, it is no longer a question of if you will do business with them, but when. It is also easier than ever, with intermediaries like Social Traders providing valuable services that help bridge the gap between large government and private buyers and social enterprises.

So where to start? Most procurement professionals I know aren’t sitting around looking for something to do and social procurement can seem like that ‘nice-to-have’ project we just don’t have time for. In reality, many organisations are already doing social procurement. The opportunity for procurement professionals is to Find it, Flag it and Facilitate it.

Find it: Identify social enterprises in your spend and supply base

One of the most important roles for any procurement professional is providing useful intelligence to the organisation regarding its suppliers. Often this means analysing spend data and interpreting it to provide meaningful insights that inform better decision-making.

In the case of social procurement, simply being able to identify social enterprises, particularly within the long tail of vendors that characterises most spend profiles, can mean the difference between creating and destroying social value for your organisation. Again, intermediaries like Social Traders have large databases of social enterprises that can assist with this task.

Flag it: Promote the value of social enterprise suppliers

As leaders in the organisation, particularly when it comes to supplier relations, procurement professionals have to take a position on value. If all we talk about is savings, then that is all that will be expected of us. People will look elsewhere for other forms of value.

Social value is still a source of competitive advantage in many industries, but increasingly it is becoming an expected norm, by customers, employees and shareholders alike. Promoting the role of social enterprise suppliers and measuring social impact as part of our decision making, positions procurement professionals as key contributors to organisational strategy.

Facilitate it: Make it easier to do business with social enterprises

Sometimes the best thing a procurement professional can do for the organisation, is get out of the way! Particularly with smaller suppliers (which social enterprises often are) the role of the procurement professional is more ‘facilitator’ than ‘manager’.

The day to day operational relationship with the supplier likely sits elsewhere in the organisation, but the policies and process set by Procurement can either help or hinder these relationships. Rather than treating all spend outside of Procurement’s control as ‘leakage’ or ‘maverick spend’, acknowledge that social enterprise development is a strategic objective.

Providing policy exemptions or tweaking procurement processes to make it easier to do business with social enterprises, can promote social value with minimal resource effort from Procurement.

So, if you’re ready to start using your procurement super-powers for good, then I have an invitation for you. There’s no catch and it won’t cost you a cent.

Please join me at the upcoming launch of Social Traders Connect. It’s a great opportunity to find out more about social procurement, meet with social enterprises and hear from peers who are using procurement to create social value in their organisations.

But don’t stop there. If you have social procurement questions or experiences of your own that can help others, please share them via the comments below or reach out to me via Linkedin or Procurious for a confidential conversation.

Jamaica Invests in Procurement Capability

400 procurement professionals from the Jamaican public sector have undergone extensive training in procurement practices. Some of those involved in the initiative were sent as far away as Canada and the United Kingdom to receive their education.

The move comes as part of a concerted effort from the Jamaican government to transform its procurement operations and ultimately deliver a more effective and efficient public service.

Of the 400 people trained, 300 received instruction under a certification series delivered by the International Procurement Institute, 40 received training in procurement law from the Osgoode Hall Law School, York University, Canada, while another 60 people were trained in E-procurement by Crown Agents and European Dynamics in the United Kingdom.

Certification Critical for Reform

Malisa McGhie (Senior Procurement Analyst in the Procurement and Asset Policy Unit in the Ministry of Finance and Planning) discussed the training as critical for the ongoing development and success of procurement and the public service in Jamaica, claiming that the certification of procurement officers is a key component of the reform process.

“Procurement practitioners must also be trained in what the standards are and understand how to actually execute, those types of procurement, to meet international standards,” said McGhie.

Echoing discussions both here on Procurious and in the procurement media in general, Senior Director in the Procurement and Asset Policy Unit, Cecile Maragh, highlighted the importance in improving the profile of the procurement profession in Jamaica.

“We have to make sure that public procurement is seen as a profession and not a clerical function.  It is not just something that you receive specifications and go to tender. It requires analytical thinking, it requires market research, so persons undertaking this function must understand that public procurement is in fact, a profession, and it should be treated as such,” she said.

The Finance Ministry has committed to training a further 500 procurement professionals over the coming three years.