Tag Archives: social procurement

Big Ideas Summit 2016: Big Idea #30 – Buy Social Challenge

Supply chains need to be transparent, and also more socially and environmentally sustainable. That’s why we’re challenging professionals to ‘Buy Social’.

At the Big Ideas Summit 2016, we challenged our thought leaders to share their Big Ideas for the future of procurement.

From ideas that have the potential to change the very nature of the procurement profession, to ones that got the assembled minds thinking about the profession’s impact outside of the organisation, the response we received was amazing.

Buy Better, Buy Social

Peter Holbrook, CEO of Social Enterprise UK, introduced the assembled professionals to the ‘Buy Social Challenge’. The aim of the Challenge is to grow £1 billion of spend in the UK with social enterprises.

Peter argues that procurement needs to make supply chains much more transparent, as well as more socially and environmentally sustainable. By working with social enterprises, they can both do well, and do good, at the same time.

Catch up with all the delegates’ Big Ideas from the 2016 Summit at the Procurious Learning Hub.

Want to find out more about Big Ideas 2016? And maybe what we have planned for 2017? You can visit our dedicated website!

If you like this (and you haven’t done so already) join Procurious for free today. Get connected with over 18,500 like-minded procurement professionals from across the world.

How Sustainability Can Help Procurement Avoid Black Swans

Swans, procurement and sustainability – what’s the link? It’s all to do with procurement taking account for its impact on the wider world.

Seven Swans Swimming

The traditional 12 days of Christmas might not start until the 26th of December. But this festive season, we’ll be bringing you the 12 days of procurement Christmas in the run up to the big day. Catch up with the story so far on the Procurious Blog.

“On the seventh day of Christmas, my true love gave to me…seven swans-a-swimming.”

Black swans are always unexpected, and defy explanation. Seeing two black swans together is highly unlikely. However, seeing seven together all at once? Well, you better hope that you don’t.

Of course, I’m not talking about the bird that you might see in your local park. The Black Swan I’m thinking of is a term coined by Nassim Nicholas Taleb for an event that is both surprising, and has a major impact.

So, if we can’t predict when these events will happen, how can we stop them? This is where sustainability, social value, and procurement come in.

Thinking the Unthinkable

Earlier this year, Nik Gowing spoke extensively about the concept of ‘Thinking the Unthinkable‘ at the Big Ideas Summit. The idea behind this was that current leaders weren’t able to deal with cataclysmic events – either through a lack of skills, or outright denial.

Little did Nik know that when he used President Trump as an example of an unpredictable event, he was actually predicting the future! Nor could he have known that 2016 could provide even greater volatility than 2014, the year Nik and his co-author looked at for these so-called Black Swans.

It’s easy to argue that, without the right skills, these events are impossible to handle. If you then add in the fact that we can’t predict them, even with all the technology available to us, then what can we do?

Swimming with the Swans

Given that Black Swan events can be just about anything, procurement needs to look at its impact on everything to do its bit. And one way to do this, is to be conscious of its impact on the wider society.

Sustainability and sustainable procurement are concepts that are getting increasing focus in the global profession. Organisations have begun to realise that sustainability can build supply chain competitive advantage. Employee engagement is key, but the vast majority of people want to engage if it means a brighter future.

The environment is certainly a major consideration in potential future Black Swan events. And, from management of resources, to responsibility for global supply chains, procurement will play a major role.

Procurement Gets Social

Of course, sustainability is just one aspect of procurement’s future. The profession is taking increasing interest in social value, and working with social enterprises.

And why should procurement be working with these organisations? Well, they give back to the community, and have a positive impact on the community, and the environment. There are also social organisations working hard to ensure that people have proper access to good, healthy food.

And those of us looking to get more meaning in our procurement careers could do worse than looking to work with social enterprises. Career Coach Charlie Wigglesworth, Director of Business and Enterprise, Social Enterprise UK, discussed this at length earlier in the year.

If your conscience has been pricked, then there is plenty you can do to help. If we pull together as a profession, then we can ensure procurement is better equipped to deal with unexpected events.

Or, you never know, we might even be able to stop them happening in the first place. Then the only swans we need to think about would be the ones we see at the local pond. And that would be good for the future, wouldn’t it?

Negotiation – it’s just one of the key skills procurement professionals need to drive value. But do you go for milking your supplier? Or getting something from the wider herd? Get the lowdown on Day 8.

Advancing the Social Value Cause

How can procurement help to advance the social value cause? Our thought leaders in the first Big Ideas panel tell us how.

social value cause

In the first panel of the day, our delegates grilled our social value and sustainable procurement experts on how procurement can advance the social value cause, and help to bust some myths around social enterprises.

Timo Worrall, Senior Category Manager FM EMEA, introduced the work that Johnson & Johnson are doing with their Social Value through Procurement. The organisation is aiming to spend 3 per cent of its total spend in the UK with social enterprises by 2020, as well as creating 150 jobs for people who are furthest from the job market today.

Peter Holbrook, CEO of Social Enterprise UK, talked more about his organisation’s announcement of the ‘Buy Social Corporate Challenge’. 10 major global organisations, including RBS, Santander and J&J, will commit to spending £1 billion social enterprises by 2020.

Lucy Siegle, journalist and broadcast, expanded on her keynote around the true cost of supply chains, and how we can change our consumer behaviour to help make greater, global change.

  • Do we think there is a shifting social attitude for social and sustainable procurement? – Tom Derry, ISM

Timo – Don’t assume that businesses aren’t interested in social value. We’re not involved to sell more products, it’s more about how we choose as an organisation to engage with our customers. The social value cause is larger than just a single programme, it’s part of a greater movement. I just hope that in 10 years we’re not talking about this as something new, but how we are all spending our money with social enterprises.

Peter – There is a new generation of products that people are getting involved with. I have a Fairphone – it’s the first smartphone in the world that is free from conflict minerals. It has a better spec than the iPhone, and it’s also half the price. The social value cause will also help organisations with recruitment and retention. Companies are realising that they need to make commitments, and make CSR part of their DNA, or millennials will go somewhere else to work.

Lucy – There is some aspirational research out there. Environmental and social value isn’t far off the idea of social consumers, but now there is more willingness to engage with brands. Companies can’t second guess the consumer wants, they need to be authentic and decide on their own values.

  • In the procurement world, measurement is based on cost reduction. Social value is not incentivised in corporate procurement – are companies changing their measurements to account for social value? – Gabe Perez, Coupa

Timo – Procurement are second guessing their corporate stakeholders, and what their stakeholders want. We have much more engagement around social enterprises at J&J, and are opening up new conversations with business stakeholders. Cost is still paramount, but we’re conscious that there still needs to be social value.

Peter – There is a rapidly growing industry around integrated reporting, particularly in the accountancy profession. They realise that this reporting will have voluntary or mandatory adoption in the coming years. Public procurement is beginning to adopt the social value cause. If we can encourage public procurement to take this on, then we can change practices in the rest of the organisations around the world. The change just needs to be faster.

Lucy – We all have our parts to play. Taking something like how stock is traded, how do people have the time to understand the wider impact of the businesses involved in the trades, when everything happens in under 10 seconds.

  • We work for a fundamentally corrupt profession. When we look at procurement across the globe, 30-40% of spend is lost through fraud and corruption. Where do you see the agenda going from fraud and corruption, to the social value agenda? – Chris Browne, The World Bank

Peter – There is a Social Value Innovation Unit at the World Bank, just so you know! One component of the change is transparency –  businesses need to be rewarded for transparency, for airing their dirty linen, as well as the glossy CSR agenda. The fraud economy is bringing together an alliance of organisations, all of whom want to get transparency into supply chains. We’re not moving fast enough though.

Fortune will favour the bold and the brave in this – you will attract the best talent, and win more business by leading this agenda.

  • There is a myth to bust that social enterprises cost more. How can we bust this? – Helen Mackenzie

Peter – Evidence has demonstrated that social enterprises out-innovate private sector, and are cheaper than them too, in 52 per cent of cases. The social value products are using materials that would have otherwise been discarded. Even my underwear is made by a social enterprise (Pants to Poverty)!

  • What Big Ideas are there to introduce authenticity and accountability into the social value process? Alex Kleiner, Coupa 

Timo – We use accreditation from the experts at Social Enterprise UK. You shouldn’t let it become a barrier to working with social enterprises – the story is much stronger than this.

Peter – Transparency, transparency, transparency is the key, we have to build it into the process. This is a road and journey that will be filled with challenges, but the future depends on it. Procurement are the new superheroes in this – they are the people who can deliver the sustainable procurement goals, and bring redundant materials into the supply chain.

Lucy – There will be mis-steps along the way. There needs to be more of a holistic view, right throughout the the supply chain. There is a lot more communication in the brand and the supply chain now.

Certainly an enlightening panel, with some very thought-provoking thinking from our experts (as well as finding out what kind of underwear our leaders wear…). Stay tuned for more from our experts, and more panel discussions, as the Big Ideas Summit 2016 progresses.

Big Ideas in Social and Sustainable Procurement

Considered by many to be the next key frontier for business, Social and Sustainable Procurement are finally getting the attention they deserve.

Sustainable Procurement

Ahead of the Big Ideas Summit 2016 on April 21st, we are taking a look at the key issues facing procurement in the coming years. We have asked experts and influencers in our community to share their Big Ideas on the themes we will be discussing on the day.

Here, our experts and influencers share their thoughts on the Big Ideas impacting organisations in the fields of social and sustainable procurement.

Matt Perfect, Founder of Something Great – “Impact Spending and Social Impact Measurement”

Big Ideas in Sustainable Procurement - Matthew PerfectI believe “Impact Spending” is the next frontier for defining ‘value’ in procurement. That is, spending on goods and services with the intention to generate a measurable, beneficial social or environmental impact, alongside economic benefits.

Some might say that the history of procurement can be traced by our broadening definition of value. In the old days, our decisions were mostly price-based with little regard for ‘value’ at all. The evolution of strategic procurement brought with it a greater understanding of the importance of quality and service and the ‘value for money’ equation was born. Increasingly, risk and innovation have been added to the mix, and evaluation models such as Total Cost of Ownership have become much more sophisticated.

It is becoming increasingly apparent (both in theory and in practice) that organisations can no longer separate their profitability and growth, from the impact their activities have in society. As such, procurement and supply professionals must be able to account for, and measure, the impact of their spending.

There is much the profession can learn from the emerging field of social impact measurement. By incorporating such measures as Social Return on Investment and Theory of Change into spending decisions, we will unlock the next wave of procurement value for our businesses.

Charlotte Spencer-Smith, Marketing at POOL4TOOL

Big Ideas in Sustainable Procurement - Charlotte Spencer-SmithRegulatory pressure on companies to report on CSR criteria in supply chain is increasing – the UK Modern Slavery Act and the Dodds-Frank Act in the US are recent examples. ISO/DIS 20400, currently under development, will provide clearer guidance about what is expected from organisations wanting to implement sustainable procurement.

Improved supply chain transparency will put pressure on procurement organisations to build category-specific strategies and make sourcing decisions with sustainability in mind. Criteria, such as sustainability and labour ethics, will be increasingly included alongside financial and risk data as factors that go into processes like supplier management, sourcing, and contract management.

Extended information and third party content, specialising in sustainability data for supply chains and procurement organisations, are on the rise. But it will soon be indispensable to have this information deeply integrated into people, process, and technology to make CSR-positive sourcing decisions as easy as possible.

It’s a crucial part of the wider picture of value-based sourcing: developing sourcing decisions beyond the purchase price.

Jordan Holzmann, Founder and CEO at Cruxcee

Big Ideas in Sustainable Procurement - Jordan HolzmannIn terms of the now, we are seeing procurement take an interest in what role they play in sustainability. Procurement is realising that they can make a huge impact in the way they source through the supply chain.

This is exciting to procurement professionals as their job now has a new lease on life, and they aren’t just feeling like they are saving money and going through the process of buying stuff. This will shape the procurement profession in the future too, as it becomes more strategic in achieving sustainability goals for the organisation.

In terms of the future, I see the concept of finite resources impacting the way we procure products. Concepts like cradle to cradle and circular economy are driving innovation through material use. Procurement will have to be more innovative than ever as the world shifts to more sustainable materials.

They must be on the lookout for sourcing decisions that make use of alternative resources, reduce waste and reclaim any unused materials. This also goes for materials that are toxic and do harm. Procurement must work to avoid these, and find materials that do not harm the environment.

Do you work in social or sustainable procurement? What are your Big Ideas in this area? Let us know and we could be discussing them on April 21st.

Want to know more about Big Ideas 2016? Then visit www.bigideassummit.com, join our Procurious group, and Tweet your thoughts and Big Ideas to us using #BigIdeas2016.

Don’t miss out on this truly excellent event and the chance to participate in discussions that will shape the future of the procurement profession. Get Involved, register today.