Tag Archives: social value

Is the era of the fence-sitting corporation over?

Corporate CEOs have historically remained silent on politically divisive issues to avoid a potential backlash from consumers and their own employees. Last week, this rule was turned on its head.

Three high-profile advisory councils were disbanded by U.S. President Donald Trump last week after a cascade of CEO resignations over his response to the Charlottesville “Unite the Right” rally.

Mr Trump dissolved the American Manufacturing Council and the Strategic and Policy Forum after it was leaked that the remaining members of the two councils were planning a press announcement on Wednesday 16th August about disbanding the groups. High-profile resignations up to that point included Kenneth Frazier (Merck CEO), Under Armour CEO Kevin Plank, Intel Chief Executive Brian Krzanich, ADL-CIO’s Richard Trumka and Thea Lee, the Alliance for American Manufacturing president Scott Paul, Campbell Soup’s Denise Morrison and 3M’s Inge Thulin.

A similar revolt in the President’s Committee on the Arts and Humanities took place two days later, with 16 out of the 17 members quitting, leading to the White House stating that the committee’s executive order would not be renewed.

Is the line between politics and business dissolving?

Michael Maslansky, the head of a language strategy firm that advises major companies, told the BBC last week that “the era of the fence-sitting corporation is over”.

In an unprecedented situation, the moral compass has now been placed in the hands of business leaders, who are coming under increasing pressure to comment on political events. Donald Trump’s tweet about “pressure on the businesspeople of the [councils]” gets this absolutely correct.

Many of the CEOs who resigned from the advisory councils made statements along the lines of having “no choice” about the matter. In other words, Trump’s response to Charlottesville put them in a situation where their connection with the president contradicted their company’s corporate positions on race, diversity and equality.

Even CEOs without a formal position on an advisory board, including Apple’s Tim Cook, spoke out in condemnation last week. In the past, it was seen as safer to remain silent, or risk the wrath of customers (and employees) from the other side of the political spectrum.

Why is this happening? “If you’re silent about an issue, then each side will assume you’re on the wrong side. You end up really having to choose”, says Maslansky. Another sentiment that was frequently expressed after Charlottesville was the idea that silence in the face of injustice (including racism) is tantamount to complicity.

Ideally, every company would have a Values Statement which would dictate the CEO’s response to any relevant issue. This means the “choice” doesn’t come down to the personal whim or leaning of any individual business leader.

Where will this end? With political divisions only increasing, will we see consumers do business only with companies that reflect their political views? This is already happening on the fringes, with regular calls going out from both sides to boycott various companies (think #DeleteUber, or #AnywherebutTarget). Terms for this include “dollar voting”, “ethical consumerism” and “moral boycotting”.

For procurement and supply managers, daily buying decisions could become so fraught with larger implications that it will become hard to keep track. But if the end customer expects organisations to make purchasing decisions that are in line with their own values, this is certainly a space to watch.

As for CEOs, the era of carefully-worded, politically-neutral statements may be over. When a new CEO steps into a role, their customers, their employees and the Board will want to know where they stand politically and how this will influence the corporate culture.

To quote a meme that’s currently doing the rounds on social media: sitting on the fence only gets you one thing: splinters.

The vanishing line between business and politics will be one of the topics under discussion at the Chicago Big Ideas Summit on Thursday 28th September. If you’re a CPO and located in or near the Chicago area, there are still some seats available (limited to 50 attendees). If you’re not quite CPO-level (yet) or based on the other side of the globe, don’t worry – we’ve got you covered. Simply register for free as a digital delegate on Procurious, and we’ll bring all the Big Ideas from Chicago to you! Click here to find out more.


 In other news this week:

Australia to develop anti-slavery legislation

  • Australia’s Turnbull government will soon require companies with an annual turnover of at least $100 million to publish “Modern Slavery Statements” on a publicly accessible central repository.
  • The statements will include measures companies are taking in their supply chains to combat modern slavery, including human trafficking, debt bondage and forced labour.
  • The government is also considering drafting a Modern Slavery Act and an independent anti-slavery watchdog to investigate complaints and educate businesses.

Read more in The Age.

 The City of Los Angeles is looking for a CPO

  • The city of LA is seeking a CPO to fill a newly-created position created as part of a wider local government remodelling.
  • The new CPO “will be responsible for the development of a plan to strategically leverage the city’s spend, identify cost savings, employ long-range operational policies and procedures that align with industry best practices, increase transparency, and reduce time to contract with the city”.

Read more at Supply Chain Digital.

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.

Creating Community Empowerment With Football

How taking an interest in football can help put community empowerment at the heart of public procurement.

Community Empowerment

Lots of public bodies at national, regional and local level like to talk about community empowerment don’t they? That’s because promoting community empowerment is perhaps the holy grail of participatory democracy.

Many politicians and policy makers believe that getting communities more involved in what public money should be spent on and, more importantly, why, will lead to improved outcomes for people and their communities. And there’s plenty of evidence to back this up.

For procurement, tasked with delivering more for less, increasing community empowerment could also mean that the ever-decreasing pot of cash available to spend on public services could actually be deployed in a much more effective way.

Empowerment and Football?

So what we can we do in procurement?  How could we promote community empowerment and what benefits could that bring?  When I was searching Google for examples, strange connections started to occur.  Wherever I found a good example of procurement and community engagement, great football, or soccer to those of you on the other side of the pond, was also evident too. You don’t believe me? Well read on…

Let’s start in the home of sexy football, Brazil.  They’ve been doing a thing called Participatory Budgeting there for a number of years, and it’s a great way to do community empowerment at the front end of the procurement process. Participatory Budgeting in Brazil is an approach which gives local people a direct say in how, and where, public funds can be used to address local requirements.

It started in a place called Porto Alegre in southern Brazil over a decade ago. The first phase of participatory budgeting was to get people together to prioritise how money should be spent, and where investment should go. Should it be parks or water supply, or schools or roads? People at the grass roots of the community were asked to come together in neighbourhood assemblies, and make those decisions.

As the process matured people were able to take decisions at an increasing lower level.  From choices between thematic areas, to choices between services within a theme, to choices about what the specification for that service should be.

So people at the front end determining priorities. Something perhaps we already get involved in from a procurement point of view through User Intelligence Groups, particularly when we have service users involved in that process.

Community Empowerment

What they’ve done in Brazil is a start, but how could we shift control even more directly to people’s hands and empower communities through procurement?

To have a look at how this might be done I moved on to another football hotspot – Spain. I zoomed in on a city which features on a daily basis in my house, and probably every household that has football crazy kids in their midst. Now the football club might be having a great season, but the real reason why Barcelona is a great place isn’t the sublime football of Messrs Neymar, Messi and Suarez.

It’s their approach to procurement using open problems that was the real wow factor for me. Instead of coming up with a specification for a service, they’ve specified the problem, and then gone to the market and asked suppliers to solve it.

They asked people from geographic communities, or communities of interest, to identify what needs they have, and then turned it over to the world’s entrepreneurs to solve them.

Barcelona’s approach was successful. They had 50,000 views of their contract notices, and ultimately let six contracts in this way for issues ranging from tackling bike theft, to systems to tackle social isolation, and empowering local retailers using technology. The thing to understand here, is that communities don’t always know the answer to what they need at the outset – they just know they have a problem.

This method of empowering them to say what they want to change and then enabling them to choose what the answer should be from a range of options, some of which they might not even have considered, is very powerful and procurement is right at the heart of it.

Going Remote and Rural

But is it just in big cities and the regions where these community empowerment approaches might work? Could we use them in remote and rural locations?

My final destination is in one of the great footballing heartlands (well we like to think so anyway!) – Scotland, and my own organisation in the Outer Hebrides.

We wanted to improve community empowerment and link it to a procurement process and so we gave a combination of Brazil and Barcelona a try.  We used a bus service contract but flipped the requirement on its head so we went out to the market to seek travel solutions for people without cars – the problem we sought to solve.

We engaged with the community to identify needs, drive specification development and score the tenders. We embedded community engagement the length and breadth of the procurement process.

To make this happen we assembled our squad of players. The Transport Team in defence, yearning to retain the old ways of doing things, community workers in midfield being creative with their consultation techniques, corporate policy playing in goal making sure we didn’t make any strategic blunders, and finally our strike force, the procurement team, taking all the needs, creativity and service requirements, and converting this into the winning goal by putting a great procurement process and contract in place.

With a 5 per cent budget saving delivered over the lifetime of the contract we clinched the trophy with no need for extra time.

Footballing metaphors aside, promoting community empowerment as part of the way we do things gives those of us in public procurement a real opportunity to shine.

It’s a chance to showcase our talent – getting the right people to have the right input into the procurement process at the right time.

It’s a chance for us to stretch ourselves and learn new techniques. To work with different types of people, using different engagement techniques, at different points in the procurement process.

And it’s the chance to deliver more for less, to provide real answers to the challenges of austerity, and to score that winning goal!

Big Ideas in UK & Public Procurement

Social value and collaboration – just the tip of the iceberg for the professionals in UK and public procurement.

Public Procurement

Ahead of the Big Ideas Summit 2016 this Thursday, 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.

The concept of social value is one that has gained more traction, driven by public procurement professionals across the world. It also links heavily into the idea that procurement as a whole needs to collaborate and work together, something that we’ll also be discussing at Big Ideas.

We spoke to some of our UK-based professionals in the Procurious community to understand the big ideas in the UK and public procurement.

Helen Mackenzie, Head of Procurement, Scottish Local Government

Power Profiles - Helen MackenzieAs those of us working in or with public bodies across the world move forward through our journey of procurement reform, our challenge is now shifting from one where tackling corruption, compliance and procedures are key to one where we’re must add value whenever we can.

At the front end of the process, there’s been some innovative work looking at commissioning services using open problems. Barcelona and Stockholm have had some great results by shifting from specifying the service they wanted, to specifying the problem they wanted to solve.

Adding social value to public procurement contracts continues to be expected by policy makers. In Scotland, we’re including requirements to ensure fair work practices, including the payment of the living wage, and community benefit clauses, which have been used to create added value. For instance 1,000s of apprenticeships have been created as part of our contracts.

Ensuring our communities are involved at the heart of our procurement processes is perhaps the holy grail of public procurement. It’s something which isn’t easy to do, it’s going to require us to stretch our stakeholder engagement skills. The prize will be contracts which target resources where they are needed, people who feel public spending is actually being targeted at them and outcomes which will deliver real improvements in people’s lives.

If we’re successful in shifting our focus away from what we’ve always bought, to what we need to solve with community engagement and social value at the heart of what we do, we’ll certainly secure great contracts and we’ll make the savings we need to deliver in the process.

Jane Lynch, Lecturer, Cardiff Business School

Jane LynchLeading organisations today redesign processes for improving customer experience. This, they argue, leads to more effective business operations.

However, this may lead to initial process inefficiencies (i.e. higher process costs). Who and what should drive process improvement for our business? Is it the supply chain, the organisation’s strategy or is it all about the customer?

Chris Cliffe, Director, CJC Procurement Ltd

Power Profiles - Chris CliffeBig Ideas and innovation in procurement is certainly needed. However, not at the expense of the basics.

Think of Maslow’s hierarchy of needs and apply it to procurement. As a profession, and as individual professionals, we cannot ‘self-actualise’ until we have satisfied the more fundamental needs of our roles. 

As a professional collective, we need to get a lot better at collaborating as individuals, and as a profession, to ensure that the ‘physiological’ and ‘safety’ needs are met, which in our scenario is the basics such as spend analysis, market knowledge, proficiency at transacting procurement processes (particularly the regulated public sector processes).

With that foundation satisfied, we can move on to the ‘Love & Belonging’ and ‘Esteem’ needs, which for us is where many of us still struggle. Being invited to the top table at our organisations as true business partners remains a consistent challenge. 

At this level, we need to be more proactive in demonstrating and promoting contract management and supplier relationship management achievements, not just (but also) procurement process cost savings and force our way in to the strategic conversations. 

From this point we can dream of ‘self-actualisation’.  All contract spend is compliant and being managed well.  Our deep market knowledge is maintained, valued and collaborated on with peers and suppliers alike.  We are highly valued by our executives, and the ‘go-to’ people for business advice and guidance. 

Many of us can only dream of that utopia, and unless we work together on the basics, it will only remain a dream and no amount of retweets will improve our futures.

There’s still time to register for Big Ideas 2016. 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.