Tag Archives: sustainability

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.

7 stories you might have missed

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Coca-Cola supply chain

Coca-Cola pledges $5bn investment

  • The Coca-Cola Company and its African bottling partners announced a new investment of $5bn during the U.S.-Africa Leaders Summit in Washington.
  • The investment, to be made over the next six years, increases its total announced investment in Africa to $17bn from 2010 to 2020.
  • The Company and its bottling partners anticipate that this investment will fund new manufacturing lines, cooling and distribution equipment and production; create additional jobs and opportunities across Coca-Cola’s African supply chain; and support key sustainability initiatives and programs focused on safe water access, sustainable sourcing, women’s economic empowerment, community well-being and operational efficiency improvements.

Read more by Coca-Cola Company

KFC’s Indian ambitions hit by quality-control issues

  • The fast-food chain is already China’s biggest restaurant operator with 4600 outlets, but it appears that opening 2 new stores a day is beginning to take its toll – especially when it comes to quality-control.
  • KFC is reeling after a Chinese supplier was accused of selling expired beef and chicken to it, McDonald’s and possibly other restaurant chains.
  • “On the supplier side, people are not well-trained, or there is not good oversight,” said Ben Cavender of the China Market Research Group. “On the restaurant side, they have people checking the products, but they probably don’t have enough people who are spending enough time at the supplier sites.”

Read more on USA Today

APICS, Supply Chain Council merger completed

  • APICS has announced that it has completed its merger with Supply Chain Council, creating a global provider of supply chain research, education and certification programs.
  • “As APICS and APICS SCC, we now have the resources to ensure supply chain organizations are ready to address two of the most important topics in the global economy today – elevating supply chain performance and developing supply chain talent,” said Abe Eshkenazi, CEO of APICS.
  • The merger creates a global leader in supply chain solutions, poised to benefit members, customers, partners and employees in several ways.

Read more about the merger on Supply Chain Brain

Kimberly-Clark releases sustainability report

  • When it comes to sourcing, Kimberly-Clark has set lofty goals. The target is to source 100 per cent of its wood fiber from suppliers who have achieved third-party certification of their forestry activities by 2015.
  • A 2016 target is to achieve 100 per cent chain of custody certification. All of the Kimberly-Clark tissue mills in North America and Europe are already chain of custody certified.
  • The company also achieved a 26.4 percent reduction in water use in manufacturing in 2013, beating its 2015 goal of 25 per cent. Further reductions can be observed in areas such as greenhouse gas emissions, and energy use.

Read more on TriplePundit

World Bank’s procurement process to undergo reform

  • Under the changes a one-size-fits-all methodology will be replaced with a more tailored approach, with procurement made more “fit for purpose”. Christopher Browne, the bank’s CPO, said: “We’re making World Bank procurement fit for the future.”
  • The new framework introduces sustainability, use of procurement systems other than the World Bank’s, engagement with strategic suppliers and a more streamlined approach to complaints.
  • The bank has a procurement spend of £26 billion a year but its current procurement processes were established in the 1970s.

Read more on Supply Management 

Supply chains becoming increasingly vulnerable to cyber attacks

  • While natural disasters such as earthquakes, tsunamis and flooding have disrupted supply chains around the world, cyber attacks pose even greater risks as companies rely more on computers and the Internet to conduct their business.
  • Companies need to be keenly aware of their cyber and supply chain risks as well as the limits of cyber, business interruption and general liability policies when buying insurance.
  • “Supply chains, especially critical infrastructure supply chains, can potentially be very vulnerable to hacking and malware attacks and, depending upon the attacker’s motivation, susceptible to business interruption and extra expense exposure,” said Ken Goldstein, Hartford, Connecticut-based vice president and worldwide cyber security manager at Chubb Corp.
  • “Space in warehouses is expensive, but what if somebody takes out your weekly shipment?” said Dena L. Magyar, Charlotte, North Carolina-based vice president and national practice leader in the professional risk group at Wells Fargo Insurance Services USA Inc.

Read more on Business Insurance

Drilling tower

Sasol enjoys 17% profit hike, eyes-up local suppliers

  • The world’s largest producer of gasoline from coal said full-year profit probably rose as much as 17 per cent as an increase in synthetic-fuels output exceeded its forecast and the rand weakened.
  • It was recently reported that it was looking to increase the number of local firms in its Mozambican supply chain. Benjamim Cavel, local content manager for Sasol in Mozambique, said the company had to “lead by example” and it was working with local suppliers to bring them up to the level where they can compete with multinationals.
  • Speaking at the CIPS Pan African Conference in Zambia, he said: “Sasol Upstream Oil and Gas intends to grow the economy of Mozambique. One way is to integrate the local supplier market into supply chain activities.

Read more on Bloomberg