PL Forum: Anglo American on local procurement

Andrew Hinkly, CPO of Anglo American was bold with his opening gambit at the Procurement Leaders Forum at The Brewery in London today. He stood up before a room of high level CPOs and professed that when he came into his role, local procurement wasn’t something he took all that seriously.

Sure, it was part of what his company, being international mining, did – but as a concept it was only so useful. However, he quickly asserted, that has changed drastically.

In fact, so dramatic has the change of viewpoint been, that Anglo American now considers, so we were told, local procurement to have strategic value on both the supply and demand side.

The local procurement policy that the company has in place is aimed at being multi-faceted, inclusive, demonstrative of sound governance, and to be focused on partnerships.

Of course, the beauty of many of these ideas is that they have application whether we’re talking about working with communities around some of the locations where the mining operations take place, or indeed working with operations on the ground, the speed and effectiveness of which can be vital to the overall value of an investment.

Undoubtedly this is something that will have struck competitors too, but where it gets interesting is looking at the various ways in which procurement, as Hinkly put it ‘steps into the void to deliver value’.

Procurement’s ability to look at stakeholder mapping whilst also establishing integrated development programmes to work with local communities and local suppliers, as has been done at Anglo, puts it in a unique position. And you’d bet that mining wasn’t the only industry where these concepts come into play.

So it’s telling then that Hinkly, who, as he said, wasn’t convinced that local procurement wasn’t a separate theme running alongside the central tenets of the function, has a completely different message today.

Perhaps other global organisations not thinking in this way would do well to take note.