It’s not unusual for procurement chiefs to have a background in manufacturing – if you’ve seen the production line, watched a product come to life from a design, you already know a lot about what you need from suppliers. But for many, there’s still work to be done in defining what procurement is to manufacturing.
Some people truly believe that China is going to stop being the world's workshop. It's been discussed and debated for years – I've had my stab at the subject before and I've seen many prominent writers proclaiming the end of China as a low-cost sourcing destination. But no-one's been right so far: China is still number 1. Why?
Earthquakes, rising fuel prices, diversity - there’s any number of reasons for the business to coming knocking on the CPO’s door. We’ve looked a lot this week at where the bigger issues are and how procurement has been reacting.
Procurement’s role in sustainability is predicated on its ability to influence suppliers’ compliance to sustainability policies, essentially policing the agenda. Yet given its unique role within the supply network, procurement needs to push for a more transformative role.
If procurement doesn’t act as a pipeline for innovation coming from the supply base, a business can die. Or how about another way – if procurement doesn’t listen to suppliers warnings, it can be painfully slow to jump when cracks start to form in the market. When you look at companies that failed, you have to ask: did they listen to suppliers?
Technology is going to save us. At least that’s the theory. I’ve seen many articles about how important it is for individuals to bring about change in businesses and how people have a role to play in leading the shift to sustainable procurement – all of which I stand by. However, it’s impossible to understate the impact technology has and maybe the most important thing a business leader can do today is to understand the opportunity that solutions can offer.
Proving green credentials isn’t easy. There’s yet no standard measuring system, there’s a lot of different approaches to auditing suppliers and there’s a veneer of cynicism over the value of results. But if investors are beginning to take more notice of how businesses score on sustainability, no one can afford to be ignoring the call for data on the supply chain.
“Knowing your customers” and “integrating with your suppliers” are two common business mantras these days. Both customers and suppliers can provide you with new ideas, whereas suppliers can also help with their technical development. Integrating both in new product development therefore makes a lot of sense.
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