In light of recent developments in tracking technology and new legislations that have been passed forcing businesses to be more traceable, the supply chain has once again been put under intense scrutiny.
Despite CSR being high on procurement’s agenda, still examples of human slavery in the supply chain emerge. Therefore, procurement needs to be aware of what tools it can leverage to improve the ethics in its supply chains and what types of technology will expose human slavery in the future.
New technology means no more excuses
Human rights abuse in the supply chain is a significant concern according to a recent survey in Ethical Corporation with over 50% of procurement professionals recognising its importance —and with good reason as it’s still a huge issue. According to estimates made by the ILO, there are approximately 21 million slaves in the world, generating $150 billion in profits for traffickers every year. Therefore, establishing ways that technology can help prevent breaches of human rights is highly beneficial for procurement. There are industries where slavery in the supply chain is rife (fishing and manufacturing to name a few) and it’s in those areas that there is a need for this type of technology. Claiming ignorance is no longer a valid excuse when human slavery in the supply chain is uncovered so procurement needs to be doing everything it can to prevent that.
Leverage technology for greater control
Producing a fully ethical supply chain is no easy task as companies grow and expand. Therefore, procurement need to be leveraging latest innovations in technology to make it simpler. Innovations in technology such as Blockchain are allowing consumers and suppliers to open up the supply chain to scrutiny as everything is recorded digitally, thus making the chain a lot easier to follow. Digital ledgers such as these give consumers and suppliers the guarantee of greater transparency by allowing them to track the journey of each product from start to finish.
This could be a significant area for procurement to focus on as it would allow internal customers to have greater choice and be more selective about who they chose to do business with. Procurement professionals cannot avoid the value that investing in these types of technologies can bring. Technology cannot ban illegal practises or eliminate human slavery altogether, but it can take back control of areas that have since slipped through organisations fingers.
Introduction of serialisation
The recent introduction of Track and Trace serialisation throughout many supply chains could be a game changer for procurement’s approach to managing risk in the supply chain as this will force them to be fully traceable by 2018. Already the pharma industry are taking steps in being entirely transparent and it seems more than likely that other industries will follow suit. Serialisation’s end-to-end verification system will help eliminate cases of slavery in the supply chain and if procurement hasn’t already started preparing for this then it is behind.
It’s not just the pharma industry that these serialisation changes are limited to either, it’s more than likely that these will spread throughout a number of different procurement categories. The gradual integration of nano technology in certain areas of industry will mean everything will become traceable so procurement should be using this an opportunity to examine and alter (if necessary) where it invests in technology in order to make use of these advanced opportunities.
With initiatives designed to combat human slavery in the supply chain being introduced constantly procurement needs to make sure that it embraces these changes by using technology to help build an ethical supply chain from start to finish.