Tag Archives: Procurement Transformation Institute

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Strategic Relationship Management Advice

By Pat Ryan – Arvo

Your suppliers are your external manufacturing department. They do what you don’t want to do; because it’s technologically impractical, they are better than you, you are concentrating on other things, or it could tie-up your resources.

FACT: You are trusting them with your future

Developing good connections with suppliers—sometimes called Supplier Relationship Management—is critical to business success.

Businesses are increasingly relying on suppliers to help reduce costs, innovate, improve quality and reduce lead time. Good relationships with suppliers can provide a competitive advantage.

First-rate supplier relations require continuous, long-term effort. Not all suppliers should be treated as special suppliers. Some of the suppliers may not be suitable for developing relationships.

  1. Evaluate all suppliers—Make sure they are the best ones for your business and that their products meet your needs. You want suppliers who are aligned with your strategy.
  2. Integrate key suppliers into your business—Learn how they operate, and make sure your systems work seamlessly with theirs in areas such as invoicing and order fulfilment.
  3. Collaborate on quality improvement, problem-solving and product development—Work together to improve capabilities and adopt best practices on both sides.
  4. Measure performance continually—Have structured ongoing discussions with your key suppliers about how to improve.

Ultimately, the idea is to work together as partners so both sides prosper.

BE BRAVE – NOT ALL COMPANIES CAN DEVELOP AND MAINTAIN A SUPPLIER RELATIONSHIP PROGRAMME.

Sometimes companies focus just on the short term and only demand cost reductions from suppliers, rather than thinking strategically. That doesn’t help in the long run.

Do’s and don’ts of supplier relationships

  1. DO—Take a long-term approach to supplier relationships. Commit to shared prosperity and mutual development. Help suppliers boost their technical and problem-solving capabilities.
  2. DO—Understand in detail how your key suppliers work. See how they operate, and learn their culture to ensure mutual trust and strong partnerships.
  3. DO—Periodically evaluate the performance of key suppliers with scorecards, and periodically scan the market for better and/or more cost-effective alternatives. While you want to nurture strong relationships with suppliers, you don’t want to become captive to them.
  4. DON’T—Focus only on short-term goals, such as cost-cutting. Don’t insist on unreasonable payment terms or pressure suppliers to assume the cost and risk of holding the bulk of your inventory.
  5. DON’T—Focus your efforts on all your suppliers. Save your special collaboration for only a handful of key strategic partners. Anything more is unsustainable.

The Procurement Transformation Institute

On January 31st we launched the Procurement Transformation Institute in partnership with IDDEA. The PTI is a not-for-profit organisation founded by a team of expert procurement practitioners, academics, advisors and thought leaders.

Partnering with 9 procurement competency centres in Europe, PTI is positioning procurement as a preferred career for today’s and tomorrow’s professionals for the benefit of competitiveness, job creation and innovation for organisations of all sizes in Ireland.

The PTI is based on the island of Ireland and works in collaboration with SMEs, multinationals, universities, professional associations and institutes. Our vision and mission are international; we research and translate procurement standards into deliverable value for organisations and individuals.

 

The PTI is built around 5 pillars:

PTI ACADEMY: whose mission is to develop a CPD Procurement Membership Body offering all procurement resources relevant mind set, skillset and toolset training that will steer and guide them on the progression on their career path.

PTI COMMUNITY: whose mission to create an environment of peer to peer communication and knowledge exchange, access up to date industry and European wide accepted standards, tools, insight, initiatives and trends. The PTI Community forum was launched on April 25th, 2018. See below for more information.

PTI EUROPE: As part of the Procure2Innovate H2020 Initiative, the PTI is excited to be part of the European Initiative to promote and disseminate Innovation Procurement Best Practices. The aim is to improve support for public procurers in implementing innovation procurement by establishing and expanding competence centres for innovation procurement in 10 EU member States. Indeed, to date, competence centres have largely worked autonomously and with little cross-border cooperation.

PTI EDUCATION: whose mission is to provide and promote European-wide accredited procurement certification in partnership with UCC, to pipeline and upskill procurement resource to benefit the growth of businesses.

PTI RESEARCH: whose mission is to deliver valuable and on-going research about the impact

of the changing environment on procurement. We want to ensure that the procurement profession stays relevant for the future. Through continuous optimisation and transformation, ongoing innovation is driven by industry-led research and thought leadership.

 

To keep up to date with the PTI and to gain greater insight into the world of public procurement, become a member of our inaugural Community forum by signing up here.

100 DAYS TO GDPR

The General Data Protection Regulation aims to strengthen the protection of personal data. The current data legislation dates back to 1995 with the Data Protection Directive which has a lack of harmony and has not evolved to deal with the current uses for Data eg marketing. The principles remain the same but the new policy is meant to update standards to fit today’s technology which has changed dramatically since 1995. Today, there are 3 billion internet users compared to 16 million 20 years ago, with the rise of social networks. The GDPR affects all businesses operating within the EU: EU Companies that process personal data, Non-EU companies who offer goods or services to individuals in the EU and Non-EU companies who monitor individual’s behaviour that takes place in the EU. It will come in effect on May 25th 2018 and we have to make these changes now to ensure that we are compliant.

MAIN CHANGES :

  • CONSENT : Permission and consent are required to send marketing information. The consent must be unambiguous, informed and freely given. Prior to giving consent, data subjects (individuals whom particular personal data is about) must be informed of the right to withdraw consent at any time and it must be easy for them to do so. For children under 16, a parent or guardian must give his approval.
  • RIGHTS FOR DATA SUBJECTS : Right to be informed, Right to access, Right to rectification, Right to erasure, Right to restrict processing, Right to data portability, Right to object, Rights in relation to automated decision making.
  • DATA BREACHES : for example the destruction, loss, alteration, unauthorised disclosure of or access to personal data, human error. New mandatory obligation to notify data breaches to the regulator ASAP but not later than 72 hours and if notification is not made after 72 hours a reasoned justification is needed.
  • ADMINISTRATIVE FINES AND COMPENSATION : Under the GDPR, data subjects will have a right to sue and recover material or non-material damages, e.g. loss of personal data, damage to reputation, loss of confidentiality. The current maximum fines are €3000 but GDPR fines are up to €20 million or 4% of the Turnover.
  • INCREASED TERRITORIAL SCOPE : The policy applies to all companies processing the data of E.U. subjects , regardless of the company’s location.
  • PRIVACY BY DESIGN : Data protection has to be included in the initial system design rather than added later.

 

 

KEY ACTIONS TO BE TAKEN

1/ AUDIT :

  • You are required to document what personal data you hold, where it came from and who you share it with.
  • It is recommended to conduct an information audit across the organisation or within particular business areas which need to be GDPR compliant.

2/ IDENTIFICATION :

  • You should check your procedures to ensure they cover all the rights individuals have, including how you would delete personal data or provide data electronically and in common used format.
  • You should identify the lawful basis for your processing activity in the GDPR, document it and update your notices.

3/ UPDATE DATA PROTECTION POLICY :

  • You should update your procedure for dealing with subject requests to handle them within the new timescales;
  • You should review how to seek, record and manage consent and whether you need to make any changes.
  • You should also put a system in place to verify individuals’ age and to obtain parental or guardian consent for any data processing activity.
  • Finally you should make sure you have the right procedures in place to detect, report and investigate a personal data breach.

4/ UPDATE PRIVACY NOTICES :

  • After updating the data protection policy, it is important to review your current privacy notices and put a plan in place for making any necessary changes in time for GDPR implementation.
  • They have to be concise and in an easy-to-read format with limited legalese.
  • They must include : identity and contact details of the controller and the Data Protection Officer; purposes and legal basis for the processing; recipients of the personal data; retention periods; details on the right to access to personal data and rectification or deletion of it; right to withdraw consent; …

5/ UPDATE CONTRACTS WITH PROCESSOR AND CONTROLLERS : the contracts must set out :

  • The subject matter and duration of the processing
  • The nature and purpose of the processing
  • The type of personal data and categories of data subject
  • The obligations and rights of the controller

6/ CONSIDER AN APPOINTMENT WITH A DPO :

You should designate someone to take responsibility for data protection compliance and assess where this role will sit within your organisation’s structure. A Data Protection Officer can be outsourced to assist you in managing your organisation on its journey to becoming GDPR compliant . If your organisation operates in more than one EU member state, you should determine your lead data protection supervisory authority.

7/TRAINING :

  • You should ensure that everybody is aware that the law is changing to the GDPR (mostly decision makers and key people) so they can start identifying areas that could cause compliance issues.
  • You then have to train relevant staff and teach them how GDPR affects their role.

 

WHAT PROCUREMENT TEAMS SHOULD DO

Map the flow of personal data through supply chains. Identify recipients of personal data, including sub-processors. Note where and how the personal data is processed.

Identify existing supplier contracts that involve the processing of personal data and review the data protection provisions.

Consider the organisation’s approach to risk with existing and new contracts in relation to GDPR compliance. The financial risks posed by the regulation may change the risk profile of data processing contracts, necessitating a different approach Not sure what was meant here?? and data security breaches.

Carry out adequate due diligence on new suppliers to check their GDPR compliance, obtain guarantees regarding the measures that suppliers have in place and ensure there are rights of audit within the contract together with the other mandated data processing provisions.

Check whether existing insurance policies will cover data protection and security breaches including breaches by suppliers.

Check internal systems to ensure that processes are in place to enable the organisation to satisfy the 72-hour breach notification requirement.

 

USEFUL GDPR LINKS

For more information : https://ico.org.uk/for-organisations/guide-to-the-general-data-protection-regulation-gdpr/ OR https://gdprandyou.ie/organisations

Are you ready for GDPR ? make sure you have not forgotten anything thanks to this MCQ

You can also consult the Irish Data Protection Authority website.

Pixalert can help you by providing a software which locates all credit card data and critical data in your network to be GDPR compliant.

 

To assist you on how to get started and what GDPR means to your business, ISME Skillnet have designed GDPR Preparation training sessions called GDPR Essentials for SMEs specifically aimed at SMEs and business owners.

The first session in this series on Thursday, 15th February in the Clayton Hotel, Liffey Valley, Dublin is already booked out.

Additional sessions will take places in:

The Dun Library, Royal College of Physicians, 6 Kildare Street, Dublin on Wednesday 21st February

Clayton Hotel, Silver Springs, Tivoli, Cork on Tuesday, 6th March

Limerick Strand Hotel, Ennis Road, Limerick on Wednesday 7th March

BOOK YOUR PLACE NOW 

Brexit and your Supply Chain

As you know by now, European President Jean-Claude Juncker had a meeting with British Prime Minister Theresa May last Friday morning to agree a historic deal defining the terms of Britain’s divorce from the EU. If all that was agreed on December 8th comes to pass, the UK has essentially committed to a soft Brexit.

Ireland has done well in Phase 1 of the Brexit negotiations, including preserving the Common Trade Area, protecting the Good Friday Agreement and, crucially, obtaining a guarantee that there will be no hard border. It is now for the European Council to decide today if sufficient progress has been made to allow the negotiations to proceed to Phase 2, which is a significant step forward in the process leading towards UK withdrawal from the EU in March 2019. It is expected that a transition period would last two years ensuring Britain will remain part of the customs union and single market (including being subject to EU law) until 2021.

Thereafter, the risks and unknowns for your business need to be carefully considered. Most proactive businesses have started to document Brexit assumptions within their Brexit action plans, supporting their planning and strategy work. Whether importing directly or indirectly from the UK, the impacts to your operating model, supplier base, cost base and working capital requirements needs to de analysed, to understand where the areas of greatest risk are (so as to develop suitable mitigating actions to reduce the impact of Brexit on your business).

 

Specifically focusing on your supply-base and imports, can you answer the following 5 questions to identify risks and resilience steps for your business?

 

  1. What suppliers will impact the business most if they cannot supply you tomorrow?

 

  1. Do you know what % of your goods and services are coming directly or indirectly from the UK?

 

  1. Have you researched alternative non-UK suppliers?

 

  1. Are there contracts, licenses or regulations restricting your global sourcing strategies?

 

  1. Are you aware of the potential additional costs to import from Europe in terms of hubbing, logistics partners, Minimum Order Quantities plus the impact on cash flow?

 

As Arvo have been participating in Enterprise Ireland’s Brexit Roadshows recently, let us know today how we can help build resilience into your supply chain for Brexit (& other Political, Economic & Technological events that may cause risks for your business in future).

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