Future of Sourcing - Environmental and social governance (ESG) http://futureofsourcing.com/tags/environmental-and-social-governance-esg-0 en 7 Reasons Why India and Southeast Asia are Promising Sourcing Alternatives to China http://futureofsourcing.com/7-reasons-why-india-and-southeast-asia-are-promising-sourcing-alternatives-to-china <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/India-Southeast-Asia.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/India-Southeast-Asia.jpg" title="Buyers can no longer depend on just one country for all their sourcing needs." class="colorbox" rel="gallery-node-2212-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/India-Southeast-Asia.jpg?itok=T0zI0V2g" width="624" height="325" alt="Buyers can no longer depend on just one country for all their sourcing needs." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Today, buyers can no longer depend on just one country for all their sourcing needs says Aditi Pany, CEO of <a href="http://qalara.com/" target="_blank">Qalara.com</a></em><em>. </em><em>She offers detailed insights into the strong benefits of sourcing from this region and why it makes for a sound business decision.</em></p> </div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>The south and southeast regions of Asia comprising nearly 19 countries, including India, Indonesia, Vietnam and Thailand among others, have a rich history of production and trade going back thousands of years. In fact, historians believe that the world&rsquo;s first long distance trade occurred between Mesopotamia and the Indus Valley (Indian subcontinent) in 3,000 BC, centered around textiles, spices, jewelry and artifacts.</p> <p>While China has been the undisputed manufacturing epicenter for decades now, in recent times, export manufacturing in this part of the world has seen tremendous evolution and a renewed gusto. Today, Bangladesh, Vietnam and India are among the top five textile exporters in the world. India is the largest producer and exporter of spices in the world while Thailand and Indonesia are the top two exporters of rubber products, covering nearly 55% of all exports in this category worldwide.</p> <p>This growth has been driven by a number of factors that will continue to strengthen the crucial role of this region in global trade in the coming decades. Here are some key levers that are increasingly making these countries viable sourcing options aside from China.</p> <h1>1. Rising Labor Costs in China</h1> <p>China&rsquo;s wages have increased multifold since 2011, resulting in a minimum wage difference of up to 50% compared to countries such as Indonesia and parts of India. At the same time, labor policy reforms, productivity improvements due to better infrastructure and machinery, and the access to a huge workforce positions these countries as an attractive alternative.</p> <h2>2. Rapidly Evolving Manufacturing Support Ecosystems Powered by Digitization and Economic Development</h2> <p>The growing strength of domestic markets in these regions and the deep penetration of digitization in their economies has benefited the manufacturing ecosystem. Massive strides in payments, innovation and reach of domestic logistics and packaging as well as an improved digitally enabled visibility of the production floor have given rise to better services, lower investment costs and a digitally savvy manufacturer base. This in turn positively impacts the cost, quality competitiveness and transparency in these countries.</p> <h2>3. Lower Tariffs With Growing Free Trade Agreements</h2> <p>The countries in these regions have been actively and successfully negotiating free trade or preferential trade agreements with the western countries in the last few years. These have resulted in steadier and lower duties and tariffs, especially compared to China in recent times. For instance, Vietnam signed a comprehensive trade agreement with the European Union (EU) in 2020 while India and the EU have set up a high-level Trade &amp; Technology Commission to strengthen ties.&nbsp;</p> <h2>4. Big Focus on Sustainable and Eco-Friendly Production</h2> <p>With their tropical geographical locations, these regions of Asia have been endowed with natural resources across a variety of materials including wood, bamboo, stone, marble, and metals such as copper and brass. The local artisans who possess centuries-old rich craftsmanship cleverly convert these natural materials into everyday objects incorporating modern design sensibilities. There is an incredible amount of product innovation using natural materials taking place in India, Vietnam and Indonesia. With an increasing awareness and demand for eco-friendly products, these regions will play a huge role in the move towards a sustainable global supply chain and consumption.</p> <h2>5. Low Minimums Enabling New Brands, Wider Selection and Less Waste</h2> <p>Two of the current big global retail trends are (a) the growing share of small and medium-sized brands in retail due to the democratization of digital distribution led by e-commerce platforms and (b) the growing importance of e-commerce as a key channel for sales.</p> <p>Both of these trends require a global supply chain that is able to manufacture low minimums with quick turnarounds to support new brands and enable their breadth of selection online. Given the inherent labor-intensive nature of production in these countries, manufacturers are often willing and able to produce goods, including private labels, at lower minimums compared to China.</p> <h2>6. Bridging of the Information Asymmetry</h2> <p>In the past, China has been in the lucrative position of intimate access to product, pricing and trends because it has been the epicenter of manufacturing for the world&rsquo;s plethora of global brands. However, in this new age of information, the pervasiveness of social media, digital commerce, the global gig economy and even digital trade fairs have given manufacturers in these countries easy access to insights on the latest trends, pricing, seasonal merchandising and much more. They are able to quickly adapt and put out exciting product ranges at the right prices and right time like never before. It&rsquo;s a relatively better level playing field than ever before.</p> <h2>7. Growing Ease of Access to the Manufacturers and Suppliers, Digitally and Affordably</h2> <p>While Alibaba.com was the pioneer in cross border B2B e-commerce, today India and the Southeast Asian regions have a growing share of their own digital B2B marketplaces and platforms. These platforms are curating and consolidating vetted supplier bases, while plugging the gaps to drive efficiencies and reliability in quality, global logistics, global payments and more, making it easy for businesses around the world to discover and source from them remotely, conveniently and affordable.</p> <p>While there is still a long way for this region to catch up with China in terms of infrastructure, pervasiveness of advanced machinery, global supply chain ecosystem and the trade knowledge, India and the southeast Asian countries have unique advantages that make a compelling argument for big and small retailers, importers and brands to strongly consider devising sourcing strategies beyond China to give their businesses a competitive edge.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/outsourcing" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Outsourcing</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="7 Reasons Why India and Southeast Asia are Promising Sourcing Alternatives to China - Future of Sourcing" addthis:url="http://futureofsourcing.com/7-reasons-why-india-and-southeast-asia-are-promising-sourcing-alternatives-to-china"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/asiapacific" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Asia/Pacific</a></div></div></div> Mon, 08 Aug 2022 02:00:00 +0000 Aditi Pany 2212 at http://futureofsourcing.com http://futureofsourcing.com/7-reasons-why-india-and-southeast-asia-are-promising-sourcing-alternatives-to-china#comments The Power of Impact Sourcing and Why it Matters http://futureofsourcing.com/the-power-of-impact-sourcing-and-why-it-matters <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/The-Power-of-Impact-Sourcing-and-Why-it-Matters.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/The-Power-of-Impact-Sourcing-and-Why-it-Matters.jpg" title="Impact sourcing is philanthropic by nature, but you shouldn’t ignore the economic and business value it can provide." class="colorbox" rel="gallery-node-2211-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/The-Power-of-Impact-Sourcing-and-Why-it-Matters.jpg?itok=92emApwY" width="624" height="325" alt="Impact sourcing is philanthropic by nature, but you shouldn’t ignore the economic and business value it can provide." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Impact sourcing is philanthropic by nature, but you shouldn&rsquo;t ignore the economic and business value it can provide says Frédérique Froment-Kelleghan, Senior Manager, Transforming Talent, <a href="https://www.welocalize.com/" target="_blank">Welocalize, Inc.</a> She shares four key benefits of impact sourcing.</em></p> </div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>The key to success for any business is the quality and consistency of its workforce. Business leaders are always on the lookout for high-quality talent, and if this talent can be acquired with low attrition rate, then you&rsquo;re onto a winning formula. This is where impact sourcing can come into play.</p> <p>Impact sourcing, a business buzzword, is part of Business Process Outsourcing (BPO). Outsourcing used to be shrouded with negative connotations. Images that sprung to mind were employees on the other side of the world working in poor conditions for less than minimum wage or businesses that cared more about money than employee welfare.</p> <p>However, there has been a huge shift in the practice of outsourcing. Businesses can flop if they do not actively show the wellbeing of their employees is a top priority.</p> <p>Impact sourcing has grown in popularity since the Covid-19 outbreak. It is also a way for organizations to make a positive social impact.&nbsp;</p> <h1>What is Impact Sourcing?</h1> <p><a href="https://gisc.bsr.org/about/what-is-impact-sourcing" target="_blank">The Global Impact Sourcing Coalition</a> defines impact sourcing as a practice where a business will prioritize, hire, and promote career development for people from social or economically disadvantaged backgrounds. Organizations strategically employ people who are from a disadvantaged background to socio-economically empower them so that they are able to earn a decent living. The model focuses on impacting the entire community by changing the life trajectory of the individuals for the better.</p> <p>The type of employees hired through impact sourcing will be dependent on the locale they are based in, but in general, impact sourcing tends to target women, unemployed youth, or people who live in rural or poverty-stricken areas.</p> <p>These employees are usually equipped with the skills, talent or qualifications needed for entry-level roles, but are unable to find work due to certain societal or economic hurdles and/or for lack of specialization.</p> <p>Impact sourcing is really a win-win situation for employers and employees. The employers can hire a new, talented workforce, while the employees&rsquo; quality of life will improve as will their societies.</p> <p>With impact sourcing, employees will likely earn more than they would in their present job, and this extra income can impact their families and livelihood.</p> <h2>What are the Benefits of Impact Sourcing?</h2> <p>Impact sourcing is philanthropic by nature, but don&rsquo;t ignore the economic and business value it can provide. Here are four key benefits impact sourcing can offer your brand.</p> <h2>1. Diverse Workforce</h2> <p>Unlike traditional outsourcing providers, who usually rely on the same regurgitated resources, impact sourcing allows you to <a href="https://www.rockefellerfoundation.org/blog/why-impact-sourcing-good-businesses/#:~:text=Our%20research%20shows%20that%20impact,many%20companies%20using%20impact%20sourcing." target="_blank">uncover fresh, untapped talent</a>. This new pool of talent will likely possess a wide range of skills and a desire to learn and develop their careers.</p> <p>For the majority of these new workers, this will be their first professional job with a decent wage. As a result, these employees tend to be more motivated and committed to your company.</p> <p>By investing in employees with great potential, your business will be in a position to reap the rewards for years to come.</p> <h2>2. High-Quality Work and Low Attrition</h2> <p>This follows on nicely from the previous benefit. Put yourself in the position of an impact worker. You&rsquo;ve struggled to find a stable job that offers a decent wage and now a company has offered you a position that will satisfy all your basic financial needs coupled by an extensive professional training to grow your skills in specific areas.</p> <p>How would you feel? For most of us, we would feel a sense of relief, gratitude for our employer and would be determined to exceed our employer&rsquo;s expectations.</p> <p>Impact workers tend to be incredibly grateful for these opportunities, and because of this, they are usually loyal to their employers. Attrition rates tend to be very low among impact workers. In fact, impact workers have <a href="https://www.rockefellerfoundation.org/blog/why-impact-sourcing-good-businesses/" target="_blank">15% to 40% lower attrition</a> than other outsourcing employees.</p> <p>This lower attrition rate means you will save a considerable amount of money you would spend on recruitment and new hire training. What you will have is an experienced and dedicated workforce that will help you achieve your business goals. What could be better?</p> <p><em>&ldquo;Purpose is at the heart of this. It&rsquo;s the core of what we do at Digital Divide Data. It&rsquo;s really about making a difference and creating the stepping stones to move forward both personally and professionally. Talent doesn&rsquo;t have boundaries, so we shouldn&rsquo;t either.&rdquo; - </em>Jeremy Hockenstein, CEO, Digital Divide Data</p> <h2>3. Long-Term Savings</h2> <p>With low attrition rates come increased cost savings. Businesses that employ impact workers often avoid the costs that come with re-hires. In the long run, impact sourcing is a highly profitable business venture.</p> <p>Impact Sourcing also offers higher upfront cost savings. Take India for example, Impact Sourcing has yielded a colossal <a href="https://www.rockefellerfoundation.org/blog/why-impact-sourcing-good-businesses/#:~:text=In%20India%2C%20impact%20sourcing%20offers,BPO%20in%20an%20outsourced%20model.&amp;text=In%20India%2C%20the%20savings%20are,1%20locations%20for%20traditional%20sourcing." target="_blank">35% to 40% reduction</a> in expenses compared to other traditional BPO models.</p> <p>Today, <a href="https://www.smallbizgenius.net/by-the-numbers/outsourcing-statistics/" target="_blank">59% of businesses</a> use outsourcing to reduce their expenses, and the Impact Sourcing blueprint can help you save without damaging your company&rsquo;s overall productivity and efficiency.</p> <h2>4. Social Impact</h2> <p>For years, supply chain logistics has revolved around maximizing sourcing and distribution at the lowest cost. And yes, while this business approach does work if you want to gain a high profit in a short timeframe, it may not be the most profitable solution in the long run.</p> <p>Impact sourcing is at its core an egalitarian approach. It puts the priority on wealth distribution over financial ideologies. Today, business leaders feel impact sourcing is the better solution for long-term sustainability and business growth.</p> <p>It&rsquo;s a harsh reality, but primary suppliers are normally the lowest paid and underrepresented links throughout the entire supply chain.</p> <p>Impact sourcing will not be able to dismantle the socio-economic system that oppresses certain producers from certain countries in poverty. What it can do is alleviate poverty in communities across the globe.</p> <p>As time goes on, impact sourcing could potentially take many economic pressures primary suppliers face off their hands, and that will galvanize us towards a new sustainable future.</p> <h2>In Conclusion</h2> <p>The future of business, and how businesses run, is always evolving. And today, showcasing yourself as a reputable company that cares about sustainability as well as the welfare of your employees has never been more important.</p> <p>Right now, the potential that impact sourcing can have not only to your annual revenue, but to the inclusivity and sustainability of global workforces is impossible to ignore. So, now is the time to adopt this impact sourcing into your current business model.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/impact-sourcing" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Impact Sourcing</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="The Power of Impact Sourcing and Why it Matters - Future of Sourcing" addthis:url="http://futureofsourcing.com/the-power-of-impact-sourcing-and-why-it-matters"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Wed, 03 Aug 2022 02:00:00 +0000 Frédérique Froment-Kelleghan 2211 at http://futureofsourcing.com http://futureofsourcing.com/the-power-of-impact-sourcing-and-why-it-matters#comments How Procurement Teams Can Diversify Suppliers And Manage Risk http://futureofsourcing.com/how-procurement-teams-can-diversify-suppliers-and-manage-risk <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Diversify-Suppliers-And-Manage-Risk.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Diversify-Suppliers-And-Manage-Risk.jpg" title="Procurement officers have an important role in helping minority-owned suppliers overcome barriers to accessing contracts through smart risk management policies." class="colorbox" rel="gallery-node-2209-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Diversify-Suppliers-And-Manage-Risk.jpg?itok=ODIev78W" width="624" height="325" alt="Procurement officers have an important role in helping minority-owned suppliers overcome barriers to accessing contracts through smart risk management policies." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Procurement officers have an important role in helping minority-owned suppliers overcome barriers to accessing contracts through smart risk management policies says Lara Hodgson, CEO and Co-founder of <a href="https://nowcorp.com/" target="_blank">Now</a>. She shares five tips to help procurement teams meet DE&amp;I supplier goals.</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/cash-flow-velocity-redefining-supply-chain-financing">Cash Flow Velocity: Redefining Supply Chain Financing</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>Over the past few years, large enterprises have made incremental progress toward a more diverse supplier ecosystem, but we&rsquo;re still not there. A recent <a href="https://fortune.com/2022/01/25/your-corporate-supplier-diversity-efforts-are-not-going-as-well-as-you-think/" target="_blank">survey of 100 large global companies</a> by The Hackett Group found these companies intend to increase spending on diverse suppliers by over 50% during the next three years. While these commitments are a start, DE&amp;I initiatives are empty without a plan. But, with the proper framework and tools, procurement teams can start diversifying their supplier ecosystems and experiencing the inherent benefits of working with small business suppliers.</p> <h1>Supplier Reliability and Diversity Aren&rsquo;t Tradeoffs</h1> <p>A procurement team tasked with diversifying its company&rsquo;s supplier network must perform a careful balancing act. First and foremost, they must ensure that the company has access to the right goods and services when it needs them. For larger companies, this means finding suppliers with the resources to scale their business, which tilts the balance in favor of larger suppliers. Just as &ldquo;no one ever got fired for buying from IBM,&rdquo; procurement teams naturally seek to reduce risk by buying from larger, more established suppliers rather than smaller alternatives that can provide a comparable product.</p> <p>Yet this tendency to seek out large suppliers to manage risk often conflicts with mandates to diversify a company&rsquo;s supplier ecosystem. While there are large suppliers run by women and people of color, the <a href="https://clutch.co/business-services/resources/supplier-diversity-small-business-statistics" target="_blank">vast majority of underrepresented suppliers</a> are small or medium-sized businesses. Procurement teams tend to steer away from working with smaller underrepresented suppliers, as it could mean a higher risk that the supplier won&rsquo;t be able to deliver. As a result, they stick with the safe option, and the promised supplier diversity fails to materialize.</p> <p>I saw this happen directly with my first company, Nourish Inc. We produced spill-proof bottles for children and toddlers, and during the early years, we had no problem meeting demand from smaller retailers. But when we had the opportunity to supply our product to a major food distributor, we couldn&rsquo;t pay for the cost of scaling because our cash was stuck in unpaid customer invoices. We were a completely free, no-interest bank to our customers. We had no other option but to turn down the major contract that could have taken our company to the next level.</p> <p>This experience taught me a valuable lesson: Most small suppliers don&rsquo;t go out of business; they <em>grow</em> out of business. The problem is that small businesses typically lack the capital and resources they need to scale, which creates a paradoxical situation where a small business becomes a victim of its success. This phenomenon hits minority-owned suppliers particularly hard and undermines sourcing diversification efforts. Fortunately, there are several steps procurement teams can take to support these businesses while diversifying their supplier network and minimizing risk.</p> <h2>How Procurement Teams Can Meet DE&amp;I Supplier Goals</h2> <h3>1. Be Honest About Payment Time</h3> <p>While it is common for many suppliers to submit net-30 invoices to their customers, the reality is that procurement teams rarely meet this timeline. Procurement officers should work with their accounts payable team to reduce the time to pay rather than paying net-whenever they want.</p> <p>Paying suppliers faster will help them grow their business while simultaneously reducing the risk of non-delivery. However, finance teams are incentivized to hold onto company cash as long as possible and that means delaying payments. If payments cannot be accelerated, be honest with suppliers about the likely time to wait for payments to arrive and educate them about solutions they can use to get paid faster.</p> <h3>2. Clarify Supplier Contract Requirements</h3> <p>From types of insurance to certifications and delivery timelines, most large enterprises have very rigorous requirements for suppliers who want to do business with them. These requirements are often buried deep in the company&rsquo;s website &ndash; if they&rsquo;re online at all &ndash; which makes it difficult for suppliers to vet themselves before submitting a bid. By making supplier requirements more accessible, procurement teams limit the risk of contracting with an unprepared supplier while ensuring potential suppliers have all the necessary information to submit a strong bid.</p> <h3>3. Make the Sourcing Decision-Making Process Transparent</h3> <p>It is often unclear to SMBs how procurement decisions are made in large enterprises. To ease the process for suppliers, buyers and procurement organizations should increase visibility to the decision-making process, lifting the curtain on the sourcing process. Efforts that small and diverse suppliers currently spend ferreting out the right person to talk to can instead be spent preparing a contract bid, completing the preparation steps to qualify as a supplier or searching for other customers that are a better fit for their business.</p> <h3>4. Use Curated Supplier Networks</h3> <p>A significant challenge for procurement teams is finding a diverse supplier for their business that fits its parameters and that can deliver at the required scale. While supplier databases exist, most procurement teams do not have the bandwidth to perform due diligence on thousands of potential diverse suppliers.</p> <p>Working with both diverse suppliers and with enterprise supplier diversity teams, my team saw the profound need for a network that creates intelligent connections in real time between procurement teams and diverse suppliers with the readiness to deliver at an enterprise&rsquo;s specified scale and that develops the diverse suppliers&rsquo; readiness.</p> <h3>5. Create a Supplier Apprentice Program</h3> <p>Suppose a procurement team finds a supplier that they like but that isn&rsquo;t quite ready to meet the demands of their organization. In that case, they can still give them a boost while diversifying their supplier network by connecting them with some of their other suppliers. This creates an opportunity for the small supplier to become a subcontractor for a larger supplier to the enterprise.</p> <p>Through this subcontractor role, the smaller supplier can grow their business while simultaneously getting exposure to the requirements of the larger enterprise. This has the function of a &ldquo;supplier apprentice program&rdquo; that will help smaller suppliers prepare to become larger suppliers to a business in the future.</p> <h2>The Bottom Line</h2> <p>Large enterprises are sincere in their desire to help level the playing field for small and underrepresented businesses. While many offer a variety of programs, including grants, technical assistance and mentoring, nothing levels the playing field in a sustainable way as buying from them.</p> <p>Of course, not every solution will work for every business. The strategies chosen by a procurement team will depend on their unique situation, but both procurement teams and suppliers will benefit by leveraging these tips. When procurement teams commit to diversifying their suppliers and meeting DE&amp;I goals, there is a positive ripple effect: promises are fulfilled, requirements are met, diverse perspectives and products are introduced, small businesses prosper, the public approves and customers are happy.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/supplier-diversity" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Supplier Diversity</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/diversity-and-inclusion" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Diversity and Inclusion</a></div><div class="field-item even" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="How Procurement Teams Can Diversify Suppliers And Manage Risk - Future of Sourcing" addthis:url="http://futureofsourcing.com/how-procurement-teams-can-diversify-suppliers-and-manage-risk"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Fri, 29 Jul 2022 02:00:00 +0000 Laura Hodgson 2209 at http://futureofsourcing.com http://futureofsourcing.com/how-procurement-teams-can-diversify-suppliers-and-manage-risk#comments Back to the Future: Intelligent Supply Chain Planning http://futureofsourcing.com/back-to-the-future-intelligent-supply-chain-planning <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Intelligent-Supply-Chain-Planning.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Intelligent-Supply-Chain-Planning.jpg" title="Factors that businesses need to take into account when overhauling their own supply chain management processes." class="colorbox" rel="gallery-node-2208-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Intelligent-Supply-Chain-Planning.jpg?itok=8fX4SwFY" width="624" height="325" alt="Factors that businesses need to take into account when overhauling their own supply chain management processes." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p>With supply chain disruptions continuing to roil business and consumer markets, getting back to normal won&#39;t happen on its own without a change in processes and technology says Dave Food, Head of Supply Chain at <a href="https://www.board.com/en" target="_blank">Board International</a>. He shares the three key factors that businesses need to take into account when overhauling their own supply chain management processes.</p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/real-time-risk-intelligence-the-antidote-to-supply-chain-disruptions">Real-Time Risk Intelligence: The Antidote to Supply Chain Disruptions</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>The recent domino effect of disruptions, such as Brexit, the pandemic and the war in Ukraine, has inevitably resulted in a huge strain on business&rsquo; supply chains. It&rsquo;s a difficult landscape to navigate, but disruption is a fundamental part of the supply chain and organizations should be taking measures to mitigate these challenges.</p> <p>Today, most supply chains have some element of protection built in to combat disruption, whether that be extra capacity, extra inventory, alternative suppliers or different routes to market. The problem is, from source to consumption point, disruptions are impacting multiple routes of the supply chain in multiple locations. The existing protection isn&rsquo;t enough.</p> <p>Combine these challenges with the call for more sustainable practices to be adopted throughout the supply chain, and businesses are facing a complete overhaul of operations to stabilise stock flow and meet customer demands. By leveraging technology such as intelligent planning, encompassing scenario planning, businesses can build additional resilience before disruption happens. In our fluctuating economy, companies must be strategic and flexible in their approach.</p> <p>There are three key factors that businesses need to take into account when overhauling their own supply chain management processes.</p> <h1>1. Prioritize Data-Driven Insights</h1> <p>Many businesses are still siloed, with different departments managing different sets of unstructured data in different Excel sheets. This prevents business leaders from having a holistic understanding of the organization and its performance.</p> <p>There is a huge opportunity for businesses that bring together their data &ndash; and not by creating a mega-spreadsheet! Data is one of a business&rsquo; greatest, lowest-cost assets, which can be leveraged to gain a comprehensive picture of the organization and used to make informed decisions. The age of trusting your gut has passed, paving the way for the decade of data.</p> <h2>2. Seeing the Future</h2> <p>We can only make decisions based on what we know. Take the recent rail strikes for example: these were announced weeks in advance, meaning businesses could adapt their operations to take into account that some staff would not be able to get into the office.</p> <p>Meetings have been rescheduled and working from home organized, saving employees time and stress and preventing further disruption to organisations. When business leaders know where they stand and where they want to be, they can plan the optimal route to get there.</p> <p>The key is generating maximum visibility, not just from the business&rsquo;s own supply chain, but from key partners and customers too. Enlarging the business&rsquo;s peripheral vision to be able to make a data-driven decisions could save organizations lots of money. Apply that across the tens and hundreds of decisions being made in organizations every day, and suddenly profit margins have increased.</p> <p>A retailer, for example, might have a product that is hugely popular and is considering whether to increase stock in-stores. Intelligent planning, however, shows that in-store sales are significantly lower than online sales, which equate to 90% of the total purchases. The retailer can adapt its approach to stockholding, saving time, resources and money by truly understanding its target customers&rsquo; shopping trends.</p> <p>The way to achieve this level of insight is via predictive planning, which can turn historic data into predictions without the significant time and effort required by traditional analytics solutions. Input the scenario and instantaneously view the impact that that situation will have on the business and uncover unexpected insights.</p> <h2>3. Account for Change</h2> <p>Sustainability must be embedded into the supply chain over the next five years. Consumers are calling for it, businesses are planning for it, and, most importantly, the world needs it. In the U.K.,<a href="https://www.statista.com/statistics/1056522/sustainable-shopping-behavior-of-uk-shoppers/" target="_blank"> 34% of shoppers</a> choose to shop from brands that have environmentally sustainable practices and values.</p> <p>Given the increased consumer focus on <a href="https://futureofsourcing.com/sustainability-goals-will-be-driven-by-innovation" target="_blank">sustainability</a>, I expect that the measurement and evaluation criteria around ESG will become more stringent and internationally aligned, as pressure rises across the globe. To prepare, business leaders need to be able to simulate different decisions to understand which course of action will have the greatest impact; help them demonstrate the results of ESG initiatives, particularly across their supply chains; and avoid accusations of greenwashing.</p> <p>To become more sustainable, supply chains will have to change dramatically. In order to make major operational sustainability changes, business leaders first need to understand their existing supply chain model. Intelligent planning can show how efficient different components of the supply chain are and outline areas for improvement. With this understanding, leaders can make informed decisions about where more sustainable practices can be adopted.</p> <p>The overarching message is simple. Businesses need to plan and prepare for disruption. If every business took intelligent business planning and collaboration seriously, it would still take five to 10 years for the supply chains to fully rebalance, returning to a stable condition. Until we reach this point, disruptions will continue and businesses will need to prepare to be flexible. It&rsquo;s time to leverage historic data; to intelligently plan for the future.&nbsp;</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/digital-transformation" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Digital Transformation</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Back to the Future: Intelligent Supply Chain Planning - Future of Sourcing" addthis:url="http://futureofsourcing.com/back-to-the-future-intelligent-supply-chain-planning"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Wed, 27 Jul 2022 02:00:00 +0000 Dave Food 2208 at http://futureofsourcing.com http://futureofsourcing.com/back-to-the-future-intelligent-supply-chain-planning#comments Four Resolutions for Supply Chain ESG Management http://futureofsourcing.com/four-resolutions-for-supply-chain-esg-management <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Four%20Resolutions%20for%20Supply-Chain%20ESG%20Management.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Four%20Resolutions%20for%20Supply-Chain%20ESG%20Management.jpg" title="In order to improve ESG performance, organizations must be more open about reporting ESG risks." class="colorbox" rel="gallery-node-2166-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Four%20Resolutions%20for%20Supply-Chain%20ESG%20Management.jpg?itok=UbcyD2kM" width="624" height="325" alt="In order to improve ESG performance, organizations must be more open about reporting ESG risks." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p>In order to improve ESG performance, organizations must be more open about reporting ESG risks, disclose ESG metrics in line with industry peers, find a way to track hard-to-find metrics like supplier diversity, and tap technology to improve ESG governance and risk management says Riskonnect CEO&nbsp;Jim Wetekamp. He shares four&nbsp;ESG supply chain considerations for every risk and sourcing leader who wants to proactively improve ESG performance.</p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/three-tips-for-dealing-with-pandemic-driven-risk">Three Tips for Dealing with Pandemic-Driven Risk</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>The pressure is on to strengthen environmental, social and governance (ESG) performance. ESG factors influence a multitude of critical decisions &ndash; from where <a href="https://www2.deloitte.com/global/en/insights/topics/strategy/trust-in-corporate-climate-change-commitments.html" target="_blank">people invest</a> to where they work. Indeed, 42% of consumers say they will only buy from <a href="https://www.ey.com/en_us/consumer-products-retail/us-future-consumer-index-7-how-to-satisfy-the-sustainable-consumer" target="_blank">brands that align with their values</a>. &nbsp;</p> <p>Maybe you have taken steps to integrate ESG into operations, but what&rsquo;s next? Given that two-thirds of the average company&rsquo;s ESG footprint <a href="https://www.mckinsey.com/business-functions/operations/our-insights/buying-into-a-more-sustainable-value-chain" target="_blank">lies with its suppliers</a> and nearly 90% of greenhouse-gas emissions <a href="https://www.mckinsey.com/business-functions/operations/our-insights/the-ceo-architect-of-the-new-operations-agenda" target="_blank">come from a company&rsquo;s supply chain</a>, the answer is simple: your third parties. Even small, incremental improvements on environmental and social factors within the supply chain can significantly improve your overall ESG performance.</p> <p>Here are four ESG supply chain considerations for every risk and sourcing leader who wants to proactively improve ESG performance.</p> <h1>1. Be More Open About Reporting ESG Risks</h1> <p>Everyone is <a href="https://www2.deloitte.com/global/en/insights/topics/strategy/trust-in-corporate-climate-change-commitments.html" target="_blank">leery of &ldquo;greenwashing</a>.&rdquo; Customers and stakeholders want to know that the companies they work for and do business with are being authentic in their commitments &ndash; and transparency is critical to delivering on expectations. &nbsp;</p> <p>While most ESG reporting today is voluntary, regulations are imminent. But don&rsquo;t wait for specific requirements to shake out. Be proactive and start reporting on the ESG metrics most important to your organization. Embracing transparency sends a signal to your stakeholders that you place a priority on being a good corporate citizen, have a plan to address any issues and are dedicated to improvement. Starting early will also give you a competitive edge once regulations inevitably roll out.</p> <h2>2. Disclose ESG Metrics in Line With Industry Peers</h2> <p>ESG performance is a major force in the investment world &ndash; specifically the access to and cost of capital. Today&rsquo;s investors are demanding credible ESG data to evaluate their options. Consider providing metrics similar to what your peers are reporting to help investors compare performance and make informed investment decisions.</p> <h2>3. Find a Way to Track Hard-to-Find Metrics Like Supplier Diversity</h2> <p>Diversity, equity and inclusion (DE&amp;I) is a key part of the social element of ESG. While corporate America has increased its awareness of workforce diversity, comparable data from global suppliers can be hard to come by.</p> <p>Differing local reporting requirements and definitions of what constitutes &ldquo;diversity&rdquo; may mean the data you need is simply not there. In that case, you will have to work with your suppliers to begin collecting the type of DE&amp;I data that you need in the form you require.</p> <h2>4. Tap Technology to Improve ESG Governance and Risk Management</h2> <p>Organizations serious about improving supply chain ESG will invest in technology to streamline and standardize the complex process of ESG data collection and analysis. The data you need could be scattered across myriad departments and locations. Gathering that data, staying on top of requirements, keeping track of policies and ensuring your supply chain partners are adhering to your standards is virtually impossible with decentralized systems like spreadsheets.</p> <p>Integrated software is instrumental in bringing ESG risk insights from across the extended enterprise into one place. The right platform can automatically pull relevant data you already collect from wherever it currently resides inside or outside your organization. Any missing information can be seamlessly added via supplier portals, third-party data feeds and more.</p> <p>Having real-time information in one place enables you to understand the full scope of your exposure and proactively manage ESG metrics in a way that will positively impact your operations, brand and stakeholders.</p> <h2>Start Early and Invest Big</h2> <p>The focus and scrutiny on ESG reporting will only intensify. As ESG becomes more ingrained in internal operations, executives will increasingly expand their focus to include supply chain partners. Start now to define the ESG metrics most meaningful to your organization and your industry. You will be ready for any future regulatory requirements &ndash; and will be well on your way toward earning the trust of your stakeholders.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/riskonnect" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Riskonnect</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div><div class="field-item even" rel="dc:subject"><a href="/tags/supplier-diversity" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Supplier Diversity</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/supplier-relationship-management-srm" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Supplier Relationship Management (SRM)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Four Resolutions for Supply Chain ESG Management - Future of Sourcing" addthis:url="http://futureofsourcing.com/four-resolutions-for-supply-chain-esg-management"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Wed, 29 Jun 2022 02:00:00 +0000 Jim Wetekamp 2166 at http://futureofsourcing.com http://futureofsourcing.com/four-resolutions-for-supply-chain-esg-management#comments Three Steps to Minimize Supply-Chain Disruptions http://futureofsourcing.com/three-steps-to-minimize-supply-chain-disruptions <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Three-Steps-Minimize-Supply-Chain-Disruptions.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Three-Steps-Minimize-Supply-Chain-Disruptions.jpg" title="With no foreseeable end date to supply chain disruptions, now is the time for organizations to examine the likelihood of interruptions and aim to get ahead of the problem before it takes hold." class="colorbox" rel="gallery-node-2181-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Three-Steps-Minimize-Supply-Chain-Disruptions.jpg?itok=fFOX608-" width="624" height="325" alt="With no foreseeable end date to supply chain disruptions, now is the time for organizations to examine the likelihood of interruptions and aim to get ahead of the problem before it takes hold." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>With no foreseeable end date to supply chain disruptions, now is the time for organizations to examine the likelihood of interruptions and aim to get ahead of the problem before it takes hold says Jim Wetekamp, CEO of <a href="http://www.riskonnect.com" target="_blank">Riskonnect</a>. He shares a three-step plan to build supply chain visibility, plan for various situations and the benefits of diversifying your supply sources.</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/three-tips-for-dealing-with-pandemic-driven-risk">Three Tips for Dealing with Pandemic-Driven Risk</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>Most businesses didn&rsquo;t anticipate having to handle the supply-chain impacts of several disruptive forces at once: an ongoing pandemic, a severe crunch for talent and Russia&rsquo;s invasion of Ukraine.</p> <p>Pandemic-driven shortages are still in full swing. New <a href="https://www.scmp.com/economy/china-economy/article/3172932/shanghai-port-operations-hit-citys-covid-19-outbreak" target="_blank">COVID outbreaks in China</a> are slowing the flow of goods into the U.S. The <a href="https://www.reuters.com/business/autos-transportation/us-companies-grapple-with-surging-costs-supply-chain-problems-persist-2022-02-25/" target="_blank">ongoing mass exodus</a> of supply chain and logistics workers continues to make it difficult for companies to keep up with demand. Russia&rsquo;s invasion of Ukraine compounds these challenges. Economic sanctions from Western countries are <a href="https://www.washingtonpost.com/business/2022/03/18/russia-ukraine-war-china-covid-supply-chain/" target="_blank">driving up global logistics costs</a> and lead times, exacerbating supply shortages.</p> <p>The odds of so many risk events coalescing are seemingly low. But the past few years have shined a spotlight on the interplay of risks. Every big risk event weakens you for any subsequent event, amplifying the damage and disruption.</p> <h2>What Could Come Next?</h2> <p>Europe is facing its worst migrant crisis since World War II as Ukrainian refugees flee to Poland and other neighboring countries. The rippling economic effects could tack onto current supply-chain pressures. The prospect of disruptive cyberattacks is also becoming more likely. Ransomware actors are <a href="https://news.yahoo.com/exclusive-ransomware-attacks-on-us-supply-chain-are-undermining-national-security-customs-and-border-protection-bulletin-warns-191403260.html" target="_blank">focusing their attention</a> on manufacturers&rsquo; supply chains, threatening to cripple already strained operations and undermine national security.</p> <p>At the same time, climate change and an uptick in damaging extreme weather events are threatening supply-chain resilience. Coastal flooding due to rising sea levels can lead to port closures, facility shutdowns and other logistical challenges.</p> <p>No matter what risk events lie in wait, there are ways to lessen the potential impact and speed your response time.</p> <h2>How to Act Now</h2> <p>There are three steps you can take today to bolster your supply-chain risk management capabilities.</p> <h3>1. Build Supply-Chain Visibility</h3> <p>Incomplete, scattered, or out-of-date information can leave you blind to what&rsquo;s coming and flat-footed when disruptions hit. Companies often work with an array of procurement and enterprise resource planning (ERP) systems, each home to different pieces of supplier, product and transaction data. These disparate technologies limit teams&rsquo; view of the supply base, which hinders the ability to make fast and confident decisions.</p> <p>Trustworthy data is table stakes for supply-chain risk management. Build visibility by getting all your supply-chain data &ndash; product quality, contracts, on-time delivery performance, supplier financial and cyber health, ESG metrics and more &ndash; in one place. Bringing all your information into one platform with relationship mapping capabilities gives you deep insight into supplier performance, potential risks and the impact each partner has on the organization. If a supplier is in poor financial standing, for instance, you can see your total risk exposure and quickly pivot before that supplier goes out of business.</p> <h3>2. Model Various Scenarios</h3> <p>If a major hurricane shuts down several key ports, how severe would the supply-chain interruptions be for your business? How quickly could you detect and respond to a cyberattack on your supply-chain operations? Could you handle both events if they happened at the same time? If you aren&rsquo;t confident in your organization&rsquo;s ability to withstand coinciding disruptions, now is the time to prepare.</p> <p>Scenario planning is an invaluable tool to up your game. Play out various potential risk scenarios to understand the impact each would have on your organization. Assess your ability to respond to multiple events at once and choose appropriate mitigations. It&rsquo;s critical to proactively look beyond daily risk exposures to prepare for more disruptive events and bigger abnormalities.</p> <h3>3. Diversify Your Supply Sources</h3> <p>COVID-19 highlighted the drawbacks of heavily relying on offshore supply-chain operations. Even still, companies&rsquo; <a href="https://www.bloomberg.com/news/newsletters/2022-04-04/supply-chain-latest-american-companies-are-overstocking" target="_blank">reshoring efforts have been slow</a>, and many supply chains still lean on distant supply sources.</p> <p>Supply-chain resilience hinges on having a diversified portfolio of suppliers to tap in the event your primary relationships can&rsquo;t deliver. If a port shutdown closes off a key supplier on the other side of the world, being able to identify and pull the trigger on an alternative supply source, possibly closer to home, is paramount. &nbsp;This will help protect the flow of goods when confronted by future pandemics, geopolitical issues and other major risk events.</p> <h2>The Interplay of Risks</h2> <p>Supply-chain hiccups are inevitable. What makes today&rsquo;s landscape especially challenging is the interplay of major risk events, including the pandemic, talent shortage, war and more. There will be more disruption. Build up your supply-chain and risk management capabilities now so you&rsquo;re ready for what could come next.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/enterprise-resource-planning-erp" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Enterprise Resource Planning (ERP)</a></div><div class="field-item even" rel="dc:subject"><a href="/tags/riskonnect" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Riskonnect</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/supplier-diversity" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Supplier Diversity</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Three Steps to Minimize Supply-Chain Disruptions - Future of Sourcing" addthis:url="http://futureofsourcing.com/three-steps-to-minimize-supply-chain-disruptions"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Mon, 30 May 2022 02:00:00 +0000 Jim Wetekamp 2181 at http://futureofsourcing.com http://futureofsourcing.com/three-steps-to-minimize-supply-chain-disruptions#comments ESG Risk Assurance – An Opportunity for Transparency and Trust http://futureofsourcing.com/esg-risk-assurance-an-opportunity-for-transparency-and-trust <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/ESG%20Risk%20Assurance.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/ESG%20Risk%20Assurance.jpg" title="Building trust in ESG practices is complicated by the lack of transparency and consistency in reporting practices, the pace of change in reporting requirements, and huge regional and corporate variations." class="colorbox" rel="gallery-node-2175-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/ESG%20Risk%20Assurance.jpg?itok=7D1XOGeW" width="624" height="325" alt="Building trust in ESG practices is complicated by the lack of transparency and consistency in reporting practices, the pace of change in reporting requirements, and huge regional and corporate variations." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Building trust in ESG is complicated by the lack of transparency and consistency in reporting practices, the pace of change in reporting requirements, and huge regional and corporate variations says Heather Moore, Sustainability Technical Director at LRQA. She shares how the right insight makes it possible to develop reporting practices that stand up to stakeholder scrutiny and future-proof businesses against ever-evolving regulations.</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/four-resolutions-for-supply-chain-esg-management">Four Resolutions for Supply Chain ESG Management</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>Customers, employees and investors are increasingly putting ESG front and center when making decisions about the companies they engage with. <a href="https://www.ft.com/content/e3b09230-1f52-4a79-a680-1532dffc4be8" target="_blank">Rising shareholder and consumer activism</a>, as well as new forms of regulation, mean that it is no longer enough to simply state good intentions. The challenge is to prove to stakeholders that policies and initiatives are translating into meaningful action and impact.</p> <h1>Setting Standards</h1> <p>The currency at stake is trust, arguably the most important asset of any business or brand. To establish trust, third-party corroboration is key.</p> <p>Standards set by bodies such as ISO have long been established as marks of trust and integrity. In the world of sustainability, verification and assurance standards such as WBCSD/WRI GHG Protocol, ISO 14064, SASB, and TCFD are widely recognised by investors and stakeholders and support the comparability and transparency of reported ESG data.&nbsp;&nbsp;</p> <p>The problem is that the material topics for each industry can be so varied that there are no globally recognized standards for many of the requirements. In fact, there is still much international debate on the definition of the word &ldquo;sustainable,&rdquo; which &ldquo;environmental&rdquo; measures should be tracked and what exactly &ldquo;social&rdquo; responsibility should cover. So how can businesses evaluate their performance against robust benchmarks?</p> <h2>Uneven Progress</h2> <p>The fastest progress being made is in the area of carbon tracking, with concerted efforts to establish agreement on measurement and science-based targets concentrated around UN climate change meetings and being driven by organizations such as CDP &ndash; a global non-profit that runs an environmental disclosure system for companies, cities, states and regions.</p> <p>At COP26 in Scotland, the International Sustainability Standards Board (ISSB) was launched as an independent, private-sector body that develops and approves IFRS Sustainability Disclosure Standards. This will undoubtably help to increase transparency when it comes to accounting, but it has been recognized by many observers, such as <a href="https://ssir.org/articles/entry/fixing_the_s_in_esg" target="_blank">Jason Saul</a>, Executive Director of the Center for Impact Sciences at The University of Chicago, that much of the focus on ESG performance to date has been on those outcomes that are most easily measured and quantified by the world of finance.</p> <p>For both social and environmental impact, there are many more activities and measures that go beyond the balance book, including health and safety, well-being and responsible sourcing. This is not just a question of compliance; many companies undertake pro-social policies and behaviors that positively impact lives and the environment. It is these actions that do the most to establish brand purpose, driving competitive advantage and business growth. However, such social impacts are often not widely measured in ESG data, leaving the &ldquo;S&rdquo; overlooked.</p> <h2>Defining Values</h2> <p>All businesses are at different stages on their journey and there is not a one-size-fits-all solution that can be applied. In the absence of global consistency, businesses can seek to establish an assurance strategy which takes into account their own progress as well as that of their industry and comparable sectors.</p> <p>Organizations that correctly identify material topics in its industry and develop internal policies against measurable targets and goals to reflect its declared values and position in its journey toward sustainability will generate trust with its stakeholders. They will also be able to demonstrate actions with progress audited against baselines that are set in line with its policies.</p> <p>Policies developed in this manner allow organizations to maintain visibility, not only of its own impacts, but also of its own suppliers and sub-contractors further down the chain. This provides an opportunity to prove wider positive impact and leadership beyond the immediate responsibility of an organization, while building stronger relationships with suppliers and establishing more agile methods of achieving quality and control.</p> <p>The process of operating to, and being independently audited against, these measures enable better monitoring, understanding and management of performance. This ensures that efforts are made in the right areas of the organization that will have the greatest positive impact.</p> <h2>Future-Proofing for Regulation</h2> <p>Businesses that can establish robust ESG auditing will be well placed to anticipate new regulation, without being shaped reactively by it. A good example of this is <a href="https://www.jdsupra.com/legalnews/eu-proposes-mandatory-human-rights-and-6081814/" target="_blank">the EU&rsquo;s proposed directive for mandatory human rights and environmental due diligence</a> across global value chains. The proposed directive could result in costly penalties for businesses and directors for non-compliance and include a civil liability regime to allow victims to sue companies for harm resulting from the company&rsquo;s failure to comply with diligence obligations.</p> <p>There is more reputational value in moving ahead of such initiatives, while still in their early stages, by demonstrating positive behavior before others follow suit in compliance. Designing and adapting risk assurance programmes based on expert knowledge of variations in international policy will protect these investments made in reputation once regulators and competitors catch up.</p> <h2>Don&rsquo;t Get Left Behind</h2> <p>To gain first-mover advantage, businesses that want to achieve the greatest return on their ESG strategy need to establish robust methods of measurement and assurance now. The alternative is to remain reactive, forced by regulators to move later, risking reputational damage and playing catch-up to remain competitive in an increasingly ESG-focused world.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/risk" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Risk</a></div><div class="field-item even" rel="dc:subject"><a href="/tags/governance" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Governance</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="ESG Risk Assurance &amp;ndash; An Opportunity for Transparency and Trust - Future of Sourcing" addthis:url="http://futureofsourcing.com/esg-risk-assurance-an-opportunity-for-transparency-and-trust"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Wed, 11 May 2022 02:00:00 +0000 Heather Moore 2175 at http://futureofsourcing.com http://futureofsourcing.com/esg-risk-assurance-an-opportunity-for-transparency-and-trust#comments Sustainability Goals Will Be Driven by Innovation http://futureofsourcing.com/sustainability-goals-will-be-driven-by-innovation <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Sustainability-Goals-Will-Be-Driven-by-Innovation.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Sustainability-Goals-Will-Be-Driven-by-Innovation.jpg" title="Action must be taken now, across businesses of all sizes, to reduce their carbon emissions and remove waste from the supply chain." class="colorbox" rel="gallery-node-2167-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Sustainability-Goals-Will-Be-Driven-by-Innovation.jpg?itok=xDRZWo8P" width="624" height="325" alt="Action must be taken now, across businesses of all sizes, to reduce their carbon emissions and remove waste from the supply chain." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Evolving customer needs are influencing business and buying decisions, says&nbsp;Debbie Shakespeare, Senior Director of Sustainability, Compliance, and Core Product Line Management at Avery Dennison RBIS.&nbsp;She makes the case for why action must be taken now, across businesses of all sizes, to reduce their carbon emissions and remove waste from the supply chain.</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/the-technologies-driving-esg-focused-supply-chains">The Technologies Driving ESG-focused Supply Chains</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>Consumer attitudes toward sustainability have been intensified by the pandemic. Global lockdowns caused a temporary reduction of industry and transport, and consumers noticed the benefits this had on their environment. As such, the pandemic provided a reckoning moment and spurred hope for the future of the environment. Even as normal activity resumed in Q3 2020, these intentions to implement change remained.</p> <p>One eye-opening stat from an August 2021 survey revealed that <a href="https://www.elavon.co.uk/news/2021/consumers-seek-ethical-and-local-brands-digital-payments-are-on-the-rise.html" target="_blank">90% of British consumers</a> plan to buy from eco-conscious brands going forward. This emulates just how dedicated consumers are to making responsible decisions that will benefit the environment in some shape or form, enabling them to live more circularly.</p> <p>In a report commissioned by Avery Dennison RBIS, conducted with GWI, it was revealed that globally, over 60% of fashion buyers wanted more transparency about where their clothing had come from and how it was made. This report demonstrated how eager consumers are to reduce waste and support more circular models for living.</p> <p>Further, this consumer survey also found that 62% of global fashion shoppers want brands and retailers to make end-of-life options accessible for their products. As it stands, the majority of brands lose visibility of what happens to a garment when it leaves their store, yet this research helps demonstrate that consumers still hold them accountable, post-purchase. 62% of shoppers said that brands and retailers should make end-of-life options available for their products, with 58% saying that fashion brands should help people mend items and a similar number wanting brand support in re-sale.</p> <p>It&rsquo;s no secret that evolving customer needs are what influence business decisions, particularly in retail. Ignoring this focus on eco-consumerism runs the risk of losing otherwise loyal customers who want to live more sustainably. As we saw from 2021&rsquo;s COP26 coverage, action must be taken now, across businesses of all sizes, to address customer preferences.</p> <p>The pressure is mounting on businesses to do everything in their power to reduce their carbon emissions and remove waste from the supply chain. Then they must go one step further and educate the public on their achievements and sustainability goals. This is critical. Without this, customers will simply overlook the brand.</p> <h1>Being Held Accountable</h1> <p>Setting sustainability goals requires a new way of thinking, as well as a level of transparency and collaboration across businesses and throughout supply chains. For so long, brands have been accused on greenwashing when they market their sustainability story. Now, they&#39;re trying to switch to authenticated data and be more transparent.</p> <p>The challenge is that when working across a long, complex international supply chain, it&rsquo;s sometimes difficult to reveal everything, particularly in such a competitive market. The answer will be working together and taking a region-specific approach rather than going at it alone. It is only by bettering one another that we will reach the collective goal. Delivering on sustainability goals requires an adaptation of thinking, for example a focus on doing more with less, or developing innovative new products that will instigate change.</p> <p>It is innovation that has underpinned Avery Dennison&rsquo;s deep-rooted ESG strategy, and we recognise that accountability matters. In October 2021, we announced that our emissions reduction targets were approved by the <a href="https://sciencebasedtargets.org/" target="_blank">Science Based Targets initiative</a> (SBTi) as consistent with levels required to meet the goals of the Paris Agreement. This acknowledgment by the SBTi gives us confidence that we are setting ambitious scopes for emissions reduction targets, as we strive towards net-zero emissions, which we aim to achieve by 2050.</p> <h2>A United Front</h2> <p>As a large, global operation, we truly understand the value that linking with other players, small and large, who are demonstrating a niche industry specialism, has in enabling us to collectively address the issue of sustainability.</p> <p>Across our RBIS business, we work with countless businesses that specialize in the apparel manufacturing and fashion retail sectors. Together, we can help them take action and actively remove carbon from their supply chains via the use of data and digital tools.</p> <h2>The Time for Change&nbsp;</h2> <p>Businesses know they must track and report emissions if their sustainability strategies are to be credible. Pioneering brands like Patagonia and Allbirds are leading the way when it comes to enforcing positivity via regenerative agriculture.</p> <p>Other labels, including Reformation, have demonstrated their commitment to the environment by ambitiously and publicly pledging for climate positivity by 2025, and are on a journey to become <a href="https://www.vogue.com/article/can-fashion-be-climate-positive" target="_blank">&ldquo;climate neutral certified.&rdquo;</a></p> <p>It is hugely positive to see so many brands realizing the time is now to make a change, and this is soon to be enhanced by mandatory ESG reporting, with new environmental laws imminent around the world. Businesses need to set their own ambitious targets and assess how these can be achieved. This means exploring the potential of new technology and smart ideas, for the good of the planet.</p> <p>The commitment within the apparel industry to make the change has been achieved. The next step is how we move beyond commitments and talk to a stage of heightened activity. We need decisions, solutions and action quickly, before it is too late.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/avery-dennison" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Avery Dennison</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Sustainability Goals Will Be Driven by Innovation - Future of Sourcing" addthis:url="http://futureofsourcing.com/sustainability-goals-will-be-driven-by-innovation"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Fri, 15 Apr 2022 02:00:00 +0000 Debbie Shakespeare 2167 at http://futureofsourcing.com http://futureofsourcing.com/sustainability-goals-will-be-driven-by-innovation#comments Digital Environmental Health and Safety Services Market is Set for Further Growth http://futureofsourcing.com/digital-environmental-health-and-safety-services-market-is-set-for-further-growth <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/Digital-Environmental-Health-Safety-Services-Market.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/Digital-Environmental-Health-Safety-Services-Market.jpg" title="Widespread corporate digitization, a focus on ESG and strategic pivots by leading consultancies to transform their service offerings with new technology is boosting the digital Environmental Health and Safety (EHS) services market." class="colorbox" rel="gallery-node-2163-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/Digital-Environmental-Health-Safety-Services-Market.jpg?itok=xTwGbXz_" width="624" height="325" alt="Widespread corporate digitization, a focus on ESG and strategic pivots by leading consultancies to transform their service offerings with new technology is boosting the digital Environmental Health and Safety (EHS) services market." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Widespread corporate digitization, a focus on ESG and strategic pivots by leading consultancies to transform their service offerings with new technology are boosting the digital Environmental Health and Safety (EHS) services market says Bill Pennington,&nbsp;who leads the Verdantix Environment, Health &amp; Safety practice. Now that C-level executives are starting to view EHS as an essential investment across all industry sectors, he shares the growth outlook for EHS services&nbsp;across a wide range of industry risk profiles.&nbsp;</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/procurements-increasing-csr-role">Procurement’s Increasing CSR Role</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>The market for digital environmental health and safety (EHS) services has come through a period of uncertainty in the industrial world. Firms have struggled with the difficulties of the pandemic while trying to address pressing new priorities such as the climate crisis and the ESG boom.</p> <p>Uncertainty in the industrial world has benefited EHS consultancies with last year seeing an increase in spend on EHS-focused digital technology implementation, EHS platform integration and data analytics services even though the COVID recession is still affecting budgets.</p> <p>Verdantix&rsquo;s report<strong> <em><a href="https://research.verdantix.com/report/market-size-and-forecast-digital-ehs-services-2021-2026" target="_blank">Market Size and Forecast: Digital EHS Services 2021 &ndash; 2026</a></em></strong> reports that the market hit $2.7 billion in revenues at the close of 2021 compared with $2.4 billion the previous year even though the COVID-19 pandemic is still a major issue worldwide.</p> <p>Growth last year was ahead of previous forecasts highlighting the strength of the sector with expansion driven by factors including widespread corporate digitization, the focus on ESG and strategic pivots by leading consultancies to transform their service offerings with new technology.</p> <p>The traditional powerhouses of North America and Europe remained the largest EHS digital services spenders while the very high-risk EHS segments, such as oil and gas and mining, retained the highest market share. But the next five years could see growth in other regions as well as growth across the whole gamut of industries&rsquo; risk profiles.</p> <h1>The Next Five Years</h1> <p>The market is seeing an increase in digital services budgets across a wide range of industry risk profiles. As the lingering effects of the pandemic fade, we forecast the market will grow to $3.8 billion by 2026.</p> <p>The market spend of firms within the high- and medium-risk industry verticals is likely to grow at the fastest rate compared with the very high-risk sectors. This reflects the growing adoption of EHS technology outside the traditional oil and gas, mining and chemical top spenders, as C-Level executives start viewing EHS as an essential investment across all industry sectors.</p> <p>The risk profiles of the firms engaging in large EHS technology projects will expand to include a higher percentage of high- and medium-risk industries, such as construction and manufacturing. Potentially power utilities, ports and airports, maritime, airlines, forestry, and pulp and paper could also see growth.</p> <p>Many firms in these sectors are evolving from unsophisticated EHS processes, carried out on paper or excel, and are directionless on how to execute their digitization strategy. As a consequence, they are turning to the expertise and support of consultants to guide them through EHS technology road mapping, management of change strategy, as well as technology implementations and maintenance of solutions.</p> <p>COVID-19 has not gone away and will limit the compound annual growth rate (CAGR) of the market but the pace of expansion will speed up and take a steeper trajectory with a CAGR of 9% between 2024 and 2026.</p> <p>As corporate appetites for EHS digital solutions continue to grow the services market will continue to expand. North America will maintain its position as the highest regional spend for digital EHS services but emerging regions such as LATAM, APAC and the Gulf States are primed for quick growth. These regions will experience rapid growth as EHS software availability and demand increases and new technologies become increasingly accessible to these fast-growing economic markets.</p> <h2>The Sector View</h2> <p>EHS software implementation services are expected to remain the service line where most spending is concentrated. In part that is due to spending by mid-market firms to drive greater levels of efficiency and more insightful outputs.</p> <p>In addition to software, other EHS technology implementations will see strong growth making it the fastest growing revenue stream. Companies are increasingly investing in technology, such as EHS mobile applications to drive safety culture and connected devices used to mitigate specific high-risk hazards within the workplace. Digital services will be central for firms to consolidate EHS software and technology projects.</p> <p>System integration and data analytics revenue streams will take a bigger market share as enterprise-level firms look to link new IoT EHS technology within their portfolios to form connected platforms. Several service providers have already made EHS integrations their primary digital offerings.</p> <h2>The Future is Bright</h2> <p>The economic hangover of COVID-19 is lingering and the global economy&rsquo;s K-shaped recovery pattern is expected to continue throughout 2022, with a number of industries, such as airlines and oil and gas still set to struggle.</p> <p>Last year also saw firms under increased regulatory and public pressure to address their environmental footprints. The tumultuous period has taught firms much about the integrity of their business infrastructure.</p> <p>Firms have accelerated EHS digitization strategies to strengthen their business resilience, with unprecedented levels of EHS technology pilot projects.</p> <p>Ultimately, uncertainty bred by nascent technology initiatives and challenges will see the demand for digital EHS services continue to grow, as firms rely on the subject-matter expertise and technical astuteness of consultancies to support projects.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Digital Environmental Health and Safety Services Market is Set for Further Growth - Future of Sourcing" addthis:url="http://futureofsourcing.com/digital-environmental-health-and-safety-services-market-is-set-for-further-growth"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Wed, 06 Apr 2022 02:00:00 +0000 Bill Pennington 2163 at http://futureofsourcing.com http://futureofsourcing.com/digital-environmental-health-and-safety-services-market-is-set-for-further-growth#comments Happening Now: 5 Important Procurement Trends http://futureofsourcing.com/happening-now-5-important-procurement-trends <div class="field field-name-field-image field-type-image field-label-hidden"><div class="field-items"><div class="field-item even" rel="og:image rdfs:seeAlso" resource="http://futureofsourcing.com/sites/default/files/articles/5%20Important%20Procurement%20Trends.jpg"><a href="http://futureofsourcing.com/sites/default/files/articles/5%20Important%20Procurement%20Trends.jpg" title="5 trends of top-performing procurement teams and how technology helps them maintain a competitive edge." class="colorbox" rel="gallery-node-2148-4WTLWrLPKOU"><img typeof="foaf:Image" src="http://futureofsourcing.com/sites/default/files/styles/juicebox_medium/public/articles/5%20Important%20Procurement%20Trends.jpg?itok=AlczhYgF" width="624" height="325" alt="5 trends of top-performing procurement teams and how technology helps them maintain a competitive edge." title="" /></a></div></div></div><div class="field field-name-field-intro field-type-text-long field-label-hidden"><div class="field-items"><div class="field-item even"> <p><em>Procurement teams are still facing challenges like supply disruptions and managing cash flow, says Mohammed Kafil, a procurement consultant with Kissflow Procurement Cloud. He outlines five trends of top-performing procurement teams and how technology helps them maintain a competitive edge.</em></p> </div></div></div><div class="field field-name-field-related-news field-type-entityreference field-label-above"><div class="field-label">Related news:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/top-5-strategies-to-improve-supplier-relationships">Top 5 Strategies to Improve Supplier Relationships</a></div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even" property="content:encoded"> <p>COVID-19 changed the world as we once knew it. While every business activity was affected in one way or another, procurement processes suffered the most as restrictions on the movement of people and goods wreaked havoc on supply chains around the world.</p> <p><a href="https://www.mckinsey.com/business-functions/operations/our-insights/resetting-supply-chains-for-the-next-normal" target="_blank">According to McKinsey</a>, 73% of CEOs stated COVID-19 caused challenges in their supply chain. COVID-19 had the most immediate and visible influence on these supply networks in terms of supply. Due to customer concerns regarding supply, there was a noticeable spike in demand for specific items.</p> <p>This worsened problems that were already prevalent across the supply chain, resulting in true supply stress. As a result, challenges emerged like demand and supply concerns, managing cash flow and working capital, sustaining profitability and assuring access to crucial commodities.</p> <p>These pandemic-driven disruptions taught us to adapt with the help of new strategies and technologies. Here are the five most important procurement trends that successful organizations are embracing to mitigate procurement challenges.</p> <h2>1. Digital Procurement</h2> <p>The emergence of digital technologies like <a href="https://kissflow.com/procurement/procure-to-pay-solutions/" target="_blank">procure-to-pay software</a> and their influence on procurement has been forecasted as a procurement trend for quite some time. However, COVID-19 made it evident that our procurement processes critically require the use of technology to help businesses reap numerous benefits.</p> <p><a href="https://www.thehackettgroup.com/news/digital-transformation-helping-procurement-do-more-with-less/" target="_blank">According to a Hackket Group report</a>, procurement will make significant investments in cloud-based business applications and data management technology, including data visualization, master data management and advanced analytics.</p> <p>The adoption of spend optimization analytics and dashboarding is also increased. As a result, the deployment of e-procurement technologies is predicted to roughly double in the next several years.</p> <p>The use of mobile computing and robotic process automation (RPA) has also skyrocketed, reflecting a shift toward more efficient, flexible procedures across the procurement lifecycle. As a result, RPA has the fastest adoption rate among digital technologies, with a growth rate of 2.3x.</p> <h2>2. Delivering Value Beyond Cost Savings</h2> <p>In 2022 and beyond, smart procurement will entail not just pursuing traditional cost-cutting objectives but also lifting the bar and demonstrating how it can generate real, concrete, genuine value.</p> <p>But questions may arise on how organizations are looking beyond cost savings and trying to deliver value through procurement. Generally, organizations prefer suppliers that can provide the opportunity to cut their costs while factors that actually create value &ndash; such as quality, compliance and time &ndash; are overlooked.</p> <p>Organizations have now realized that in order to achieve a competitive advantage in the market, they have to deliver what their customers expect of them. If you exceed your customer&#39;s expectations with the help of high-standard procurement processes, you are providing the value they are looking for.</p> <h2>3. Building a Trusted Supplier Base</h2> <p>COVID-19 taught organizations to build a trusted supplier base that they can rely on in unexpected situations. Suppliers are a crucial part of every supply chain and managing them is one of the top priorities of every business right now.</p> <p>People management and the additional value that human elements of the business provide to operations are at the heart of supplier management. Maintaining these relationships will guarantee that both parties work fast to fix issues, search for ways to enhance operations and assist each other in reaping the benefits of the connection.</p> <p>With a limited number of suppliers, it&rsquo;s imperative to try to build longer, stronger ties. This is a better deal than typical contract turnover. So, to get the most out of your supplier relationships, look for quality and reliability, value for money, and &ndash; most importantly &ndash; great service and clear communication from the start.</p> <h2>4. Change in C-Suite Perception About Procurement</h2> <p>According to a <a href="https://www.fronetics.com/procurement-isnt-strategic-enough/" target="_blank">procurement survey conducted in 2020</a>, 83% of executives said their procurement department isn&#39;t strategic. Prior to the pandemic, they didn&rsquo;t think procurement was critical to corporate leadership or that major input from the procurement department was required to make high-level strategic decisions.</p> <p>But now, the C-suite has realized the importance of procurement to their organization and is welcoming the input of their chief supply chain and procurement officers.</p> <p>The duty that lies on chief supply chain and procurement officers now is to recognize the board&#39;s priorities and deliver on them. To cope with the board&#39;s evolving goals, supply chain leaders must focus on increasing performance while controlling risks and pursuing new technology, products and services to build the business.</p> <h2>5. Procurement Sustainability</h2> <p>The year 2022 will be the year of procurement sustainability. Economic sustainability will be the focus for the coming year due to the world&#39;s economic problems caused by a global pandemic that forced almost all businesses to close for a time.</p> <p>More<a href="https://tcocertified.com/blog/what-are-the-positive-trends-in-sustainable-purchasing-right-now/" target="_blank"> nations are beginning to use their purchasing power</a> to force reforms toward a better market and environment by including environmental concerns in public procurement. As a result, public procurers are increasingly looking for products with ecolabels.</p> <p>On the business side, sustainability is no longer merely a hot topic; it is increasingly being explored independently or even incorporated into the company strategy.</p> <p>As consumers are now more aware of the green products and the deteriorating condition of the environment, they demand environmentally friendly products right from the start of the supply chain. Organizations that ignore the importance of sustainability in the supply chain will lag behind their competitors and fail to gain recognition from their consumers.</p> <h2>Conclusion</h2> <p>The world of procurement is evolving at a fast pace. The technological revolution has made procurement tools more useful, up-to-date and user-friendly, and provides a promising solution for unforeseen disruptions and risks. Procurement leaders around the world are learning from their past mistakes and evolving with the new trends to gain a competitive edge and stay on top of the market.</p> </div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Tags:&nbsp;</div><div class="field-items"><div class="field-item even" rel="dc:subject"><a href="/tags/kissflow-procurement-cloud" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Kissflow Procurement Cloud</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/environmental-and-social-governance-esg-0" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Environmental and social governance (ESG)</a></div><div class="field-item even" rel="dc:subject"><a href="/tags/supplier-relationship-management-srm" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Supplier Relationship Management (SRM)</a></div><div class="field-item odd" rel="dc:subject"><a href="/tags/robotic-process-automation-rpa" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Robotic Process Automation (RPA)</a></div></div></div><div class="field field-name-field-addthis field-type-addthis field-label-hidden"><div class="field-items"><div class="field-item even"><div class="addthis_toolbox addthis_default_style " addthis:title="Happening Now: 5 Important Procurement Trends - Future of Sourcing" addthis:url="http://futureofsourcing.com/happening-now-5-important-procurement-trends"><a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_linkedin"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_facebook"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_twitter"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_googleplus"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_pinterest_share"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_reddit"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_email"></a> <a href="https://www.addthis.com/bookmark.php?v=300" class="addthis_button_print"></a> </div> </div></div></div><div class="field field-name-field-region field-type-taxonomy-term-reference field-label-inline clearfix"><div class="field-label">Region:&nbsp;</div><div class="field-items"><div class="field-item even"><a href="/regions/global" typeof="skos:Concept" property="rdfs:label skos:prefLabel" datatype="">Global</a></div></div></div> Sun, 13 Mar 2022 17:00:00 +0000 Mohammed Kafil 2148 at http://futureofsourcing.com http://futureofsourcing.com/happening-now-5-important-procurement-trends#comments