Supplier Partnerships

What is affecting procurement? Where is the profession going?

 

DuncanBrock_SPW.jpgThere’s a lot going on. The changing and challenging times we currently face are probably greater than they’ve ever been. What is the implication for procurement? What do we need to keep abreast of and continually work on?

Duncan Brock, Director of the Chartered Institute of Procurement and Supply, offered his insights during his opening address at the SmartProcurement World Gauteng conference in September.

Gauteng uplifting SMMEs through procurement

 

MEC_BarbaraCreecy_SPW.jpgRecent studies by Stats SA indicate that the face of poverty in South Africa remains black, female and that of children below the age of 17. Furthermore, more than one in every two SA citizens can be officially classified as poor, said Gauteng Finance MEC Barbara Creecy at the Smart Procurement World conference in Johannesburg.

“[Stats SA’s] Poverty Trends Report shows that by 2015, approximately 33% of Gauteng’s citizens were living in poverty. Although this is lower than most of the country, it is not a cause for celebration. One in three Gautengers go to bed without a meal. The situation was further worsened by the province losing 146 000 jobs during the last financial quarter,” said MEC Creecy.

The most direct and effective route to address these socio-economic challenges is a programme of transformation, modernisation and re-industrialisation. Gauteng’s provincial government is currently implementing such a programme in partnership with the private sector, organised labour and civil society, said MEC Creecy.

Set suppliers up for success and mitigate preferential procurement risks

 

Even if organisations are not doing business with organs of state, they may well form part of the supply chain of organisations to which the PPPFA directly applies. Therefore, they need to be aware of its scope and provisions.

Corporate businesses are actively seeking and supporting black-owned and black woman-owned Exempted Micro Enterprises (EMEs) and Qualifying Small Enterprises (QSEs) as suppliers to meet the stringent Preferential Procurement Policy Framework Act (PPPFA) regulations.

If successfully implemented, this approach could stimulate the desired growth and economic transformation as the B-BBEE Act intended from the start, by providing greater opportunities for small, medium and micro enterprises (SMMEs), particularly those owned by historically disadvantaged South Africans (HDSAs).

“However, while this is positive, merely complying with the PPPFA is not going to guarantee the success of SMMEs: there are factors outside the control of regulations and policies that need out-of-the-box solution,” Terence Gregory, CEO of Ecsponent Limited, told SmartProcurement.

Turning supplier information into procurement insight

 

RudiKruger_2017.jpgDecisions and consequences go hand-in-hand. This is why having adequate, relevant information at your fingertips is a critical aspect of any decision-making process - more so when these decisions affect the operation of business and company reputation.

In procurement, the optimal goal is to manage risks and costs within a company, making it an imperative department of business. Businesses spend a significant amount of time vetting potential suppliers before embarking on a partnership, and pertinent data provides them with the right tools to make informed decisions with information that is easily interpreted by management.

However, the vetting system should not end when an agreement is reached between a business and its supplier. Intensive research and vetting on future and current suppliers should be a continual safety requirement to ensure all procurement legislation is adhered to, says Rudi Kruger, General Manager of Risk Solutions at LexisNexis Data Services, in this month’s SmartProcurement.

How can procurement prepare SMEs to engage with corporates?

 

ElmarieGoosen-HS.jpg“They won’t even talk to me, now” David said with a sigh, and to punctuate his mood, spread his hands on the desk in front of him in resignation.

David is a small supplier that was selected to participate in a corporate enterprise supplier development (ESD) programme. Following the completion of the 12-month contract, he was replaced by a subsequent beneficiary of the programme. David has been trying to secure a further contract with the organisation (and with other organisations), but has no idea how to engage with his prospective clients, subsequent to the ESD initiative.

It is a situation familiar to Elmarie Goosen, owner and founder of On Purpose, an organisation that provides training to SMEs to complement supplier development programmes – to prepare SMEs to engage with corporate procurement. She unpacks what procurement can do to help SMEs, in this month’s SmartProcurement.

Supplier transformation initiative in engineering and manufacturing to be introduced

 

manufacturing_engineering_support.jpgA transformation initiative for small businesses in engineering and manufacturing, the Empowered Engineering and Manufacturing Initiative (EEMI), will be launched in September.

The initiative is a collaboration between Smart Procurement World, the Absa Enterprise and Supplier Development Expo and the Steel and Engineering Industries Federation of Southern Africa (SEIFSA).

The initiative is positioned as a platform for industry players to share opportunities and challenges for small and medium empowered organisations, and drive enterprise and supplier development (ESD) partnerships (funding, training, mentoring and support) and other important focus areas in this sector.

Buy local or face audit findings!

 

RobDavies_ProudlySA.jpgUnder the World Trade Organisation’s agreement on Trade-Related Investment Measures, The South African government cannot prescribe to the business sector that they must follow localisation (75% local content in purchases) in the same way it prescribes to public entities.

“We don’t have that ability, and are challenged internationally [if the topic of localisation is broached with international organisations],” said Minister of Trade and Industry, Rob Davies.

However, some business organisations have embraced the spirit under which the Economic Development Department (EDD) negotiated the local content designations, to drive economic development in the country.

Minister Davies shared some of these corporate-level local procurement stories at Proudly SA’s Buy Local Summit, in early April.

Short-term SCM investment for long-term savings

IanNeilson.jpgThe City of Cape Town has leveraged its supply chain management policy to grow its economy, procure sustainably and create jobs. And save money, of course.

Opening the Smart Procurement World Western Cape Conference, the city’s Executive Deputy Mayor, Alderman Ian Neilson gave delegates an insight into the City’s supply chain efforts to create employment for Cape Town’s people, promote resource efficiency, reduce negative environmental effects, and promote the competitiveness of local businesses.

Supplier collaboration? You must be joking!

Mike_Robertson.jpgThere are numerous articles talking about the value that remains untapped within the supply chain, if only buyer and supplier could collaborate. But what does it mean to collaborate? wonders Mike Robertson, CEO of POD Procurement.

10 things you should consider before writing any supply chain policy

 

Musah.jpgWhen purchasing materials the same routines are used on each occasion, even if each and every one of these purchases is unique. So why do we need supply chain policies or procedures? asks Muddassir Ahmed, Divisional Supply Chain Manager at Eaton.

SA must partner with China to drive ESD through industry

 

Publiclecture1.jpgChina is an economic partner that can drive enterprise and supplier development (ESD) in South Africa and the rest of the continent.

A significant export, trade and development partner to Africa, China brings, particularly to South Africa, a host of industrial innovations, which if adapted for the local environment can help with various productivity and performance improvements, plus competitive advantage in the public and business sectors, said Prof Douglas Boateng, CEO of PanAvest International & Partners, at a public lecture in October.

Drones delivering blood for transfusions: Supply Chain Innovation

 

drones_.jpgA drone service delivering blood for transfusions has been launched in Rwanda.

The drones are expected to make between 50 and 150 life-saving deliveries each day to far-flung and inaccessible clinics across the western half of the country. Excessive blood loss during childbirth is the leading cause of death in pregnant women in Rwanda.

Zipline, the company behind the technology, said it could complete a delivery in around 30 minutes after receiving an order via a call or text message.

The low-hanging fruit has been picked. Now what?

 

JonathanHughes.jpgKraljic helped us pick the low hanging fruit, but the model is unlikely to drive the next wave of value, says Jonathan Hughes, Strategic Sourcing & Supply Chain Management Practice Leader at Vantage Partners, in this month's SmartProcurement.

Strategic sourcing rests largely upon a set of concepts and principles laid out by Peter Kraljic in his classic Harvard Business Review article "Purchasing must become supply management”, which was published in September 1983.

Creating supply chain value, not compliance, drives ESD success

 

Wybrand2.jpgThe developmental nature of ‘transformation’ becomes a complex process when we consider the overwhelming commitment within supply chains to receiving high-level quality, consistent delivery and cost effectiveness.

Such a commitment leads organisations to carefully evaluate the risks versus the benefits when implementing their ESD strategies. However, only from the vantage of a holistic overview will organisations realise that it is the ultimate goal of participation around value creation, and not compliance, that will empower ESD initiatives and emerging suppliers alike, writes Wybrand Ganzevoort, Managing Director of Collection Value Creations.

eThekwini municipality linking procurement and SMMEs

 

Fawzia.jpgHosting Smart Procurement World KwaZulu-Natal gave the city of eThekwini’s SMMEs the chance to network with big business procurement from the corporate and public sectors.

“Involving Procurement in assisting SMMEs to grow and creating new businesses generates jobs for citizens,” eThekwini Municipality Cllr Fawzia Peer, Chair: Finance & Procurement, told SmartProcurement.

“[Linking Procurement with small businesses] helps the municipality, in terms of poverty alleviation, and the State, in terms of less welfare support. Ultimately, it improves the quality of life of our people,” said Cllr Peer.

Port Elizabeth ED office signs supply agreements with Eastern Cape entities

 

Thumbnail image for KeaobakaMahuma.jpgAn Enterprise Development Centre (EDC) in Port Elizabeth has signed Memorandums of Understanding with Nelson Mandela Bay Municipality, Joe Gqabi Municipality, East London Industrial Development Zone and the George and Knysna municipalities to provide funding and business development support to SME suppliers that work with these entities.

Through the initiative, Absa, which has opened seven other EDCs around the country, aims to assist thousands of small and medium enterprises (SMEs) in the Eastern Cape, says KeaObaka Mahuma, Head of Enterprise and Supply Chain Development at Absa.


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