Change

What kind of future-ready procurement leader is needed to survive a rapidly-changing business world? Only a few months ago, the stock market was looking strong and the ongoing trade war between China and the United States indicated future pressure on global supply chains. No one could have predicted that schools and universities would close, companies would tell their employees to work from home and people would be stockpiling toilet paper, of all things.

By Michael Healy, Supply Chain Partner

The outbreak of COVID-19 has forced companies to get creative about how they connect and meet with customers and teams.

Working with cloud applications allows us to workshop, design and configure systems remotely. With apps like Zoom and Microsoft Teams, working remotely can be easy and cost effective. But making it a positive and productive experience for everyone joining in does take some planning.

Here is a checklist from Supply Chain Partner to help you get the most out of your remote sessions:

To support supply chain professionals and to ensure that they have the resources they need to maintain supply chains during the coronavirus crisis, supply chain management professional body SAPICS has launched a number of special support initiatives to aid the profession. This includes a supply chain management toolkit, helpline and collaboration platform.

During Quarter 1 of 2020, the seasonally-adjusted Absa Purchasing Managers' Index (PMI) experienced its weakest quarterly performance since 2009. The PMI averaged at 45.9 index points, compared with 47.6 in Quarter 4 of 2019.

The weak quarterly outcome was despite the PMI improving to 48.1 index points in March 2020, from 44.3 index points in February. Nonetheless, the PMI still remained in contractionary terrain for the 14th consecutive month.

By Dr Marcell Vollmer, Chief Digital Officer, SAP Ariba

How does a Chief Procurement Officer measure success?
In the past, executives responsible for sourcing, contracting, purchasing and payment gauged success chiefly on their ability to wring savings out of the value chain. Without question, reducing costs remains as crucial today as ever. But, with the advent of digital networks, Chief Procurement Officers find that they now have an exponentially greater opportunity to create value. By linking together buyers and suppliers in real time, digital networks allow procurement leaders to foster collaboration, spur innovation and drive much of the strategic value that fuels growth.

These activities, of course, can benefit the balance sheet. But there are others, equally important, that a spreadsheet cannot easily capture.

The seasonally-adjusted Absa Purchasing Managers' Index (PMI) declined for a fourth consecutive month to reach 44.3 points in February 2020. The 0.9-point decline brought the index to its lowest level since the second half of 2009 when the economy started to recover from a deep recession triggered by the global financial crisis.

"At four points below the average reading in 2019, the current level is only six points above the lowest point reached in 2009", noted the Bureau for Economic Research (BER) in a statement.

What key steps can you take to limit the potential effects of the coronavirus on your organisation?

On 9 February, the world received news from China that it didn't want to hear.

The number of confirmed deaths from the coronavirus had overtaken that of the 2003 Severe Acute Respiratory Syndrome (SARS), with more than 1 000 casualties.

In addition to that, the virus is spreading at an alarming rate. There are now more than 40 000 confirmed cases. And this number is increasing with as much as 20% every day.

While the virus is terrifying from a public health perspective, it is also alarming in terms of supply chain. Wuhan, China, the epicentre of the virus and now a city in total lockdown and complete disarray, is one of the world's largest industrial hubs.

Procurious Founder, Tania Seary, takes a look at how the coronavirus is affecting global supply chains - and what you can do about it.

By Stephen Bauld

One might wonder why, as a consultant for over a decade, I would write about overpriced consultants. Being in this industry, I often hear stories about the high costs incurred when securing consulting services; these stories are widespread and frequent.

Indeed, it is surprising how many consultants are so sensitive to this issue. So much so that they actually make a point of declaring in their advertising material that "we are not going to charge you outrageous fees". Much of the adverse newspaper commentary in relation to the cost of consultants to government is exaggerated.

The seasonally-adjusted Absa Purchasing Managers' Index (PMI) started 2020 on the back foot and declined further in January. The PMI lost 1.9 points to reach 45.2 index points, the lowest level since September 2019.

The performance of the five major sub-components was mixed, with two indices recovering somewhat from multi-year lows reached in the previous month, and three declining in January.

By Sue Barrett, Founder, Barrett Consulting Group

Procurement, whether they are aware of it or not, is the epicentre of innovation and leadership of complex systems management within organisations and across supply chains. Or at least they should be...

The Purchasing Managers' Index (PMI) edged lower in December 2019 to 47.1 index points, down from 47.7 points recorded in November 2019. The December figure is about 1 point below the average recorded throughout 2019.

The PMI paints a bleak picture of the manufacturing sector's performance in 2019 as the headline PMI managed to edge above 50 points for only two months in the year. Bouts of load shedding, persistent weak domestic demand and more intense headwinds from the global economy likely weighed on activity during the year.

By Steven Powell
Director of Forensics at ENSafrica

Every organisation is susceptible to fraud, but some are more susceptible than others. This article provides an overview of the profile of a typical fraudster to help readers identify fraudsters operating in a business.

The seasonally adjusted Absa Purchasing Managers' Index (PMI) ticked down to 47.7 index points in November from 48.1 in October. The decline was broad-based as four of the five subcomponents of the headline PMI nudged down compared with the previous month.

Despite the decline, the average level of the PMI in October and November is still slightly above that recorded in Q3.

With Halloween just past, it is time to consider whether your boss is scarier than your average ghoul or if your career is in the grip of a scary, old-world Chief Procurement Officer (CPO) and thus doomed to wither...

Tania Seary, Founding Chairman of three companies specialising in the development of the procurement profession - The Faculty, The Source and Procurious - takes a look.

Irrespective of what you think about the way in which private- and public-sector procurement is conducted, the ultimate objective is the same. Creating 'value for money' is the most commonly used term among purchasing individuals.

Government procurement expert, Stephen Bauld, has spent half his career working with private-sector organisations and the other half working with various government agencies. He has come to realise that all procurement people strive to get the best deal that adheres to the policies and procedures of the organisation that they work for. In this month's SmartProcurement, Bauld takes a closer look at a career in procurement.

The seasonally-adjusted Absa Purchasing Managers' Index (PMI) rose to 48.1 index points in October 2019, up from 45.1 index points in September 2019.

The October level was slightly higher than the average of 47.3 recorded during Quarter 3 and in line with the average of 48.3 points recorded during the first nine months of 2019.

The October PMI release incorporated updated seasonal adjustment factors for all of the seasonally-adjusted indices.

Four of the PMI's sub-components improved from September, with only Inventories moving down.

By Bertrand Maltaverne

If there is one topic in business literature that has been covered exhaustively, it is key performance indicators (KPIs). But if you're not careful, the indicators you set might inadvertently encourage behaviours that can be dramatically damaging...

Case in point: in 19th-century India, the city of Delhi had a snake problem. A rather large population of cobras slithered the streets with impunity. The British government decided to get rid of the snakes through crowdsourcing. Officials offered a bounty for every dead snake that locals brought in. But something unexpected happened. Soon after the British started to pay for every dead cobra, they realised that local entrepreneurs had begun to breed snakes in order to get paid.

The government cancelled the programme. As a result, the cobra farmers released their worthless snakes into the streets.

It turned out that the British didn't want dead snakes; they just wanted fewer live snakes. By incentivising the wrong thing, they inadvertently doubled their problem.

The seasonally adjusted Absa Purchasing Managers' Index (PMI) declined to 41.6 index points in September, down from 45.7 in August. This was the second consecutive large fall in the PMI and brought the index more than 10 points below a recent high of 52.1 points reached in July 2019. At the time, the Bureau for Economic Research (BER) did caution that the robust July reading was unlikely to be sustained given weak underlying demand conditions.