Past Articles

“Strategic” sourcing revisited

When is sourcing truly strategic and can nepotism be a strategic sourcing objective?

By Bernie van Niekerk 

The word ‘strategic’ is regularly abused in organisations in order to add more gravitas to (or frighten people about) the potential impact of an issue or an intervention.

Examining the term strategic sourcing indicates that it must be something of great importance to the organisation to help meet its ‘strategic objectives’. In practice though, strategic sourcing is mostly linked to simplistic cost reduction efforts only.

 By: Staff writer

LearningandTechniques.PNGWith technology rapidly enveloping today’s world, organisations that fail to adjust their learning management practices and solutions often struggle with organisational growth or productivity. Leading organisations are abandoning traditional methods of learning in favour of more effective solutions, often involving technology innovation that engages talent and improves performance in the workplace. Smart Procurement Review looks at key trends affecting the future of enterprise learning.

By: Proudly SA

The past year has been tough on South Africa’s economy and the rand. Some economists predict an “increasingly weak” growth outlook and have forecast a difficult year ahead.

By: Dionne Kerr

It is never an acceptable option to simply tick the boxes of Enterprise and Supplier Development (ESD) – the same philosophy applies in all other elements of BEE. If it is not a sincere mechanism for running an effective, profitable South African business, then your model is wrong. It is time for change.

By Advocate Helen Venter 

Rainbow Civils CC v Minister of Transport and Public Works, Western Cape 2013 ZAWCHC 3 (6 February 2013)

By: Ndabeni Bagosi

Leading and forward-thinking organisations rely on the agility of their supply chains for sustainability. Traditionally, the focus of supply chain has been on compliance and cost cutting. However, increasing competition, changing customer needs and a changing economic environment are challenging organisations to think beyond costs.

By: Vivian Reddy

Current enterprise and supplier development (ESD) programmes select a group of small and medium enterprises (SMEs) to undergo screening and diagnostic processes. This results in an even smaller group of SMEs participating in a corporate ESD programme. While they all hope to secure a contract during or post programme, the reality is that only a few programme SMEs actually secure new or additional contracts. This raises the question: what are the primary aspects a corporate needs to get right to ensure that the outcome of an ESD programme is the definite awarding of a contract?

Book review

88 Secrets for greater procurement success

By Hanck van Laar 

Did you know that people who enjoy significant success in business did not become successful just by doing certain things, but rather by doing things in a certain way?

The same holds true for procurement: when done the right way procurement becomes so much more than just a support function to business.

By: Shawn Theunissen

Changes to the Broad-Based Black Economic Empowerment Codes have transformed enterprise development. Corporates now need to focus on the development of service providers already in their supply chains.

Career clinic

Assessing the vitals of your procurement and inbound supply chain career

By Chantal Kading

A trend I have seen from daily interaction within the procurement and supply management profession is that professionals take up the first available job versus a job that aligns with their career plans. The result for organisations is lower levels of engagement, productivity and staff retention. The effect for the individual is a lack of depth in skills, knowledge and competencies, affecting career longevity and ‘work-life-balance’.

By: Helen Venter

Case1
Mogale city - Defective tender evaluation process 

Case2
DDP valuers  - meaning of dispute resolution mechanismc created by SCM regulations 50 (Municipalities)  

Case law

Awarding tenders after the validity period lapsed

By Advocate Helen Venter 

Telkom SA Ltd v Merid Trading (Pty) Ltd and others; Bihati Solutions (Pty) Ltd and others [2011] JOL 26617 (GNP):

Commerciality in procurement 

What does this mean?

By Maria Lepore

Speaking at a quarterly status meeting, Maria Lepore advised Barclays Africa General Counsel that she is on a mission to recruit candidates for a few critical roles. General Counsel pointed out that the most important skill a sourcing professional must have is ‘commercial nous’, which basically boils down to commercial common sense or commercial understanding. Since that meeting, Lepore, Head of Africa Sourcing, has been researching how a sourcing professional can demonstrate commerciality. She shared her findings with SmartProcurement Review.

By: Howard Stephens

If your procurement policy was available on a website how many hits would it get? How many members of staff would check the policy on a suspicion that they had broken the policy looking for a justification for their actions? Other than procurement professionals and compliance officers, who has time to read the policy? When was the last time you looked at the policy yourself? Howard Stephens, former Chief Procurement Officer at Nedbank wonders if there could be a better way to make policy relevant to all? Having been a procurement leader who detailed and enforced policy, he now has time for some reflection. 

Andries Louw, Chief Director of the Eastern Cape Provincial Treasury, suggests a few mechanisms to ensure the growth and sustainability of small, medium and micro-sized enterprises (SMMEs) in the construction industry.

However, firstly, one needs to contextually understand the key challenges experienced by construction SMMEs.

Doing business with government

Validating advertised opportunities

By Andries Louw

There is a perception that government is an extremely complex organisation to deal with and its procurement systems are less than fair, equitable, transparent, competitive and cost-effective, as stipulated in section 217 of the Constitution. The reality is that many of these perceptions are created by the media’s presentation of the facts and the audit outcomes of various government institutions. The objective of this article is to assist suppliers to validate government business opportunities independent of media opinions or public perceptions.

dti on the new BEE Codes

“We are not the enemy”

Much criticism has been levelled at the dti over its New BEE Codes. Perceived by many as a legislator that has set an insurmountable bar, the dti says its drive for economic development has been lost in legislated translation. Liso Steto, dti, Director, spoke to Smart Procurement Review about supporting small businesses and ‘legislation fantasies’…

By: Pumezo Gulwa

South Africa’s government is by no means the only one in the world grappling with procurement modernisation. Globally, governments have been pursuing initiatives to
affect good governance and the “smart spending” of limited funds. In the last two decades, many countries, states and local governments have pursued the implementation of a more effective procurement system and, in many cases, an electronic procurement (e-Procurement) system.

Pumezo Gulwa, Director of the eCommerce Centre in the Office of the Chief Procurement Office, shares the lessons learned from international best practice and from National Treasury’s implementation of e-Procurement.

The lessons can be divided into a few key categories: people, process, cost control, technology, regulation and functionality.

Engaging in win-win supply chain negotiations

Pointers from global C-suite and director-level executives


By Professor Douglas Boateng 

Negotiation, a process where two or more parties engage with a view to reaching a mutually beneficial arrangement, is an increasingly important element of the supply chain management process.

It has been proven that good negotiation skills not only influence the outcome of specific transactions, but also significantly affect service providers’ and recipients’ abilities to build strong relationships and promote long-term, value-driven supply chain success. In addition, successful negotiations can lead to long-term engagement benefits for industry and society as a whole.

By: Vanitha Govendor

Government procurement and finance functions are faced with the need to achieve efficiencies while simultaneously reducing fraud and increasing control, transparency and auditability for all spend. At the same time these organisations are expected to constantly improve the services they provide
to the communities they serve. It is a tall order.

Factors that account for SMME failure in South Africa

By Dr Tumo Kele and Malefetsane Mohlakoana 

As South Africa continues to struggle with the sustainability of small entrepreneurs, some small, but very important, hurdles are still not sufficiently understood. However small they may look, these factors are at the macro level and require strong political and general business leadership.

Four common mistakes in Enterprise & Supplier Development

By Petra Rees 

The Enterprise and Supplier Development (ESD) element forms 40% of the revised B-BBEE scorecard. As a priority element it needs to be dealt with strategically, otherwise organisations may be discounted a level.

By: Amy Moore

Do you remember the game Operation? Players use metal tweezers to extract small plastic butterflies, spare ribs, and other ‘funny bones’ from a cartoon man’s body. If you make a mistake, the patient’s nose lights up with a little ‘zap’ and you lose your turn. While the zap is fun, the feedback does not really help you learn what to do better next time. As a result, the game gets boring quickly. And therein lies the problem with games that require no strategy: the players lose engagement.

Giving strategic direction to a province’s supply chain management

Compiled by SmartProcurement Review and the Western Cape Government

Emanating out of the supply chain management (SCM) modernisation for the Western Cape Government in 2009, the key focus to address SCM improvements was to identifya blueprint for the province that would:

  • Improve performance through the integration of policy and delivery
  • Enhance departmental capability to address strategic issues
  • Identify a more flexible deployment of resources to match priorities
  • Identify improved ways of working and more effective procedures for identifying and addressing skils gaps and training needs

 

By: Staff writer

The future of procurement is full of big ideas. Strategy. Collaboration. Transformation. But these high-level changes cannot happen unless the operational details at the heart of the function change as well. The nature and execution of day-to-day work, from sourcing materials to managing the supplier relationship and accounts payable, must evolve for procurement to become a driver of competitive advantage.

Government’s e-commerce aspirations

By Pumezo Gulwa and Moritz Botha 

The South African government is in the process of reforming supply chain management (SCM). It established the Office of the Chief Procurement Officer (OCPO) to modernise SCM, contribute to service delivery objectives and the developmental goals of government.

Green procurement as a vendor selection criterion

By Dr Myles Wakeham and Carl Wakeham 

As pressure mounts from government institutions, NGOs, consumer bodies and individual consumers throughout the world for organisations to produce goods that do not negatively affect the ecology, the question that arises is: to what extent are small, medium and large organisations in South Africa (and indeed the world) taking the ‘sustainable status’ of vendors into account when selecting them as suppliers?

Harnessing talent, managing change

Lessons from the 12th Barloworld Logistics supplychainforesight report

By Kate Stubbs

While transformation and progress have been features of the business world for decades, the pace of development and change has undoubtedly accelerated. New technology, new competitors, a hyper-connected and globalised system, and a vastly different consumer landscape are all key drivers of rapid and relentless change. The 12th annual Barloworld Logistics supplychainforesight report (conducted by research group Frost & Sullivan) sought to understand just how South African organisations are responding to this change and where the threats and opportunities lie.

How automation technology has enabled strategic procurement and compliance

Compiled by SmartProcurement Review and the Western Cape Government

Since early 2000 the Western Cape Government has maintained a centralised supplier database. Originally it was not mandatory for suppliers to register on the database, which forced departments to manage and maintain their own supplier databases to verify and/or validate supplier credentials and meet governance requirements. These databases were maintained in parallel to the Western Cape Supplier Database (WCSD).

By: Mediacy Mudekwa

Countless studies have established that the C-suite and boards of directors want their supply chains to become fully-fledged business functions and with the ability to influence organisational objectives or in the case of private sector, profitability. We have been here before, but what has been tangible proof of “from backroom to boardroom, procurement goes strategic”? How do you measure the true value of procurement’s influence on organisation strategy? The answer is a function of the level of influence supply chain teams have on overall organisation strategy.

By: Tendai Innocent Khumalo

The amended B-BBEE Codes of Good Practice, which came into effect in May 2015, first introduced the concept of ‘Empowering Suppliers’. The amended Codes define an Empowering Supplier as “a B-BBEE compliant entity, which is a good citizen South African entity, complying with all regulatory requirements of the country”. Yet this is a broad definition.

How to identify, manage and treat irregular, fruitless and wasteful expenditure

By Advocate Venter 

In managing and treating irregular, fruitless and wasteful expenditure (IFW) various oversight reports and internal and external audit reports have highlighted issues of non-compliance, weak controls and procedural and policy gaps.

By Tlale Mosimane 

Approaching the implementation of Enterprise Supplier Development (ESD) as a change initiative will not only ensure sustainable implementation, it will also ensure that the desired values to the ESD partners as well as to your organisations are achieved. Also, approaching it as a business strategy will eliminate the tendency to treat your ESD partners as just scorecard points, but as important value-adding partners to your business.

By: Stephen W. Bauld

Many companies no longer bid for municipal tenders or any government work at all. The general feeling is that it is just too much work, with very little return on investment, all owedto poorly written documents. “It is much easier to get work in the private sector” was the general response from the vast majority of people that spoke to Stephen Bauld during a recent construction event in Toronto, Canada.

Is funding the issue with failing SMEs?

By Daniel Hatfield 

A lack of adequate funding resources available to small and medium enterprises (SMEs) is often cited as the leading reason for failure. Granted, the landscape may seem daunting at first glance, however, when explored, it becomes evident that funding is not the fundamental issue, but rather a side effect of a greater problem facing the SME sector and the corporates supporting it. A simple solution is available.

By: Armin Moradi

We’ve all experienced that moment on a call when someone covers the crucial details of the conversation but is drowned out by
background noise.

By: Lerato Sithole

Faced with spending constraints, it has become critical for Chief Procurement Officers (CPOs) to unlock the value of emerging digital technology. Although local CPOs are under increasing pressure to rein in costs in a stagnant market, they are also being presented with a unique opportunity to embrace digital business processes and bypass inefficient legacy systems.

By: Nico Snyman

Project management is an integral part of any organisation’s service delivery, whether public or private. It is where the operational deliverables are measured. If not implemented, the result will be poor quality products, dissatisfaction with services and an organisation and project management team placed at risk.

Modes of learning for capacity building

By Ronald Mlalazi and Craig Voortman

Learning is a lifelong and ongoing experience and does not stop when we leave school, college or even university. Ongoing learning is the name of the game in our modern, fast-paced and ever-changing world. People acquire and impart knowledge in different ways; there is no single best mode of learning. The choice of learning mode is determined by various factors, such as time availability, distance constraints, work challenges, individual orientations, background, culture, perceptions, society, personal experiences and technology savviness.

By Maxi-lee Machado

Under the amended BEE Codes, EMEs do not need to produce a BEE certificate. The same is applicable to a QSE that is at least 51% black-owned: they need only obtain a sworn affidavit or a certificate issued by the CIPC confirming annual total revenue and the level of black ownership. However, for the public sector to allow for the use of affidavits, the PPPFA regulations will need to be amended as they require BEE certificates from all bidders on a tender. Maxi-Lee Machado, co-author of The Practical Guide to the Amended B-BBEE Codes of Good Practice, unpacks the conflict for SmartProcurement Review.

Procurement gets connected

By Marcell Vollmer

Today’s enterprise is more virtual than ever. And as the results of a new study reveal, procurement can fuel the collaboration needed to effectively manage it and achieve new levels of efficiency, agility and innovation - with the help of business networks.

By Lerato Sithole

South African CPOs have failed to take outsourcing to a greater level of maturity that would enable collaborating organisations to identify potential areas for import replacement manufacturing.

By: Prof PD Rwelamila

The electronic tolling (eToll) system on certain of South Africa’s Gauteng freeways has at a fundamental level been rejected by the public. Despite the South African National Roads Agency’s (SANRAL) insistence that information about the project has always been freely available, the South African public says SANRAL was not transparent about the project and the toll collection concession held by its Austrian privatesector partner Kapsch TraffiCom.

There is a need to create greater public awareness around how state-owned entities (SOEs) are applying supply chain management practices and good governance.

By: Lebogang Letsoalo

Without a doubt, Southern African companies are too behind to even think that they have reached a point where women’s skills are fully recognised within the industry. 

By: Helen Venter 

Recognising the benefits of other South African initiatives to reform supply chain management (SCM), the North West Provincial Treasury, in partnership with the National Treasury, embarked on an intensive process of changing the old backoffice culture of the previous procurement mechanisms into SCM as a strategic partner in government spending.

By: Petra Rees and Liso Steto

Q: At the launch of the Industrial Policy Action Plan (IPAP), Minister of Trade and Industry Rob Davies said that Industrial Policy is key for inclusive growth in the economy. How in your view, does the BEE Policy address inclusivity?

A: The BEE policy has as its intended beneficiaries those previously excluded from the South African formal economy i.e Africans, Coloureds and Indians. By assimilating these previously side-lined groups, who comprise more than 90% of the South African population, skills transfer takes place leading to inclusive economic growth. This enables the majority of the population to participate in the economic mainstream of South Africa.

By: Euan Granger

No other profession puts the word ‘strategic’ on their business cards. Euan Granger, Community and Content Manager for Procurious, wonders why we do so in procurement.

By: Garry Hertzberg

In business, there is often the occasion to enter into contracts that provide for permanency, to the benefit of both supplier and purchaser, providing stability and confidence to a business unit. In these cases it is common to conclude long-term or evergreen contracts. Often these agreements remain silent on the aspect of termination or duration.

Specialised suppliers have a competitive advantage

By Shawn Theunissen

Specialised suppliers are more likely to get the job, because they are more likely to get the job done well. This is the word from Property Point, a forward-thinking programme initiated by Growthpoint Properties that focuses on empowering suppliers.

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