How effective are you at managing supplier risk and purchasing strategically?
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How effective are you at managing supplier risk and purchasing strategically? Ted Datta Strategic Account Director BvD UK & Ireland
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Transcript of How effective are you at managing supplier risk and purchasing strategically?
How effective are you at managing supplier risk and purchasing strategically?
Ted Datta
Strategic Account Director BvD UK & Ireland
1. What are the current challenges….
…facing the procurement industry
…and, the procurement professionals we know
2. Let’s focus on risk
3. Answering the “so-what” question…
SMEs continue to struggle across Europe
30,719 entered receivership in the last 2 weeks
11,371 manufacturing, construction, logistics, telecoms
520 + 50 employees
+7% vs LY
Leading car manufacturer
What are our clients saying?
“we need to harmonise risk scorecards with our credit insurers and finance systems…”
“we need to source in emerging markets and understand the risks involved…”
“our buyers don’t have time to waste trawling the net for information on suppliers…”
Global logistics provider
What are our clients saying?
“I’m sure we could be leveraging our buying power more effectively…”
“we need to stop creating duplicate suppliers, it’s wasting time and money…”
“if our suppliers don’t deliver, it’s our reputation at stake…”
Let’s focus on risk
“The effect of uncertainty on objectives”
Source: ISO
“25% of procurement functions have only a basic level of maturity around risk
management”
Source: KPMG
1. Financial risk – “continuity of supply”
2. Structural risk – “stability & sustainability”
3. Reputational risk – “ethical credentials”
What can business information help with?
1. Financial risk: a broader perspective
Probability of defaultPropensity of bankruptcy
Environmental risk Peer group stability
2. Structural risk: predicting supplier behaviour
Multi-national / Private Equity Lifestyle / Family vs.
Answering the “so-what?” question…
“…the success of commercial intelligence as a business tool can be directly related to two critical factors…”
1.Relevance of information to the procurement individual
2.Ease of use
Clean your supplier data
Internal data
External data
Common identifier
Inactive suppliers
Duplicates records
Information that drives cost savings
How important is our business to theirs?
Are we leveraging our total spend across their group?
