Working with trusted and reliable partners is essential to most organisations.
It is particularly imperative within a PPP setting, where progressive supply chain management is integral to delivering successful business results and continuous improvements.
An effective supply-chain, harnessing a partnership ethos, is a key-value driver, important in good times and essential in challenging times.
At IPSL, one of our primary aims is to support demonstrating value for money across our client’s assets. This can only be achieved if value is broadly defined and universally understood throughout the supply chain, from manufacturer to end-user.
As the Sector Head: Procurement, I am responsible for the development, implementation and on-going management of the procurement strategies at IPSL.
Adopting procurement best practice is key to the success of our client’s business and therefore to our business.
Having worked in the industry for 20 years, I have identified three key principles that are essential to delivering and maintaining a successful procurement strategy:
- Strategic relationships based on mutual trust and respect
- Consistency with a long-term focus
- Accountability and teamwork
Strategic relationships based on mutual trust and respect
One of the most important procurement practices is to generate and nurture mutually-beneficial relationships year on year with preferred suppliers that have been strategically sourced. Choosing a supplier that is reliable and trustworthy, rather than making a decision based solely on competitive pricing, is far more effective in the long run as these relationships are often built to last.
The importance of using suppliers who prove to be hardworking, trustworthy and understand how your business operates cannot be overestimated if you are to achieve the best possible results for the end-user which, in PPP, is our clients and public services.
Always work with partners who meet the ESG criteria, demonstrating that they operate in an environmentally-friendly, socially acceptable way that is principled and fair. It’s a challenging time for businesses, with the COVID-19 pandemic causing disruptions to every industry, so working with ethical suppliers that respect payment terms and cash-flow dependencies is imperative.
In my experience, the best supply chain companies are those that offer a reliable service and products at a competitive, yet fair price. Returning to these suppliers time and time again results in better customer service and overall client satisfaction.
Consistency with a long-term focus
Consistency within a supply chain is essential. Constantly changing suppliers in search of the lowest price can be detrimental to a business for several reasons. Typically, this method is capricious and can result in missed deadlines, additional costs and dissatisfied customers. If I’ve learned one thing working in PPP, it’s to work with people that you trust to deliver on their promises, ‘on time and in budget’, consistently over the long-term.
Some vendors may not stay in business for very long, so the risk of having to change suppliers at short notice is much higher if you’re constantly using new companies. Focusing on building relationships with a steady supplier is a much more effective way to operate – they are likely to appreciate the steady business and can make concessions where needed.
In addition to that, having a long-term mutual understanding with a supplier makes the entire operation of the supply chain much more efficient. Ultimately, this makes everybody’s lives easier, allows everyone to focus on the same goals and will result in a higher standard of products and services for clients.
Accountability and teamwork
In my experience, procurement is much more successful when an entire organisation is responsible in some way for wider procurement successes. Making the process a team effort can help to boost company morale and improve strategic approaches to purchasing.
This can be achieved in many different ways. For example, a method that I’ve known to work exceptionally well includes designating a representative from each department to sit on a procurement committee, which consults regularly with the IPSL procurement team to obtain the best possible outcomes for our clients.
We also use data and the aggregation of scale to drive efficiency, allowing us to provide foresight and consistent work-flow to the supply chain. This, in return, helps us to secure greater value for our clients.
Without question, the execution of excellent collaborative relationships with key stakeholders, external suppliers and other parties, is essential in procurement. At IPSL, this method of operation ensures that the strategic and operational procurement needs of our clients are fully understood and met by our supply chain through both good and challenging times.
For more information, feel free to contact me on wayne.lewis@imagileps.com
