Across the world, a widespread procurement evolution is occurring. Numerous procurement reforms, constantly changing trends, and other unforeseen circumstances in the market have spurred on this evolution. To address these changes and stay ahead of the competition, procurement professionals must pivot and adapt quickly. This pivot includes those in charge of vendor management systems, supplier management, and more.
In this competitive, high-stakes procurement arena, stumbling is not an option – at least for those of us focused on success, sustainability, and growth. And don't we all want that? Learning how to better understand and address each of these elements is paramount to remaining relevant in a changing world economy.
Join us as we dive into what's happening in procurement today, how it is driving a range of behaviors and emerging trends, and what this means for you and the future success of your procurement strategies. After all, one of the most impressive success stories today – and someone who knows a thing or two about procurement and strategy – is Amazon Founder Jeff Bezos, who once said,
“In today’s era of volatility, there is no other way but to re-invent. The only sustainable advantage you can have over others is agility, that’s it. Because nothing else is sustainable, everything else you create somebody else will replicate.”
Bezos knows how vital adaptation and re-invention is for procurement to keep striving for supply chain efficiency. So, without further ado, let’s heed Bezos’ advice and look at some of the specific procurement changes we see here in 2022.
How Has Procurement Changed?
Among the plethora of changes, we are seeing in procurement today, the rise in organizations focusing on responsibility and accountability is profound. Companies are quickly adapting to take greater responsibility for their operations with robust CSR strategies.
CSR (corporate social responsibility) is a self-regulating business model that holds the organization accountable to itself, its stakeholders, and the public. This is also regularly called corporate citizenship.
Essentially, it is an organization’s way of taking responsibility and holding itself accountable for its impact on society in the economic, social, and environmental spheres. CSR aims to hold organizations accountable for their operations in a way that enhances all aspects of society and the environment versus negatively affecting them.
In a nutshell, adopting CSR practices symbolizes a company’s oath to the general public to have a positive impact.
Why CSR Matters
With the great pains that companies are taking to improve their CSR strategies, not only is it producing numerous and far-reaching benefits for society and the environment at face value, but taking such steps is also an excellent way to promote a positive business brand and even increase the bottom line.
As consumers become more aware of environmental issues and embrace better conservation practices in their daily lives, they are naturally looking to support those brands that align with their personal values. When consumers see brands with stand-out CSR, it sets them apart from the crowd.
One brand that has consistently set itself apart in CSR is the iconic ice cream brand Ben & Jerry's Homemade ice cream. The brand’s impressive and extensive CSR reputation includes lobbying for peace-keeping funds, removing growth hormones from food, supporting the Children’s Defense Fund, and much more.
Greater supply chain diversity is another focus. By doing business with more diverse suppliers, your organization will expand the pool of potential suppliers and promote innovation by introducing new products and ideas into your supply chain.
Just as with CSR, consumers are beginning to look for greater diversity in a brand’s workforce and its supply chain. Consumers look to support organizations that embrace diversity as a core tenet of operation.
Companies can also keep tabs on their impact using ESG scores — the measure of a company's exposure to long-term environmental, social, and governance risks often overlooked during traditional financial analyses.
Understanding and embracing ESG scores is essential to stay compliant with government regulations and to keep pace with the competition. ESG scores provide a concrete figure that can help organizations to meet the high standards of their shareholders and consumers
Global Supply Chain Disruptions
Not only are expectations regarding societal and environmental impact affecting procurement teams, but global supply chain disruptions also pose real challenges.
Complicated compliance issues create headaches across international borders, increasing the strain and stress associated with the now ever-present, pressing need to evaluate supply chain and trade operations.
To excel despite the changing requirements, organizations are scrambling to take control of their supply chain. Having a proactive procurement team that handles effective supplier management and risk is essential to your team’s impact.
Here is where we can help. Graphite is a B2B network that provides supplier onboarding, supplier data management, and supplier risk solutions to help you to ensure regulatory compliance, address risk in your supply chain, and streamline your entire data management and procurement process.
It's already nearing the end of 2022 – are you ready for all that 2023 and beyond will bring? Let's get you operating at the top of your game because it's go-time, and as time has proven, we must adapt or die.