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Leading businesses see procurement as a value, not a function

Jonathan Cooper-Bagnall
Jul 22, 2015 9:48:00 AM

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Procurement as a value, not a function

It’s not often that a story about new supply chain management software becomes a feature in a publication as respected as The Wall Street Journal. For that to happen, the deployment of said software has to represent something much more significant or herald a trend of highly compelling proportions.

This month, the news from manufacturing specialist Flextronics fits that bill.

According to the WSJ, the provider of parts to the likes of Apple, Microsoft, Ford and many more has designed and rolled out a new software program that allows for greater control of the company’s 14,000 global suppliers. Here’s the unique part – the software actually decentralizes the supplier management process and puts data and critical information into the hands of local managers across the globe so they can make appropriate decisions as it relates to the company’s supplier base. Essentially, the company is offering visibility of supply chain data across the company so decisions can be made quickly region-by-region, especially in the aftermath of an unexpected event.

We have consistently talked about the importance of providing key decision makers in the organization with a holistic view of supplier information. This is exactly what Flextronics has done. Anyone in the company no matter where they are in the world can access information about suppliers and inventories. They can even see live video feeds of production facilities.

Flextronics, a supplier themselves, has taken a leadership position in supplier management. The company clearly understands the importance of ensuring that the right suppliers are in place to deliver on the needs of the business. But they also recognize how crucial it is to be able to audit, manage and monitor supplier activity both for the purpose of reducing costs but also to flag any ethical or behavioral issues that might arise. And instead of holding that information among a key few, they are empowering a wide swath of employees to participate in the process.

This move by Flextronics highlights that progressive leaders crave the stuff that connects their business with the supply market in real-time, and empowers their people. They are less interested in funneling work through a single function, and more interested in embedding best-practice into the fabric of their business. They see procurement as something that should be done ubiquitously and consistently across their business - a cultural trait, a core value and a way of working. Not kept locked in your back office.

Is your procurement function seen as a key business tool, or an administrative burden? Watch the on-demand webinar to learn how to shift corporate management's attitudes towards procurement.

As always, if you have any thoughts or comments, please add them to the box below. Shifting attitudes towards procurement webinar

 

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