Can you recognize any of it from your everyday life? How well do you know your suppliers? Do you know where they buy from? Do you know if they have basic environmental and human rights procedures in place? Do you need good reasons to get started? Read on here.
1 - Robust supply chains are part of the foundation of modern businesses
The time has passed from simply using Supplier Code of Conduct without following up on them. A driving force behind the current focus on supply chains is that insight and follow-up have become much easier. As a result, buyers can confidently demand follow-up and control from their suppliers - they know that it is within reach for all businesses, large and small.
Sustainability is here to stay. It's not a fad. Corporate social responsibility and the environment have quietly taken a serious place in most companies. It is now united under the UN Sustainable Development Goals and is becoming unavoidable. Both public and private customers require follow-up in the supply chain as a basic condition for being considered.
2 - Better visibility leads to better decisions
Did you know that 65% of global procurement directors say they have no or limited visibility into their supply chain beyond their direct suppliers? If you're among them, you're not alone. But then you're shooting in the dark when it comes to prioritizing dialogue and follow-up. Without insight into the value chain, you don't know where the biggest risk areas are and where you should prioritize your time. Change requires insight, and you can't act on what you don't know anything about.
"We trust our suppliers. It's their responsibility to keep things in order," we often hear when we talk to companies about follow-up. And trust is good, but where do you stand when it turns out that there are problems in the supply chain? Your supplier's risk can become your problem.
3 - Avoid surprises - focus on risk
The value chains of a product or service are complex and risky. Child labor, poor working conditions, hazardous chemistry and corruption are some of the areas no one wants to have in their supply chain, but unfortunately they are widespread. Fortunately, we are getting better and better at combating serious human rights and environmental violations, partly by using mapping as a tool.
A supplier survey tells you where you should follow up. Instead of doing spot checks with selected suppliers, you can focus on where the survey reveals weaknesses.
4 - Improve relationships with your suppliers
Follow-up helps strengthen relationships with suppliers. Unfortunately, it's easy to sign a code of conduct and easy to forget it. By creating a supplier survey, you also send a clear message that this is an area you take seriously. The survey is an educational way of reminding suppliers of what you expect from them and why it is important that they take responsibility for their part of the chain, even if they see themselves as a small player with no influence.
Through follow-up and improvement measures, the supplier also stands better in the market. This type of dialog strengthens both you and your suppliers. In this way, you can turn compliance requirements into business opportunities.
Sources:
Deloitte 2018 CPO Survey
High-risk products https://www.anskaffelser.no/samfunnsansvar/sosialt-ansvar/laer-om-hoyrisikoprodukter
The CSR Compass (www.csrkompasset.dk)
