When the national TV calls and asks about the working conditions at your suppliers’ factory, you better have a remedy plan ready. That could be the take away message from the cautionary tale that Factlines delivery manager Iris Frøybu shared in the first episode of Innkjøpsforeningens podcast series.
Iris Frøybu was invited by podcast host and chairman of Innkjøpsforeningens, Diana Riis, to talk about responsible procurement in a global perspective. In the podcast, Iris shares an anecdote from the time she was tasked with establishing a cell tower network in Bangladesh.
From 2007-2009 Iris was responsible for logistics and procurement in a telecommunication company. The company won a major turnkey contract to establish telecommunication in Bangladesh, and buying products and services from local suppliers was a prerequisite, which is common for national infrastructure projects. The project had to be completed within a short timeframe, resulting in short lead times and a lot of pressure.
The team began searching for a local supplier of the structural parts of the cell phone towers, and this turned out to be a difficult process. They found a possible supplier that promised high quality and low lead times to a very good price. When visiting the supplier the team found production in a very questionable location, exposed electrical installations and chemicals in unprotected containers. No personal protection equipment was seen, and no available documentation.
The team crossed the supplier from the list, and came to the realization that they had to make a plan for qualifying suppliers based on very specific criteria. Iris company already had internal guidelines for environment, work conditions and etc., and the team had to take up the control and follow up to ensure that these were being carried out at the supplier.
They made a plan for training, and made courses for management so they understood what we expected of them. Bangladesh is an extremely impoverished country with immense environmental challenges. There is a culture of hierarchies, and workers are afraid to make mistakes because it means losing their jobs in a place when thousands of others are ready to replace them. Teaching people to think for themselves was part of this process, and it was often small interventions that made big changes.
When the hard work paid off
Shortly after the initiatives had begun Iris was contacted by corporate headquarters in Stockholm that had been asked to respond to the documentary “Tower of promises – Flip the coin”. The film documented major problems with Ericsson and Telenors conduct in foreign countries, and many of the problems she had witnessed at the factory visit were the same. Iris company largely escaped the criticism because of the initiatives Iris and her team had put into place.
The story is exemplifies why it pays to address issues with suppliers in a structured manner, and that it is important to have a realistic and pragmatic approach to what can be achieved. The case was an eye opener for many, and now most major companies have process in place for working in risk zones.
Listen to the entire podcast here: https://feeds.buzzsprout.com/1168757.rss