In a potentially landmark decision for the contingent workforce, “multi-tier” suppliers and their contractors, the National Labor Relations Board ruled Thursday that businesses share equal responsibility for their contingent workforce supplier’s labor violations. By setting a legal precedent, the NLRB ruling may undermine the common practice of businesses relying on suppliers to shield themselves from co-employment risk. From a procurement standpoint, the ruling could significantly impact the established contingent workforce supply chain, potentially leading businesses to re-evaluate their use of supplier-provided contingent workforce.
Category Archives: Risk Performance and Compliance
Convicted Murderer Drives for Uber: Is ‘Misidentification’ Risk Heightened in a World of Platforms and Independent Workers?
While the use of work intermediation platforms (WIPs) and independent workers may be starting to look attractive even to procurement practitioners, there are risks. The most well-known and recently publicized of these is the risk of “misclassification.” However, a lesser-known and potentially greater risk may be “misidentification” risk – being mistaken about who a person actually is and what their real background is.
This risk of misidentification was highlighted in a recent report that an Uber driver in Los Angeles was actually a convicted murderer. In this case, the convict used a fake identity to pass the company’s background check, which in most cases is performed by one of a multitude of third-party providers. However, the failure to validate the identity of the person in the first place reveals the potentially fatal breakdown in the identity verification process.
But this article isn’t about just Uber. Hundreds of such cases for employees and contractors likely occur every year without all the media scrutiny. Still, the number of occurrences could certainly be reduced through better focus, rigor and technology, such as electronic fingerprints.
US companies struggling to determine and report to federal officials if their supply chains contain conflict minerals may have felt some relief this week when the US Court of Appeals for the DC Circuit struck down the federal government’s conflict mineral disclosure requirement, saying it violated the First Amendment.
Our sister site MetalMiner reported on this news in more detail this week in its article DC Circuit Rules Against Disclosure Requirement in Conflict Minerals Rule Again, authored by MetalMiner Assistant Editor Jeff Yoders.
“The court’s rulings did not overturn the entire Conflict Minerals Rule, it actually upheld requirements such as having companies investigate whether their products include the minerals and a requirement to file public reports on their investigations, a process that began last year,” Jeff wrote.
Spend Matters welcomes this guest article by Steve Sprague, vice president of product strategy at Invoiceware International.
Multinationals operating in both Europe and Latin America may be tempted to use their European e-invoicing networks to manage Latin American compliance. However, these systems do not go far enough to meet the complexities of Latin American business-to-government regulations. In fact, many of these mandates have made traditional e-invoicing networks unnecessary in Latin America, as governments – such as Brazil’s SEFAZ – are offering invoice access directly from the government servers.
AGCO uses riskmethods to power its technology solution and to much benefit, as the agriculture manufacturer has seen a significant positive impact on its supply chain as well as its bottom line as a result. Thomas Kase, vice president of research at Spend Matters, has all the details in A Case Study in Global Supply Chain Risk Management: How AGCO Implemented an SCRM Solution to Save Millions, a new piece of free research from the Spend Matters team. An excerpt: “The concept of supply chain risk is front of mind for nearly all Global 2000 firms like never before. Thankfully, as these risk factors grow in importance, new technology is making the underlying drivers more visible as well as more manageable.” Get your copy today!
It’s another Flashback Friday here on Spend Matters. You don’t want to risk missing out on another one of our most popular Ask the Expert webinars of all time: Providers Who Actually Get to the Root of Risk & Compliance. As Thomas Kase, vice president of research, warns in this webinar from our archives, risk is lurking ahead for every procurement organization regarding finances, performance and compliance. You need to manage this risk to avoid the consequences. How do you do this effectively? And, which solution providers offer the best tools to help procurement organizations tackle risk? (Hint: Check out the webinar!)
There’s no shame in taking a page from the book of the tried and true. If imitation is the sincerest form of flattery then it certainly helps if that imitation also translates to hard savings. Take for instance the recent case study we completed with AGCO on its supply chain risk management solution. It worked and we’re here to give you all the details: A Case Study in Global Supply Chain Risk Management: How AGCO Implemented an SCRM Solution to Save Millions by Thomas Kase, vice president of research for Spend Matters, is now available for FREE download. Get your copy today!
In this second part of our 10-part series on contract lifecycle management (CLM), we describe our CLM framework first in business terms to set the right context before we start describing solution requirements that will lead to solution approaches and providers. The term “CLM” itself is actually somewhat limiting because it describes the workflow surrounding the contract lifecycle rather than how contracts can be used to support broader enterprise initiatives and relationships. We’ll cover this in the “commercial performance management” layer of the framework (e.g., diving into obligation management as a key multi-faceted competency) and also how CLM connects to 7 key buy-side process areas and 10 enterprise areas. We'll also examine core CLM requirements, covering 11 contract lifecycle processes and 6 contract information management areas, as well as do some initial discussion of underlying technical platform components. Let’s dive in.
Policy Meets Procurement and Category Management: Analysis and Implications of the Supreme Court Striking Down EPA Regulations
In a late June ruling, the US Supreme Court struck down Environmental Protection Agency directed regulations for limiting mercury and toxic emissions from coal and oil power plants. From a procurement and supply chain vantage point, the ruling is arguably the most important decision the nation’s highest court has made in the past decade. Not only does it cut to the very heart of procurement’s mission to manage costs, but it has direct linkages with energy sourcing and category management. The decision also highlights the need for procurement to work more closely with public affairs and public policy teams inside their organizations. This Spend Matters PRO brief analyzes the implications of the ruling for procurement and supply chain organizations and provides recommendations for manufacturers and non-manufacturers alike on how to take action around policy and regulations.
At its customer event this week, Beeline shared a number of benefits that companies can expect to realize from engaging freelancers compared with contingent staffing resources. These include increasing the available talent pool, lowering costs by at least 13% and more. Spend Matters takes a look at these benefits and explores the potential risks (and how to avoid them) when it comes to engaging with a contingent freelance workforce. Also, stay tuned as we continue to provide coverage from the Beeline conference this week!
Consumers are constantly looking to Apple as a thought and product leader for the devices they need to run their lives. But businesses too can follow Apple’s lead and, more specifically, procurement organizations can glean risk-treatment cost reduction tactics from Apple’s contract terms for their suppliers. Join us Thursday, June 25 at 10 a.m. CDT for the webinar, Understanding Risk Exposure: An Analysis of Apple’s Contract Terms For Their Suppliers. Pierre Mitchell, chief research officer at Spend Matters, will be joined by Tim Cummins at IACCM and Ulf Zetterberg at Seal Software. Register today!
Contract management is undergoing a transformation, moving from the back of the procurement kitchen to nearly taking center stage. A good part of the reason is the corporate transition from a more passive "risk viewed as lack of compliance" efforts toward a more dynamic and comprehensive approach to risk management. This approach doesn't just examine legal clauses as such. Nor does it merely ensure that agreed upon prices and SLA deliverables are met, although those reasons are obviously part of the equation. There’s more to it – much more. In this Spend Matters PRO research brief, we begin by reviewing the core components of CLM systems, and then we explore the path to predictive contract negotiations, delving into the intersections of big data, predictive analytics and contract management.