The Supply Chain Management Category

Want to Know Your Industry’s Risks? CSR Index from EcoVadis Takes Deep Look

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As customers and businesses seek better environmental practices and fair labor standards, corporate social responsibility (CSR) reporting has taken on greater importance for executives who could face questions about why they use conflict minerals or buy products created by forced labor. To help take a deeper look at the issues, EcoVadis has assessed the CSR reporting of more than 33,000 companies around the world. The Paris-based company is a provider of business sustainability ratings, intelligence and performance-improvement tools for global supply chains.

Tradeshift: Vendor Snapshot (Part 1) — Background and Solution Overview [PRO]

Tradeshift is a cloud platform that connects buyers and suppliers with the goal of digitizing supply chain relationships, processes and information, while also enabling everyday procure-to-pay activities. Its capabilities span the buying of goods and services through to financing and payment — and significant capability in between, especially in the invoice-to-pay area.

In addition to providing its own procure-to-pay modules, Tradeshift offers an open integration framework that allows other technology firms (and customers) to integrate and/or development third-party “apps,” primarily centered on supplier connectivity, transaction enablement and collaboration. Tradeshift can even integrate alternative procure-to-pay providers in cases where specific enabling capability is desired.

This Spend Matters PRO analysis provides an introduction to Tradeshift, both as a platform-as-a-service (PaaS) provider and also as an e-procurement and invoice-to-pay technology vendor. It is designed to provide facts and expert analysis to help procurement and finance organizations make informed decisions about whether they should consider Tradeshift for both traditional “in-the-box” procure-to-pay requirements as well as unique marketplace/platform type digital initiatives.

Part 1 of our analysis provides a company background and detailed solution overview, as well as a summary recommended fit suggestion for when organizations should consider Tradeshift as a complement to other procurement and finance solutions. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

An Introduction to Sourcing Business Intelligence (Part 2): The Leap from Sourcing Analytics to Supply Intelligence [PRO]

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In Part 1 of this Spend Matters PRO research series, we defined and explored the concept of sourcing business intelligence (BI), an emerging focus area for an increasing number of procurement organizations. Sourcing BI is not a “tool” like a spend analysis application module or a general purpose BI tool — like the visualization tools Qlik, Tableau or Sisense. Rather it is an enabling approach to sourcing, supplier management, total cost modeling/should cost analysis and related initiatives like clean sheeting that focus on the ability to incorporate increasingly rich external market, commodity, category and supplier intelligence with existing internal data sets, process flows and activities to enhance savings, compliance and organizational resilience.

Much of this activity is occurring within category management where managers are trying to move from historical descriptive analytics to “outside-in” predictive/prescriptive analytics that yield true intelligence rather than just subscribing to tribal best-practices sharing and generic data-as-a-service (DaaS) offerings in the marketplace.

In Part 2 of exploring sourcing business intelligence, we first will set some context about how to make the leap from sourcing analytics to broader supply intelligence. “Supply management” is bigger than “sourcing management” — and similarly — “intelligence” is bigger than “analytics.” By understanding this evolution, it helps us set up a deeper discussion into how artificial intelligence relates to analytics — with an immediate focus on sourcing, but a longer-term focus on broader spend/supply.

With USMCA Done, Supply Chain Professionals Can Get Down to Work

sustainability

Procurement and supply chain professionals reacted to the new USMCA trade deal this week with relief that they now know what to focus on in a post-NAFTA landscape — and that they can begin figuring out how the pact fits with ongoing tariff disputes with China. Trade negotiators on Sunday finalized the U.S.-Mexico-Canada Agreement, a new pact that will replace NAFTA. After about two years of turmoil, the deal was welcome news for supply chain professionals because it removed uncertainty from their planning processes.

Commodities Roundup: Excess Steel Capacity, Oil Prices and U.S.-China Trade

For the buyers and category managers out there, especially those of you deep in the weeds of buying and managing commodities, here’s a quick rundown of news and thoughts from particular commodity markets. From price movements to policy decisions, our MetalMiner editors scour the landscape for what mattered this week.

Mitigating Trade War Risks: Do Procurement Organizations Have the Data Needed to Respond?

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What’s the best tool procurement organizations have to mitigate risks in the U.S.-China trade war? In a word, data. The Trump administration’s Section 232 and 301 probes have led to billions of dollars’ worth of tariffs, igniting a U.S.-China trade war. And the tit-for-tat duties are only likely to escalate: The Office of the U.S. Trade Representative in July published a list of additional Chinese goods to tax — to the tune of $200 billion. With everything from vaccines to nuclear reactor parts to metals beyond steel and aluminum up for consideration, escalating trade tensions have introduced numerous unforeseen risks into procurement and supply chain organizations.

U.S. Apparel Industry Scrambles to Diversify Sourcing Strategy in Wake of Escalating U.S.-China Trade War

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For many U.S. companies in the apparel industry, the old sourcing strategy of “made in China” is turning into “China plus Vietnam plus many,” with emphasis on the many. As Washington and Beijing continue to one-up each other’s tariff threats, the prospect of a looming trade war is driving U.S. apparel companies to further diversify their sourcing strategy and shift production away from China. While China remains the top sourcing destination for the U.S. apparel industry, the country now accounts for 11%–30% of companies’ total sourcing volume, compared to 30%–50% in the past.

The Amazon Prime Effect: Rising Expectations for E-Commerce Delivery and Fulfillment

If the 100 million-plus shoppers who pay $119 a year for fast shipping via Amazon Prime are any indication, a smooth and expedient delivery and fulfillment process is crucial to e-commerce success. And expectations are rising. According to a recent survey of 3,000 online shoppers from Canada, the U.K. and the U.S., younger generations are particularly critical, with less than half of respondents between the ages of 18 and 34 saying that they receive their orders on time and in perfect condition. These findings are published in a new report from Radial, “The Everyday Essentials of Successful E-Commerce Fulfillment.”

Risk of Slavery, Trafficking and Labor Abuse in Supply Chains Expected to Increase

As manufacturing becomes increasingly automated, the risk of slavery, human trafficking and labor abuse in supply chains is also expected to rise, according to Verisk Maplecroft’s 2018 Human Rights Outlook. The report presents five issues that will pose “significant challenges to the reputations, operations and supply chains of multinational companies.” Automation tops the list, with an estimated 56% of jobs in Southeast Asia’s key manufacturing hubs potentially affected. Compliance, certification, threats to human rights defenders, and investor expectation for businesses to take up social responsibility round out the list.

Building the Business Case for Managing Suppliers With Technology: 7 ROI Levers (Part 2 — Supply Risk Management) [PRO]

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Thus far in this series we have examined six levers procurement organizations can pull, both at the front-end of the supplier lifecycle and those in the active phase of supplier management, to build a business case for managing suppliers with technology. In the case of the former, we focused on business case components for supplier search and discovery, supplier onboarding, and supplier enablement. In the latter, we examined contract compliance and enforcement, compliance and credentialing, and supplier performance management.

All of these areas can form core components of a supplier management business case. But on a standalone basis, thousands of global companies have already invested in data sources, specialized software or a combination of the two to monitor at least certain elements of supplier risk outside of these other supplier management areas. Indeed, of the seven levers organizations can pull in building a business case for managing suppliers through technology, supplier risk management — and broader supply risk management — is the one that is often most put to use.

In today’s installment, we zero in on the seventh supplier management business case lever, introducing business case and enabling technology considerations for supplier risk management. We discuss select solution components within this area, as well as high-level ROI considerations. Later in the series, we will provide more detailed ROI model inputs and ranges procurement teams can use in building a business case in each of these areas.

Spend Matters PRO clients can also contact their client services representative for an interactive Excel-based ROI model that can serve as the basis for building supplier management business cases.

Hospitals, Medical Marijuana and Procurement: A Few Obvious Questions

When patients using medical marijuana go to a hospital, all bets are off. Not only for them, but for a hospital that frankly has no option other than to confiscate their marijuana (or try to do so), assuming they know about it in the first place. Keep in mind, the patient may be legally authorized by the state to use medical marijuana, so the inconsistency here is loaded with potential legal problems. Despite all of this, when the talk of medical marijuana comes up, most all of the hospital officials I have spoken with readily admit that they haven’t even given the subject much thought.

Auburn University’s Beth Davis-Sramek on How the Logistics Sector is Changing and Why the UPS Strike Was Unlikely

Late Thursday, the Teamsters Union and UPS reached agreement on a new five-year contract, averting what would have been the largest strike in the U.S. in decades. The International Brotherhood of Teamsters, the union representing UPS workers, had authorized a strike if the two sides do not come to an agreement before the current contract expires July 31. Before the two sides came to an agreement, Spend Matters talked to Beth Davis Sramek, associate professor of supply chain management at Auburn University, who made the prescient prediction that the strike would not go through. Read on for her thoughts on what the supply chain consequences would have been, potential contingency plans and what changes are in store for the logistics sector.