Procurement Activism

I described last week how various tumultuous events recently had led me to question a long-held belief -that procurement should stick as far as possible to our core business and avoid wider social purposes around our activities. So how and why exactly has my belief system shifted?

I think procurement has no choice. There are now just too many critical external factors to make it tenable for us to continue along the simple path of value for money above all else.  We mentioned some of them in last week’s post – the growth in inequality, youth unemployment and the threat of a breakdown in civil order in many countries, never mind Italy and Greece falling into foreign controlled hands...

Why do I think we have to be more assertive now? Well, apart from it being “the right thing to do” as our previous contributor to this debate, Ruth Pires, would say, we believe that governments in particular are going to demand it. It is hard to imagine that given all the economic problems we face, Governments will not wish to use their spending power in a more targeted manner to achieve economic and social goals. We’re already starting to see that now, with more noise (at least) coming from governments around social issues in procurement and focus on supporting small or local businesses. This may well extend to governments and investors looking for larger private sector firms to follow that lead as well.

So we have to become more pro-active, take the initiative in addressing – as far as we can – some of these huge issues. Of course, procurement can’t come close to solving the world’s problems, but can we act in a way that at least considers them and looks to help where we can? And as a corollary, we must also recognise  the dangers in any procurement approach that brings factors beyond value for money into play – because if we don’t, those dangers (particularly fraud and corruption) could overwhelm the benefits of any change of approach.

We’re calling this approach PROCUREMENT ACTIVISM.

If anyone has a better idea for a name, please contribute it! But we’re going to be promoting this idea as something we believe organisations and individuals should  be following.  It feels like an idea that is right for the time – and a snappy phrase may help rather than going “oh yes, we believe in using procurement to support wider goals and cases such as environmental sustainability, support for female, minority owned, small and local suppliers, fair treatment for sub-contractors and workers in the supply chain..”

Much easier to say “yes, in our organisation we’re Procurement Activists!”

More tomorrow - including a first look at the negatives (because we always like to be even handed), and we’re off now to design the T-Shirt...

Voices (4)

  1. Pete:

    I’m right behind you on this Peter.

    I recently wrote about the unintended consequences of the financial, economic and mathematical models we use to optimize supply chains:

    “They’re not perfect, but as they become more complex and more accurate, we begin to rely on them. We begin to believe them and when that happens, they change. Instead of predicting what is likely to happen based on past experience, they dictate what is going to happen because we trust what they say and we react accordingly. Their predictions become self-fulfilling prophecies and because we take our hands off the helm, consequences that were never intended emerge.”

    The article is here: http://purchasinginsight.com/the-algorithms-that-are-taking-over-the-world/

    It’s all well and good sitting behind corporate governance structures and limiting our responsibilities to our job description.

    “Procurement Activism” is not just a moral stance, it’s a professional stance too that recognizes that there’s a bigger picture. It separates the boys from the men – those who need to be told from those who aren’t prepared to wait for permission to act.

    1. Life:

      I’m sure its possible, but it seems hard to not be at least a little suspicIous of a professional stance that claims to separate the “boys from the men”. Would it be possible to benchmark this against anything?

  2. Gordon Murray:

    Generally I agree and have been an ‘activist’ for many years BUT procurememt should be aligned with the ojectives of the organisation – it requires that corporate mandate to act. Without the mandate it is a maverick liability. Procurement Activism has the sound of mavericks trying to change to something which the procurement manger thinks the organisation should do. Strategically aligned procurement is closer to what I mean, but who would say they weren’t strategically alligned. Of course we’ve had ‘policy through procurement but that seems to have become unfashionable. Perhaps Professional Procurement would be better – but we’ve justy heard CIPS imply public procurement isn’t professional and probably upset a whole swaith of paying members to be politically in favour. Perhaps Proactive Procurement as opposed to laggard/reactive procurement?

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