Responsible Procurement Management and Sanofi – part 2

Here is part 2 of our guest post from Alis Sindbjerg Hemmingsen, who runs Responsible Procurement Excellence in Copenhagen. Alis continues with her review of Sanofi’s recently published CSR factsheet which you can read here. Responsible_Procurement_May_2013(1)  

 

A challenge: Scaling their approach to waste reduction

It seems like Sanofi has (re)designed their processes around the fact that paper based evaluation questionnaires can be quite time consuming both for the supplier and for the organisation. By integrating the Ecovadis e-procurement solution they have more or less automated this activity.

Again, if Sanofi wants to be a brand with a stand they will have to work closely with their suppliers in order use the data accumulated and find ways to work them. One way could be a corrective action plan, or another way could be by defining common environmental projects.

They do already have energy efficiency programs which the Procurement team has strongly supported. This includes an energy market intelligence process , allowing them to identify all relevant risks and opportunities such as renewable energies attached to local markets. I believe their challenge in going forward will be to scale their approach to energy reduction, or waste in general, with their wider supply base.

Take on a category approach to risk mitigation

One of the ways in which you can work more efficiently with your categories and suppliers is to take on a category approach to risks. Sanofi has developed a specific sourcing program for their educational and promotional materials. This program aims to guarantee that sourcing origins are in accordance with the Sanofi CSR standards and allows them to trace production and preserve quality and product safety.

The supplier evaluation process

They have strengthened their supplier evaluation process by systematically addressing CSR matters as a more and more significant element of the “supplier relationship management” approach. They are also focused on monitoring corrective action plans, measuring the suppliers CSR performance and ensuring they deliver relevant KPI’s.

They mention they want to improve awareness among suppliers of the group’s CSR principles so they are compliant with their fundamental social, environmental and ethical beliefs. Unfortunately the document does not mention how they will do this.

Taking Sanofi’s approach to the next level

In order for Sanofi to take their approach to the next level, I would recommend that they (and others going down this route) consider the following:

• Focussing the approach to what makes sense in terms of their business model. One size does not fit all. Then develop and publicise clear Responsible Procurement targets and visions.

• Define the expectations towards their suppliers and employees - existing as well as new suppliers. How should they act and what should they work towards? How can they contribute to the sustainable development of Sanofi?

• They say they want to select environmentally friendly goods and services through approved suppliers. This requires category specific strategies and projects where this is a transformational goal - and suppliers must play an active role in this as well.

• They talk about creating business value by stimulating and taking on board suppliers innovation. So start out by describing how an idea is taken from “idea” to “implementation”, and define just how you are going to operationalised your open approach to innovation.

• Integrate the CSR KPI’s into the procurement categories and category plans so you can track the supplier performance more efficiently. And even better: integrate the CSR KPIs into the bonus system of the procurement professionals (and perhaps into the reward for the suppliers too!)

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