Transparency – we want to know everything about our suppliers. Or do we??

In part 1 we looked at an excellent article from David Aaronovitch in the Times last week. He postulated that the apparent bad behaviour by public organisations actually reflects the step change in transparency of the last few years, rather than a step change in behaviour. But he ended by asking whether greater openness may lead us to trust our state institutions less rather than more.

Let's extend the argument to the procurement and supply chain world. We know that technology and social trends are allowing us to understand more about our suppliers and potential suppliers, to know more about them and their activities, and to interact with them and their staff in ever easier and less formal ways.

We've written about products such as Rollstream, which mimics personal social media  platforms to promote collaboration between buyers and suppliers. We've seen collaborative platforms for closer working between the parties. We can find out who 's who from LinkedIn and see what employees actually think about our suppliers from Glassdoor. Risk based solutions, such as those provided by SAP Infonet, Achilles, Hellios, Aravo or whoever, can tell us more and more about the firms we deal with.

But is this actually going to engender trust? Maybe, the more we know, the less impressed we will be. Maybe if we knew what goes on inside supplying firms, we would feel less positive, not more about them. Imagine your own organisation opened up to full scrutiny. Those discussions about how to increase margins, those emails where a customer is described as a "real pain in the a**". All the chats about the cost / quality / service equations, or deciding which customer to prioritise when supply is tricky. Do you really want to know everything that goe son inside your supplier's businesses?

There's a slightly tangential but related story here,  about the AnlgoIrish Ban executives caught on tape recently talking about how they would extract money from the Irish and European taxpayer. If the reporting is accurate, transparency has made them look devious, profane and ruthless (an interesting combination). And I remember a high-level discussion about a ruse that retail banks could use to increase profit effortlessly, by extracting value from the customer without them even noticing, that shocked me when I was in that sector.

So, don't assume that knowing more will always make you feel better about an individual or an organisation. Go into these information and interaction-rich relationships with suppliers (or customers if you're on that side of the equation) with your eyes open. Indeed, a touch of cynicism may help, understanding that no-one and no organisation is perfect.Make a few allowances, as you would hope others will do for you and your organisation.

Otherwise, we may find this new world of transparency is a big disappointment.

Voices (2)

  1. Abdullah Kajee:

    The “pot calling the kettle black” comes to mind. Politics, inefficiencies, bad business processes, bureaucracy is found in most if not all companies. If ways to extract greater value from both customers and suppliers becomes known and it causes embarrassment, then it is an early sign that something is wrong. Efforts have to be made to use all negative publicity as stepping stones to improvement. The voice of the customer is King…the voice that provides free advice on what a business needs to fix…without paying enormous consultants fees.

  2. RJ:

    So right, Peter. In addition, most buyers will expect transparency to mean a one-way mirror – open book accounting, “how many quality issues have you experienced in the last 12 months?”, “have you ever been the subject of legal actions?” etc – but how many of us would like to answer questions such as “what proportion of our invoices will actually get paid on time?”, “how often will you change the specification and expect us to meet the cost?” or “to what extent does company politics completely undermine your policies and processes?”

    Reverse RFIs anyone?

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