Certification of procurement professionals in the public service Mark D. Lamb, General Manager – Asia Pacific Chartered Institute of Procurement & Supply (CIPS) 16 November 2017 Leading global excellence in procurement and supply
The Global Environment Changing Business Models Economic Shifts • Digital economy • Global trade deals – • The rise of Block chains, Internet a new paradigm? of things and AI Key Trends (CEO concerns) Ethics and Compliance • Cyber security • Increasing supply risk • Increased regulatory pressures • Clean supply chains Outsourcing Rise of protectionism • Offshoring/reshoring trends • NTBs (Non-tariff barriers) • Divestment of assets Leading global excellence in procurement and supply
The Professional Environment World of Work Professional Relevance • Increasing part-time contracts • 2030 – 65% of graduates will have • Gig Economy jobs that currently don’t exist SME Prevalence • Represent 50-52% of GDP and 99.3% of organisations AI and Big Data World of Learning • 2040 - $1,000 computers with • CPD computational power of human • Skills based learning species Leading global excellence in procurement and supply
The Procurement and Supply Environment Outsourcing Technology • Offshoring/reshoring trends • 3D printing • Divestment of assets • Big data Supply Risk Public Procurement • Lowering tolerance of risk • 10-20% of Global GDP (Modern slavery / Cyber • Used for protectionist policies malpractice) Mergers and Acquisitions Changing Expectations • 60-80% M&A fail often due to • 48% of CEOs believe CSO boardroom role 2020 Procurement non involvement and see the profession as an investment not a cost Leading global excellence in procurement and supply
Supply Chain Risk Global supply chains increasingly disrupted by both physical and ideological battles • Asia Pacific contributed 37.4% of supply chain risk in Q1 2017, up from 33% at the end of 2016. • Conflict is creating supply chain no-go areas, cutting off global markets and potentially causing a scarcity of goods. “Supply chain infrastructure can only function normally and efficiently when there is trust and collaboration between all nationalities and sections of society. …supply chain infrastructure is one of the first casualties of conflict and the results can be devastating.” Dr John Glen CIPS Economist Leading global excellence in procurement and supply
How Resilient Are You? 83% of CEOs believe their supply chains are not optimal to meet todays demands 81% of businesses experiences at least one supply chain disruption last year 15% believe their supply chain is resilient enough to address external disruptions 60% pay only marginal attention to risk reduction processes Leading global excellence in procurement and supply
Burning Platform – Ethical Supply 45.8m people are forced to live in slavery How many tiers of your supply chain would you ascertain your organisation have visibility of? Third world 20% leakage in government 57% budgets due to fraud More than US $1 trillion are paid in bribes 17% annually 15% 11% Corruption adds 10% to the cost of business and 25% to public procurement in developing countries First Tier First and Tier Three Complete Every day 6,300 people around the world only Second and Beyond Visibility all die from work-related accidents or Tier only the way diseases down CIPS YouGov Survey 2014 Base: B2B senior decision makers whose business has a supply chain Leading global excellence in procurement and supply
Artificial Intelligence • Those implementing this technology are not seeking our permission to implement • Algorithms with intelligence can replace large parts of our roles • Their arrival is raising the intellectual entry point 98% - Bookkeeping, accounting and purchasing clerks 94% - Accountants and auditors 64% - Stock clerks and Buyers 48% - Computer programmers 43% - Economists “To benefit from AI, managers will need to sharpen EI” 3% - Purchasing managers Source: The Future of Employment: How susceptible are jobs to automation, Michael Osborne and Carl Frey, Oxford University Leading global excellence in procurement and supply
Supply Management Leading global excellence in procurement and supply
Supply Management Leading global excellence in procurement and supply
Effectiveness of SM campaign BOTH: 91% 67.2% 78.7% Said Supply Management’s Has our coverage altered Said it made them coverage of slavery and the the way you think and think or act UK & Modern Slavery Act behave as a consumer and differently helped increase their a procurement awareness and professional? understanding issue Snapshot reader survey (123 Responses, July 2016) Snapshot reader survey (123 Responses, July 2016) Snapshot reader survey (123 Responses, July 2016) Leading global excellence in procurement and supply
Ethical Procurement and Supply Horse meat in the supply chain Leading global excellence in procurement and supply
Ethical Procurement and Supply Human rights FIFA World Cup Leading global excellence in procurement and supply
Ethical Procurement and Supply Poor working conditions Rana Plaza Leading global excellence in procurement and supply
Ethical Procurement and Supply Slavery in supply chains “ From nail bars and car washes to sheds and rundown caravans, people are enduring experiences that are simply horrifying in their inhumanity… ” Leading global excellence in procurement and supply
The Burning Platform Ethics & Transparency Fraud • 45.8m people are forced to • Corruption adds 10% to live in slavery around the the cost of business and world today 25% to public procurement in • Every day 6,000 people developing countries around the world die from • More than US $1 trillion work-related accidents or diseases are paid in bribes low annually • Integrity in food and retail supply chains is at a low Leading global excellence in procurement and supply
Ethical Procurement & Supply CIPS Role Educate the Educate the Inform the Profession Public Debate Licensing the Profession Leading global excellence in procurement and supply
Informing the Debate Modern Slavery Act 2015 Leading global excellence in procurement and supply
Consultation and Presence Evidence given at Select Committee on draft Modern Day Slavery Bill in Feb 2014 and responded to consultation in May 2015 Attended Home Office Supply Chain workshops to inform the draft bill Consultation with CIPS membership and CEOs to gain validation Engagement with Karen Bradley MP Minister for Preventing Abuse and Exploitation, Kevin Hyland OBE Anti-slavery Commissioner and Paul Broadbent CEO Gangmasters Licensing Authority CIPS CEO attended the signing of the Faith Leaders’ Universal Declaration Against Slavery at The Vatican, December 2014 Leading global excellence in procurement and supply
Educating the Profession Leading global excellence in procurement and supply
Ethical Procurement and Supply Code of Conduct - updated Promote the eradication of unethical business practices, by: • Fostering awareness of human rights, fraud and corruption issues in all my business relationships • Responsibly managing any business relationships where unethical practices may come to light, and taking appropriate action to report and remedy them • Undertaking due diligence on appropriate supplier relationships in relation to forced labour (modern slavery) and other human rights abuses, fraud and corruption • Continually developing my knowledge of forced labour (modern slavery), human rights, fraud and corruption issues, and applying this in my professional life Leading global excellence in procurement and supply
Ethical Procurement and Supply Guides Leading global excellence in procurement and supply
Ethical Procurement and Supply CIPS Ethics E-Learning and Test – launched February 2014 Leading global excellence in procurement and supply
Ethics and Sustainability Ethics mark and professional register Leading global excellence in procurement and supply
Ethical Procurement and Supply Corporates – collateral and online Leading global excellence in procurement and supply
Ethical Procurement and Supply Corporate ethical mark, usage guidelines and global register Leading global excellence in procurement and supply
Modern Slavery Guidance Sample Code of Conduct Risk Screening Tool Labour Violation Questionnaire Corrective Action Plan Framework for Implementing a Defining Roles and Communication Strategy Responsibilities Supplier management and engagement Leading global excellence in procurement and supply
CIPS Resources Leading global excellence in procurement and supply
Impact of the Act on Business Leading global excellence in procurement and supply
Effectiveness of the Modern Slavery Act The UK Home Office estimate that between 12,000 – 17,000 organisations are required to complete a TISC statement TISCreport.org have 48,486 statements from 21 sectors and 15 countries “Since the introduction of the legislation, there had been a 63% increase in the number of victims coming forward – to more than 4,000 referrals last year – and a 77% increase in convictions” Kevin Hyland UK Anti -Slavery Commissioner QUOTE from Andrew Wallis Leading global excellence in procurement and supply
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