CHALLENGES • Lack of understanding of supply chain management . Procurement is a subset of supply chain management • Dynamic changes in the market (demand variability) • Lack of skilled personnel e.g. Demand/Supply planners • Foreign exchange volatility on material pricing • Long lead times (Asia ,Europe ,Americas) • Rising warehousing & transportation costs • High freight cost especially across West Africa • High imports
THE BENEFITS OF SUSTAINABLE SCM • Better forecasting to meet customer demands (keal and herbert 2010) • Revenue improvements from 2%-5% . (amr research) • Improve customer service improvement (stock availability loss reduction) • Balanced inventory across product lines and customers • More stable production rates and higher productivity • More co-operation across the entire operations • Improve in working capital through inventory reduction • Typically, operating units can achieve 7-15% reduction in inventory. • More efficient decision-making • Greater focus on long-term horizon (smiths and kipala 2012)
THANKS ... Q&A
BENNY ATTA DOLPHYNE (SEAFREIGHT SOLUTIONS MANAGER, BOLORE GHANA) This compilation is the work of Supply Chains Connect (SCC) and the content therein are the sole property of the individual speakers who presented at the Supply Chain Conference 2019 on 6th December 2019, in Accra. The knowledge, views and insights shared are the speakers’ individual knowledge, views and insig hts and not that of the companies they work for. No part(s) of this document is to be reproduced, copied or shared in any form without the express permission from the speakers through SCC.
EMOTIONAL Benny Atta Dolphyne INTELLIGENCE(EI): SCC Conference PRACTICE, Mensvic Hotel,Accra REALITIES AND 06-12-2019 IMPACT ON SUPPLY CHAIN.
3NAM OBI SO ‘It is the human being that counts, I call gold; it does not answer. I call cloth; it does not answer. It is the human being that counts .’ Ghanaian Proverb
KEY DISCUSSION AREAS
COMPLEXITY OF SCM Analysis Logistic ▪ Ethical & Moral Management Considerations SCM ▪ Authority & Power ▪ Alliances & Supply Chain Management Time to Market Partnerships Profit ▪ Family & Cultural Ties Plan ▪ Politics & Benefits Procurement Distribution
CONCEPT OF EI ▪ What? ▪ Why? ▪ How? ▪ When? ▪ Where?
PRACTICE OF EI: DOMAINS & COMPETENCIES ▪ Self Awareness ▪ Self Management ▪ Social Awareness ▪ Relationship Management ▪ Effective Communication
IMPACT OF EI ON SUPPLY CHAIN
CONSIDERATIONS FOR SUPPLY CHAIN PRACTITIONERS
THANK YOU
REFERENCES Slide 2, Image : https://www.alamy.com/stock-photo-back-view-of-accra- 1. public-transport-in-ghana-a-so-called-mammy-wagon-30142765.html (Marion Kaplan) accessed 28 November 2019 Slide 6 ,Image : https://news.artnet.com/exhibitions/this-artist-is-bottling- 2. and-selling-emotions-52407(Taylor Kinser, Bottled Emotions (2014) accessed 28 November 2019 Slides 7-9, Images: http://pjkradolfer.com/portraits-of-ghana accessed 28 3. November 2019 Goleman D (2009) Working with Emotional Intelligence. Bloomsbury 4.
DORIS KAFUI AFANYEDEY (GENERAL MANAGER CUMMINS GHANA) This compilation is the work of Supply Chains Connect (SCC) and the content therein are the sole property of the individual speakers who presented at the Supply Chain Conference 2019 on 6th December 2019, in Accra. The knowledge, views and insights shared are the speakers’ individual knowledge, views and insig hts and not that of the companies they work for. No part(s) of this document is to be reproduced, copied or shared in any form without the express permission from the speakers through SCC.
Doris Kafui Afanyedey General Manager Cummins Ghana
How businesses can achieve greater success with resilient Supply Chain management
Case Study When Boeing announced plans to assemble the 787 Dreamliner in late 2003, it introduced a new concept to the assembly of a commercial aircraft. Instead of building the plane from the ground up, subcontractors from around the globe would deliver completed subassemblies to Boeing’s factory in Everett, Wash. for final assembly.
The approach was intended to create a leaner manufacturing process however,- ▪ Development of the new aircraft was beset by numerous supply chain related disruptions ▪ Events that interrupted the flow of products and information between raw materials, production, and the end customer. One of those disruptions occurred in January 2013, when the Dreamliner was grounded by the FAA due to overheating of its new lithium-ion battery.
• As a result, Boeing needed to slow production of this innovative aircraft until it determined the source of the overheating - a source that appeared to lie within in its supply chain, according to news reports. • The question for Boeing was how quickly it could identify the source of the overheating and recover from the disruption • At bottom, that was a question of how resilient the Dreamliner supply chain was. Boeing is not alone.
“Resilience is at the heart of current supply chain management thinking, and understanding the concept, and where to invest in resilience, can lead to supply chains that quickly respond to and recover from costly disruptions.” Supply Chain 24/7
Resilience in Supply Chain Management Supply chain resilience is “the ability of a supply chain to both resist disruptions and recover operational capability after disruptions occur.” Viewed from this perspective, resilience consists of two critical but complementary system components: the capacity for resistance and the capacity for recovery
• Resistance capacity is the ability of a system to minimize the impact of a disruption by: • evading it entirely (avoidance) • minimizing the time between disruption and recovery • Recovery capacity is the ability of a system to return to functionality once a disruption has occurred. Usually characterized by: • stabilization phase after which a return to a steady state of performance can be pursued. Both capacities are based on the resilience of an entity’s Supply chain structure
Statistics • According to a survey by Deloitte from 2014, 79% of companies with high-performing supply chains achieve revenue growth superior to the average within their industries. • Conversely, just 8% of businesses with less capable supply chains report above-average growth . That figure highlights like no other how critical the interrelations are between an entity and its supply chain. • Given that something like 50% of businesses, regardless of their size, fail or close down within five years of launch, it can be deduced that poor supply chain performance commonly contributes to corporate or business failure . Similarly, one can assume that in many cases, businesses that fail do so because of financial problems — a fact that makes the following statistic also worthy of consideration:
Supply Chain Management in Ghana • In Ghana and across Africa, Supply Chain in many indigenous businesses, have not been subject to a design process, but has instead just … evolved. • 44% of businesses in fail because of poor strategic management . Supply chain strategy is critical to business success, but companies often underestimate its importance and hence pay it less leadership attention than other areas of operation. • It is also common for the supply chain to be the least understood area of strategic business management, which for an activity generating up to 90% of overall business costs , is alarming indeed.
What does this mean Supply chain and its management are essential to the success of any businesses operating in today’s local and global markets.
• “Supply Chain Resilience is at the heart of current supply chain management thinking. Understanding the concept, and where to invest in resilience, can lead to supply chain that quickly respond to and recover from costly disruptions” Source : Understanding Supply by by Steven A. Melnyk, David J. Closs, Stanley E. Griffis, Christopher W. Zobel, and John R. Macdonald
1. Supply Chain Strategy/Design • A properly designed supply chain strategy is an enabler for achieving commercial goals and consequently, corporate success. • Your supply chain strategy should support the overall strategy of your business • Designing and implementing supply chain that can be configured and quickly respond to changes (especially the part dealing with outbound distribution from plants or warehouses) – Strategies to better manage suppliers at all levels – Supply base configuration – Choosing flexible partners
2. Discovery Invest in the ability of the firm to identify problems in the Supply Chain – Improved IT and Information sharing – Early warning by supply chain partners – Forecasting – Demand sensing – Monitoring of performance in supply chain including ethics
3. Information Investment in improving the quantity, speed and quality of information flowing within the supply chain – IT dashboard monitoring – Effective Communication between teams – Information visibility pop ups - research
4.Buffer Creation of excess cushions in the form of inventory, capacity and lead time – Inventory management – Excess operating capacity – Safety stock
5. Operating Flexibility Changing flows or product specifications in response to supply chain problems – Transportation alternatives – Variable bill of materials
6. Security Protecting the system from supply chain shocks in the form of theft, damage or counterfeiting – Firewalls – Quarantine – Strengthening physical systems
7.Preparedness Designing contingency plans for supply chain shocks and testing of plans so the various groups know what their specific responsibility are – Contingency planning – Training/Rehearsals – Risk Assessment – Risk Insurance
8. Indirect Investments Applying investments in other areas that can be drawn on when shocks occur. Typically these create goodwill or a willingness to let the firm address its supply chain problems – Market positioning/Brand equity – Supply Chain capital – Relationship with Supplier – Relationship with customers – Supplier loyalty – Customer loyalty – Support for Innovation – Support for Dynamic partnerships – Revenue management
MRS EVELYN SAM (CHIEF SUPPLY CHAIN OFFICER, AIRTELTIGO) This compilation is the work of Supply Chains Connect (SCC) and the content therein are the sole property of the individual speakers who presented at the Supply Chain Conference 2019 on 6th December 2019, in Accra. The knowledge, views and insights shared are the speakers’ individual knowledge, views and insig hts and not that of the companies they work for. No part(s) of this document is to be reproduced, copied or shared in any form without the express permission from the speakers through SCC.
THE ETHICAL SUPPLY CHAIN Mrs Evelyn Sam
CONTENTS What is Ethics ? Why is there a need to discuss Ethics ? Ethics in the SCM environment Setting the right tone Principles of Supply chain Ethics Benefits of an ethical Supply chain Risks of unethical behaviour Way forward Conclusion Mrs Evelyn Sam • Mrs Evelyn Sam
Ethics ??? Difference between having the right to do something & doing what is right Mrs Evelyn Sam
Ethics ??? What is good or right in human relations. Mrs Evelyn Sam Mrs Evelyn Sam
What is Ethics ? Ethics ??? ➢ Moral principles that govern a person's behavior. ➢ The way we do things …even when no -one is looking. 57 Mrs Evelyn Sam
Consider the followin ing questions . . . . . . . . . 1. Can one be an unethical person at home and still be ethically effective at work? 2. Is being an ethical person sufficient for being an ethical leader? 3. Can ethics be “managed” ? 58 Mrs Evelyn Sam
Ethics is often perceived as a GREY AREA where there is little clarity about what is right or wrong RIGHT, WRONG & DILEMMAS Right Dilemma Wrong √ ? X Mrs Evelyn Sam
Basic ic test for r decision-making QUICK TEST : ➢ Is it legal / procedural ? ➢ How will it look like in a newspaper? ➢ Is it consistent with my organizational / professional values? ➢ Is it fair to all? ➢ If I do it, will I feel bad? 60 Mrs Evelyn Sam
Why Ethics ? There are ethical challenges in Supply chain making it difficult for some individuals to be ethical 61 Mrs Evelyn Sam
There is is a need to dis iscuss Ethic ics . . . . . . ➢ Equip teams with a way of ‘thinking’ about ethics in all transactions ➢ Give the teams some exposure to what is required in terms of ethics in Supply chain … ➢ Help teams to understand their role as Supply chain staff promoting an Ethical culture 62 Mrs Evelyn Sam
“Ethics can’t manage itself” structures Building an Ethical Supply chain requires: ➢ Structures , Processes, Policies & Procedures ➢ Staff with ethics expertise ➢ Continuous training ➢ Awareness creation Mrs Evelyn Sam 63
Ethic ics at the workp kplace The right choice isn’t always clear in today’s business. One cannot assume employees will make the right decisions. Employees perform a delicate ethical balancing act every day. Ethics form a crucial part of employment ➢ affecting profitability ➢ high morale and teamwork . . 64 Mrs Evelyn Sam
Ethics in Supply chain ➢ Supply chain has taken on a more critical role in the corporate world. It’s no longer a back -office function ➢ Activities must be conducted according to signed off procedures ➢ Today SCM is a strategic and a competitive differentiator that has become part of the business model. Mrs Evelyn Sam
Engaging vendors It is expected that Suppliers must be able to demonstrate their alignment to the Code of conduct to ensure responsible business practice ➢ Workers’ Rights & Protection ➢ Prohibition of Child Labour ➢ Environmental Protection ➢ Transparency ➢ Whistleblower Policy 66 Mrs Evelyn Sam .
Conflict of interest • A conflict of interest may arise when personal interests, activities, or relationships affect an individual’s responsibilities and loyalty to the Company Mrs Evelyn Sam 67
Setting the right tone for an Ethical Supply chain environment. ➢ Structure to support the supply chain function o Due diligence o Contracts o Procurement o Inventory management ➢ Sign off all agreed policies with key stakeholders ➢ Regular Roadshows for all internal & external stakeholders ➢ Cross functional Committees set up to select vendors ➢ Periodic audit reviews 68 Mrs Evelyn Sam
The impact of supply chain ethics on business ➢ Even just a one-time lapse can harm both reputation and the bottom line. ➢ Today’s consumers demand to know that the products they purchase are made in social, ethical and environmental ways. Mrs Evelyn Sam
Examples close to home . . . . ➢ A supplier offers to give you and your manager tickets to attend the opening ceremony of the World Cup. ➢ Your manager says that he intends using the ticket. ➢ The supplier has provided you with good products for three years ➢ What do you do? 70 Mrs Evelyn Sam
Statistics on Ethical Supply chains ➢ Many companies need to focus on taking real action to improve their ethical supply chain practices. ➢ When respondents to a survey were asked how much progress their company has made in creating an ethical supply chain over the past two years, less than a third – 31% said they had advanced their initiative. ➢ And despite supply chain ethics being stated as important, nearly four in 10 organizations (38 percent) aren’t actively monitoring their supply chains for ethical practices. Mrs Evelyn Sam
Expectations of the Supply chain team ➢ Conduct oneself in such a manner as to maintain trust and confidence in the integrity of the acquisition process. ➢ Avoid “clever” practices intended to take undue advantage of others or the system. ➢ Uphold the organization’s standards and policies and all relevant legislation. ➢ Avoid conflicts of interest. Mrs Evelyn Sam
Mrs Evelyn Sam 73
Ethical sourcing ➢ Ensuring products being sourced are obtained in a fair, responsible and sustainable way ➢ Ensure workers involved in making products are safe and treated fairly ➢ Ensure that environmental and social impacts are taken into consideration during the sourcing process. Mrs Evelyn Sam
Pri rinciples of f Supply chain Ethics ➢ Avoid unfair trade practices ➢ Avoid exploitation of consumers ➢ Fair treatment to all Employees ➢ Avoid payment of bribes ➢ Do not accept kick backs ➢ Accept social responsibility ➢ Respect consumer rights Mrs Evelyn Sam
Features of Business Ethics ➢ Basic framework ➢ Code of Conduct ➢ Conflict of interest declaration ➢ Policies, Procedures & Processes ➢ Nominating an Ethics champion ➢ Anti Bribery & Corruption training ➢ Regular governance meetings Mrs Evelyn Sam
Eth thical concepts & & pri rinciples th that relate to Supply chain Loyalty Integrity Transparency Confidentiality Impartiality Fairness Due Respect diligence Mrs Evelyn Sam
Benefits of an Ethical Culture Investor Reputation Stakeholder trust confidence Access to Attract and retain Loyalty of Suppliers discerning markets talented staff / Customers 78 Mrs Evelyn Sam
Benefits of an Ethical Supply chain ➢ Better control of violation. ➢ Adherences to guidelines. ➢ Cultivates an atmosphere of teamwork. ➢ Provides higher productivity ➢ Protects the organization against legal actions ➢ Builds openness & integrity 79 Mrs Evelyn Sam
Risks of unethical behavior Risks of f unethical behaviour ➢ Scandal ➢ Losses due to fraud, theft & corruption ➢ Stakeholder alienation ➢ High staff turnover ➢ Stifle innovation ➢ Litigation / claims against company ➢ Liability of directors 80 Mrs Evelyn Sam
Way forward It is the obligation of managers to ensure that their team members comply with rules and regulations by creating and maintaining an Ethical Environment. To do this, managers must :- 1. Demonstrate the characteristics of an ethical manager 2. Communicate the Ethical Standards 3. Establish and Encourage Ethical Communication 4. Correct Unethical Behavior 5. Resolve Conflicting Ethical issues Mrs Evelyn Sam
Summary By embedding an ethical strategy, adopting ethical and social sourcing practices, companies can begin to feel confident that their sourcing processes are fair , not contributing to labour exploitation but enhancing supplier relationships and avoiding reputational risk. Mrs Evelyn Sam
In Conclusion . . . . ➢ A company’s ethics will determine its reputation ➢ Good business ethics are essential for the long- term success of an organization 83 Mrs Evelyn Sam
Mrs Evelyn Sam
FRANK MANTE (ACTING CEO, PUBLIC PROCUREMENT AUTHORITY, GHANA) This compilation is the work of Supply Chains Connect (SCC) and the content therein are the sole property of the individual speakers who presented at the Supply Chain Conference 2019 on 6th December 2019, in Accra. The knowledge, views and insights shared are the speakers’ individual knowledge, views and insig hts and not that of the companies they work for. No part(s) of this document is to be reproduced, copied or shared in any form without the express permission from the speakers through SCC.
HIGHLIGHTS OF AMENDMENTS TO PUBLIC PROCUREMENT (AMENDMENT) ACT, 2016 (ACT 914) FRANK MANTE – AG. CEO, PPA MENSVIC HOTEL, EAST LEGON 6 TH DECEMBER, 2019 Improving Efficiency and Transparency in Public Procurement
OUTLINE OF PRESENTATION By the end of the seminar, participants should be able to: • Understand the rationale for the introduction of Act 914 • Identify and appreciate the importance of some new provisions pertaining to Act 914 87
RATIONALE FOR ACT 914 • To take into account current international best practices aimed at enhancing the effectiveness in Ghana’s public procurement system. • To address the major weaknesses identified in Act 663 in relation to the categorization, membership and functions of entity tender committees. • To cede the functions of the Tender Review Boards to the Entity Tender Committees to ease concurrent approval process. 88
RATIONALE FOR ACT 914: CONT • To increase the thresholds for state owned enterprises who are mostly independent from government oversight and have to compete in a private sector. • To also increase threshold for high spending public institutions, e.g. BOG, Ministries, Departments and Agencies, Metropolitan, Municipal and District Assemblies etc. • Introduce additional methods of procurement/contracting such as Framework Contracting and procurement procedures such as e- procurement. 89
KEY SECTIONS AMENDED • S. 2 of Act 663 has been amended to include sustainability objectives in the nature of environmentally and socially sustainable objectives. Thus, any procurement should take cognisance of this very important policy objective of public procurement • S. 3 of Act 663 has been amended and MMDAs have been given a special mention under S.3 (l) as one of the bodies to be advised by the PPA. 90
KEY SECTIONS AMENDED: CONT. • S.10 of Act 663 has been amended to expand the scope of sources of funds available to the PPA. • S.13 provides a new section i.e. S.13(3) which requires the PPA to submit relevant reports affecting specific MMDAs for these to be debated. • The whole of Part Two of Act 663 which deals with Procurement Structures has been amended. • S.14(3) makes mention of Contract Administration as a critical aspect of Public Procurement 91
KEY SECTIONS AMENDED: CONT. • S.14(4) provides that the PPA may recommend new methods of procurement to the Minister where required • S.19 of Act 914 provides for a Procurement Unit to be headed by a qualified Procurement Personnel who should serve as the Secretary to ETC. • S.20 of Act 914 provides that ETCs shall be constituted in line with the Categories in the First Schedule p.g. 42 92
KEY SECTIONS AMENDED: CONT. • S.20A of Act 914 is a new section which provides for the functions of the ETC • S.20A(2) provides that any delegation by the Chairman and Member of ETC or TRC shall be made in writing • S20B provides for the functions of Central Mgt Agencies, MDAs, Subvented Agencies to include: ✓ Approval of procurement plans ✓ Review specifications ✓ Assist Head of Entities in disposal in line with the Acts 93
KEY SECTIONS AMENDED: CONT. • S.20C provides for the applicable thresholds limits for ETCs provided for in the 2 nd & 3 rd Schedules • S.20D provides that meetings of ETC shall be held at least once every quarter • S.20E provides for he establishment of a Tender Evaluation Panel • S.20F(2) provides that Tender Review Committee for MDAs is the Central Tender Review Committee • S.20F(3) provides that the Tender Review Committee for MMDAs is the Regional Tender Review Committee 94
KEY SECTIONS AMENDED: CONT. • S.20G (1)provides that a PE or Tenderer aggrieved by the decisions of the ETC can seek a review of this decision from PPA. • S.20G(3) a PE or Tenderer not satisfied with PPA’s decision can seek redress in Court. This has found expression again under S.78 (5) • The words Description and Lot have found expression under S.21 (a). • S.22(1)(a) has been amended to include professional, technical and environmental qualifications. Once again sustainability has been introduced. • NOTE: S.21(5) of Act 663 which provides against splitting or bulk breaking has not been repealed. • S.22A is a new section which provides for suspension of a supplier or Consultant on grounds of unsatisfactory performance, corruption or debarment 95
KEY SECTIONS AMENDED: CONT. • S 26 has been expanded to include the form of procurement proceeding and only such procedures as provided shall be used during the procurement proceedings • S.28 has been expanded to include additional subsections o-y • S.28(4A) is a new section which provides for nondisclosure of records of procurement proceedings particularly with respect to evaluation of tenders 96
KEY SECTIONS AMENDED: CONT. • S.28A is a new section which provides under S.28A(1) for reasons for PE cancelling tenders before deadline for tender submission. • S.28A(2) provides for reasons that a PE can cancel tenders afte r deadline for tender submission. • How does S.28A and S. 29 in Act 663 differ? • S.32A is a new section which provides for confidentiality of procurement proceedings. • S.34A is a new section that has been introduced. It provides for the methods of procurement and in particular, Framework Contracting. What issues come to mind? 97
KEY SECTIONS AMENDED: CONT. • S.38(2) provides for PPA to charge fees for granting approvals for single source and restricted tendering. • S.38(1)(c) is a new section that has been introduced to add to the reasons giving rise to the use of Restricted Tendering. This focuses on using RT when no tenders are received by the deadline for the receipt of tenders. • S.40 (2) is amended to include socio-economic policy after S. 69(2) (c) (i). • S.44 (7) has amended the period for submission of tenders from 2 weeks to 6 weeks. This is confirmed by the repeal of S.53(2). 98
KEY SECTIONS AMENDED: CONT. • S.47 (1) provides that it is permissible to cause an advert to be published on the PPA’s website or Bulletin. Note at a fee to be set by PPA • S.47(2) ITT to be published in at least 1 daily newspaper of wide national circulation • S.49 has been amended to introduce electronic procedures (e- procurement). Note: PPA to determine the price of tender documents See 49(4) 99
KEY SECTIONS AMENDED: CONT. • S.59(2)(g) of Act 914 introduces environmental factor as part of SPP. Note S.59 has been largely amended. • S.74(4) is a new subsection that has been introduced. It clarifies the need for financial proposals being opened only subject to approval of technical evaluation results by the entity (ETC). • S.78 (a) improves and expands the wording for review by the inclusion of Complaints or Administrative review 100
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