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Course 4 Supplier management (Ánh) - Coggle Diagram
Course 4 Supplier management (Ánh)
How medical supply chains can diversify beyond COVID19
The pitfalls of low-cost, single source commodity supply chains.
Paying low prices for products allows for strong cash flow and ledger numbers
Certain countries and regions
the prime sourcing
manufacturing locations for drugs
for personal protective equipment (PPE)
testing supplies
The test kit swabs are produced in Northern Italy
Premier sources exam gloves from Malaysia
PPE from Cambodia
face masks from China and Taiwan
Mask manufacturers:U.S. and Canadian companies producing in China
Forced to sell their products exclusively to the Chinese government
Skyrocketing demand, plummeting supply
The FDA has not reported any medical device shortages
The FDA now lists more than 100 drugs currently in
shortage
demand for sedatives
pain medications
anesthetic paralytics as a result of COVID-19 hospitalizations
increased ventilator usage.
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amping up supply still takes time
polypropylene used in N95 respirators is in short supply globally
Tackling supply chain diversification
Enhance transparency
The lack of transparency is coming to light
healthcare supply chains often don’t know where the raw materials come from
Increase U.S. and near-shore manufacturing
During a 2012 shortage, Premier worked with a distributor to get supplies
bringing in redundant suppliers to stabilize the market
After Hurricane Maria in 2017
saline and saline bags were in short supply
electrical grid was hit hard
the manufacturer, Baxter, had a hard time regaining market share
Increasing manufacturing requires more infrastructure
short-term costs to pay for that redundancy
Leverage AI capability
data and technology may be able to help identify shortages
other reasons for the change
Cost and risk: A balancing act
Will companies actually change their sourcing?
more U.S. CFOs plan to change their supply chain range
about one-third of those surveyed: supply chain issues are one of the top-three concerns
Navigating supplier relationships in the COVID-19
era
leading to canceled
invalidated or ignored contracts
Five Easy Steps To Risk
Management in Procurement
Risk Analysis
Risk Ranking
Risk Identification
Risk Mitigation
Risk Monitoring
Price Stability: Don’t Get a Nasty
Surprise
strategic sourcing
strategic buying
Procurement strategies
indirect sourcing
PESTLE analysis
Mitigating the Risk
GPO
CPI
challenge price increases
Selecting A Vendor
Define
The process of due diligence and evaluation of potential suppliers by quantification
Choose the right supplier
Purpose
To ensure that the production and business of enterprises are not interrupted and to promote continuous improvement.
12 vendor selection criteria
Appropriate supply of internal experts that can
answer questions you may have
Testimonials and references
Substantial catalogue of products or range of
services
Sustainability and financial stability
Flexibility to allow changes
in orders or product lines
Prices
Ability to supply all the
products required or the
complete solution
Delivery times
Ability to constantly
supply products or services
Terms of business
Years in business
Customer service
Supplier Evaluation
WHY MEASURE SUPPLIER PERFORMANCE
Uncover and remove hidden waste and cost drivers in the supply chain.
Leverage the supply base
Increase performance visibility
Align customer and supplier business practices
Mitigate risk
Improve supplier performance
advantages and challenges of various approaches to supplier performance measurement
Make the business case for supplier evaluation
Determine approaches and metrics
Recognize and uncover hidden cost drivers in the customer-supplier relationship
Understand the merits and shortcomings of various approaches (i.e., is ISO certification
adequate? Are quantitative metrics from your enterprise system sufficient?)
Identify actionable supplier opportunities for improvement
Understand where automation can scale and support your processes
Close the loop and get results
APPROACHES TO EVALUATING SUPPLIERS
Scorecards
Requires resources for cleansing, massaging, formatting
Disputes with suppliers over data integrity
Data integrity
Not clearly actionable
Do not identify root cause
Site visits
Requires trained personnel
Site visit instrument & expertise
Resource intensive
Can be inconsistent
Hard to scale the process
Questionnaires
Involves funds outlay
Resistance to change
Third-party standards certification such as: ISO
9001:2000, ISO/TS 16949:2002, QS9001
Focus on documenting procedures
Not specific to customer requirements
Does not guarantee best practices
Supplier evaluation software
Difficult to deploy
Relevance of results
Hard to construct sound survey instruments
Not always actionable
Requires knowledge of what to measure
Supplier compliance issues
Writing Good Contracts Matters
Specify the project plan, schedules and milestones
Specify where the deliverables will be performed
Seek input from the right people at the right time
Avoid making any unintended (implied) warranties
Anticipate changes in needs or circumstances and decide
how these will be addressed
Specify the standards of performance requirements
Clearly specify the objectives to be achieved
Specify the applicable testing or acceptance criteria
Develop a well-organized table of contents
Avoid incorrect, inconsistent or contradictory statements
Link payents to performance or progress
Develop an order of precedence for the contract documents
Learn from and do not repeat mistakes
Anticipate the need for interpretation and who’s judgment will govern
Define what is to be performed
Risk Management-Part 1
gotta be prepared to grab risk management
before it grabs you
to risk management
to have very good plans in place
management plans
address when issues come up.
need to think broadly
isn't just about suppliers
got to incorporate risk management into your strategic sourcing planning
want to have a risk identification,
need to assess and prioritize risk
etermine where the risk is
have a contingency plan
have some sort of review process
Risk Management-Part 2
need some sort of continuous improvement plan
report back in the next month
ticked off some of those items
have supplier meetings all the time
either face-to-face
use a lot of video type
trying to mitigate these risks
some sort of ongoing reviews with the suppliers
have good trust with your supplier
reduce risk together.
lsupplier mapping
a way to determine what's going on in the market
see going from the middle blocks out
is your suppliers
and their suppliers and many other sources
looking backward in the supply chain, try to identify risks
managing supplier risk is your job
don't assume somebody else
grab risk management by the horns before it grabs you.
Supplier Selection and Management-Part 1
how do we select and evaluate suppliers?
selecting and evaluating suppliers
tremendous amount of information.
where their plant is located,
What type of company they have
learn about their management, are they unionized
learn about their financials
met suppliers
from a sourcing strategy
from product development,
request for quotation
about the lead time
what type of transport
Supplier Selection and Management-Part 2
key supplier evaluation criteriaProcess and technological capability
about cost
evaluate the supplier on his total cost .
and look for opportunities to work together
reduce cost
able to make comparison across multiple suppliers
financial stability is one of the key criteria.
can pick a third party together
some accounting firm
evaluate and give us the highlights
know how secure the customers are.
make sure that they're going to put that investment
Process and technological capability
look at what their percent of investment in R&D
What percent of money was going in?
do supplier managed inventory.
developing a supplier evaluation system.
use your stakeholders or your cross-functional team
using the supplier evaluation system
types of supplier evaluation spreadsheets.
Supplier risk management
Complex arrangements realise new risks
Reputational risk
due to a service or supply interruption
a supplier safety or quality failure
a supplier’s business practices
Resilience risk
The risk that a supplier failure results
an interruption to customer service
Information security and privacy
The risk that sensitive data
customer data
compromised by a cyber-security breach
failure in a supplier company
Regulatory risk
The risk of non-compliance with the regulatory requirements
the commercial undertakings associated with sourcing
outsourcing or offshoring arrangements in the jurisdictions
Commercial risk
The risk of financial loss
cost overruns from poorly managed sourcing arrangements or supplier failures
supplier failures
inaccurate billing from outsourced parties
Possible supply chain risks
Complex arrangements realise new risks
Socialethical &environmental
Child labour
Ethical practices
Health and safety
Resource consumption
Waste
Financial
Exchange rates(volatility)
Raw material prices
Energy prices
Penalties
Accuracy of billing
Commercial
Competition
Labour costs
Strategic
Reputation/brand
Compliance
Macro economic
Geopolitical
Investment
Legal/regulatory
IP/food fraud
Change programs
Market changes
Operational
Food safety
Demand planning
Quality standards
Logistics
Contracts
Delivery performance andlead times
Controls
Securit
Continuity
Supplier financial failure
Food security
Natural hazards
Terrorism/food defence
Poor management
Key dependencies on personnel/suppliers
The best practice response
A more reliable and consistent process for managing supplier risk
Competitive differentiation through a transparent purchasing policy
Increased operational efficiency and reduced costs through centralised contract management
An enhanced ability to outsource noncore activities
partner with strategic suppliers on key activities
A reduced need to replace failed suppliers
Are you managing supplier risk effectively?
all stages and suppliers in your supply chain
suppliers to provide details of their own sourcing/outsourcing and offshoring arrangements
regularly monitor the operational, ethical and financial risk and performance of your suppliers
supply chain complies with the relevant regulatory and legal requirements
management take a risk-based approach to assessing and managing supply chain risk
management that you are operating within your supplier/offshoring/outsourcing risk appetite
you can respond to any supply chain disruption without unacceptable loss
you are not being defrauded by employees and/or suppliers
receive robust assurance that all key risks are managed in your supply chain
Principles and Standards of Ethical Supply Management Conduct with Guidelines
Perceived Impropriety
Maintain business professionalism.
Work to identify situations which.
Discuss an actual or potential impropriety with management.
Promote actions throughout the organization.
Select outside business and event venues with care.
Avoid excessive discussion of personal matters.
Conflicts of Interest
Potential Conflicts
Guidance on Conflicts
Conflict of Interest Statements
Secondary Business/Employment
Personal Business
Investments or Business Ownership
Inside Information
Outside Activities
Issues of Influence
Employer Policies
Supply management professionals should encourage and recommend the development
implementation of policies that eliminate
reduce inappropriate influences on the supply process.
Gifts, Gratuities and Entertainment
Manage and evaluate carefully the acceptance of gifts, gratuities or entertainment
onsider the frequency of giving or receiving gifts and measure the “collective impact.”
Ensure that you abide by the letter and the spirit of guidelines
Do not solicit gifts, gratuities or entertainment for yourself, your employer or your family
Avoid accepting monies, loans, credits and preferential discounts
Seek direction from management if you are concerned that a business relationship may be impaired
Business Meals
Share ongoing meal costs with the supplier.
Use care to ensure a meal is for a specific business purpose.
Avoid frequent meals with the same supplier.
Relationships
Avoid situations where relationships may negatively impact business decisions
Product Samples
Clarify the responsibility for the cost of samples and address any obligation.
offered by suppliers or requested by the buying organization for testing.
Document transactions covering the acceptance and use of product samples.
Political Matters
Are subject to internal and external forces and pressures.
Internal forces and pressures result from an organization’s culture.
External forces and pressures result from economic conditions, laws, regulations, public opinion, special interest groups and political entities.
Advertising
Exercise care when accepting advertising or promotional items.
Participating in activities that promote one supplier over another.
Activities that could be perceived as preferential treatment.
Market Power
Supply management professionals must be aware of their organization’s position.
Ensure that this position is used within the scope of ethical behavior.
Specifications and Standards
ensure that specifications and standards are objectively developed and communicated.
Responsibilities to the Employe
Understand the agency authority granted by your employer.
Obtain the maximum value for your employer.
Avoid activities that compromise, or create the perception of compromising.
Notify your employer of known or suspected unlawful or unethical activities.
Avoid unauthorized use of your employer’s name.
Avoid using the employer’s purchasing power to make purchases for specific individuals’ non-business use.
Supplier and Customer Relationships
Develop and implement policies and procedures for business processes that are fair.
Encourage prompt and fair problem resolution.
Avoid unreasonable demands.
Communicate promptly, openly and directly.
Establish a process for suppliers and customers to notify your employer of known.
Social Responsibility and Sustainability
Recommended guidelines for support of diversity and inclusiveness — workforce.
Drive employee diversity within the organization.
Proactively promote diverse employment practices throughout the supply chain.
Recommended guidelines for support of human rights.
Treat people with dignity and respect.
Support and respect the protection of international human rights
Lead the organization and its supply chain
Recommended guidelines for support of the environment.
Encourage the organization to be proactive in examining and implementing opportunities
Encourage environmental responsibility
Promote development and diffusion of environmentally friendly (“green”) practices
Champion consumption of environmentally responsible products and services
Design and redesign products and services
Develop a complete understanding of the organization’s environmental footprint
Implement market intelligence capabilities
Recommended guidelines for support of diversity and inclusiveness — supply base
Provide socially diverse suppliers the opportunity to participate in sourcing opportunities.
Promote inclusion of diverse suppliers in the organization’s supplier development and mentoring programs.
Ensure long-term program sustainability through application of forward-thinking concepts beyond price.
Confidential and Proprietary Information
Develop and communicate a policy regarding protection of confidential and proprietary information.
Mark and identify confidential and proprietary information
appropriately.
Use nondisclosure agreements that state the terms for use of confidential.
Accept no confidential or proprietary information unless you have the right and need to use it.
Protect confidential and proprietary information given to you.
Use confidential and proprietary information only for its intended purpose.
Reciprocity
Understand suppliers that are also customers may not be a problem if the customer/supplier is the best source.
Use care with supplier lists and ensure they are not provided to others.
Apply and obtain accounting, legal and ethical guidance when potential issues.
Recognize that forcing a supplier into a trading relationship is not appropriate.
Recognize that reciprocal relationships may be an illegal restraint of trade in some countries.
Applicable Laws, Regulations and Trade Agreements
Seek training in legal aspects that govern conduct of supply management professionals.
Supply managers are responsible for understanding and following laws, regulations and trade agreements.
Interpreting the laws is the responsibility of legal counsel.
Supply managers must understand and apply laws that are specific to their particular governmental body.
Professional Competence
Conduct periodic self-assessments.
Establish a self-development program designed.
Mentor and teach those who want to learn from you.
Earn and maintain the Certified Professional in Supply.
Become actively involved in a supply management and other professional associations.
Encourage, support and participate in ongoing ethical training.
Encourage ongoing professional development of employees.
Personally adopt and promote the ethical standards expected.
Contract Management
reciprocity
restraint of trade
some legitimate formats criteria to be evaluated by a supplier's capability
the bank is buying things from the supplier
The sales people are trying to sell bank services
making the right procurement decision
communicating a process properly to all suppliers
personal buying
got a policy covering
Accepting supplier favors
when people get gifts and gratuities
Sharp practices is when you kind of use some misinformation to get results
Financial conflict of interest
Personal conflict of interest
So how do you support ethical behaviors
most companies today have some sort of procurement policy and procedures manual
Showing a top management commitment that this is serious stuff