Awareness in Business

The following may be a ‘wake-up-call’ to some, frustration (due to lack of time) to others, or a realisation that your business needs to ‘up-the-anti’ when it comes to procuring goods and/or services from a third party.

Caveat Emptor – is a well known Latin phrase used by the purchasing and procurement fraternity and means ‘Buyer beware’

If you are responsible for the acquisition of goods or services on behalf of your employer or customer you should be conversant with the applicable legislative requirements that are in place to comply with, and adhere too. You should also be aware of (and using) the tools available to protect you as an individual from any infringement or breaches that could occur whilst carrying out your role, and the potential consequences if you fail – which at best will be distasteful and at worst the possibility of legal action.

If you are the employee bequeathed with this responsibility you are expected on behalf of your organisation to ensure that all acquisitions are conducted and completed, satisfying the appropriate legal requirements and complying with your business processes (commonly referred to as Governance) ensuring compliance in all transactions at all times.

But how and where do you begin being proactive in protecting your organisation from the vast amount of governmental imposed legislation applied throughout the supply chain ensuring that, for example not only product safety and environmental sustainability is understood but also demonstrating that everything reasonably practicable has been checked and assessed to prevent a ‘Breach’ or ‘Failure’ in acquiring the goods or services. Whilst you may understand your personal obligations and exposure where corporate manslaughter is concerned, are you aware for example of the consequences of the latest Act covering ‘Bribery’ – unfortunately ‘we only know what we know’.

These risks and many more can be substantially reduced by asking these three important questions

  • Do we have a robust supplier approval process?
  • Do we restrict our purchasing team to only procure Goods or Services from our ‘Supplier Approved’ data base?
  • Do we regularly refresh and continuously monitor each supplier to maintain all held data as “current”?

If the answer is no to any of the above, we can help, but the above three questions undermine the reality of this complex and time consuming activity. There is the understanding of the key requirements which need to be established to provide a robust supplier approval process to be considered. The removal of the ability for uninhibited spend and then maintaining control of the acquisition of Goods or Services from your ‘Approved Supplier’ data base (assuming one exists), and finally the need to regularly refresh and continuously monitor each supplier to maintain all the retained data as being “current”.

  • The design of the process
  • Identification of the technology
  • Method to be used
  • Compatibility with existing software and hardware
  • Installation and uploading
  • Training
  • Implementation (planning/tracking/Delivery)

Having spent the last 30 years in senior business roles the writer recognises that the procurement and supply chain professionals mainly operate under considerable time constrains and therefore are not always fully compliant with all aspects of vendor checking and appraisal prior to engagement. It is also understood that all businesses wish to engage with the highest calibre supply chain partners, contractors and suppliers who are committed to being both business and legislative compliant.

If you would like to learn more on how we can help you obtain ‘effective supplier data’ and become a ‘Centre of Excellence’ in supplier engagement and management please contact us.

We are here to help.

AN EXAMPLE

All organisations with 5 or more employees are required by UK law to have:

  • A documented health and safety policy
  • Documented risk assessments for all significant hazards
  • Access to competent health & safety advice
  • Documented arrangements for the planning, organisation, control, monitoring and review of health & safety arrangements (i.e. a health & safety manual)
  • Adequate health and safety training for managers and employees

The penalties of not complying with health & safety law is serious with the following potential consequences:

  • Unlimited fines, to be paid straight from profits
  • Individual fines and jail sentences
  • Director disqualifications
  • Publicity of prosecutions, leading to loss of orders and the risk of reputation damage.
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