By Nikita Saharia Chaturvedi
Organizations–particularly procurement teams–are relying more and more on technology to manage data. They are using technology to assess, analyse and have full visibility into their suppliers. “Many of our clients are making investments in technology to help support these needs,” says Rose Kelly-Falls, Senior Vice President, Supplier Risk Management at Rapid Ratings International.
“In addition, we are hearing more and more about the regulatory and compliance requirements many industries are facing.” This can be a drain on resources internally as organizations need to familiarize themselves with new requirements as well as implement and manage them – it is becoming overwhelming. Another emerging trend in 2015 is that procurement is now playing a much bigger role in risk management. In the past it seems that just attending risk-related meetings was the expectation, but now procurement is being asked to provide more guidance and insight to the business.
In fact, CPOs are being asked to act as an advisor as the risk strategies are being developed. This is a significant change compared to what we have seen in the past. Kelly-Falls tells My Purchasing Center in a new podcast interview, “We are being faced with more and more regulations and compliance requirements that we have not had to deal with in the past. This is new to us as professionals. This was typically something that another department handled.” Supply chain professionals are being looked to as the experts. “Yes, we have dealt with SOX but now with Dodd Frank and conflict minerals reporting, the OCC guidelines for financial institutions and even with drug supply chain security, we are knee deep and being required to take a much bigger role in risk and compliance,” Kelly-Falls says.
This is not going to go away. She suggests embracing the change but be prepared for more regulations as we move into 2015. In 2015 procurement should also be aware that they may need to have more and more visibility and transparency into the supplier base. “However, in order to achieve this and gain information you are going to have to continue to build very strong relationships with your suppliers,” Kelly-Falls says. And, perhaps more important, determining critical suppliers should not be done by spend.
“Organizations need to be thinking about the revenue impact that suppliers have on the bottom line,” she says. “That’s a paradigm shift for many organizations.” Kelly-Falls is active with the ISM Supply Chain Risk Management Group and, in the podcast, talks about what is on tap for in 2015. “Cathy Herr just finished 2014 as the chair, and we accomplished launching our new website which is hosted at My Purchasing Center,” she says. “Mickey North Rizza of BravoSolution is the 2015 chair. Mickey and the Board will be planning the 2015 Risk Conference which is scheduled to take place in Washington D.C. in June.
“That will be our major initiative this year. We are very excited about the speakers and topics, which we are about to finalize and release,” Kelly-Falls continues. “I can’t give away too many details but I promise there is more to come on this in the coming weeks.”
CONTENT IS KING 