Top and Significant Challenges Facing Procurement Today
Just like any other tasks in the modern business world, evolution has been evolving significantly over the years just like anyone would expect. Today, procurement is no longer just about sourcing services while minimizing costs. The modern procurement team, in fact, faces a wide range of complex challenges that they have to deal with before achieving their goals. This article outlines some of them as seen below. Contact E-Procurement Challenges and Solutions to avoid these challenges.
Risk management
Risk is among the leading concerns for procurement for not only suppliers’ financial status as a primary focus but also health and safety as well as industry practices. It is no longer adequate for some to just engage with one’s tier-one suppliers but emphasis must be put to the controlling approach that is taken with the two-tier suppliers which ensure that all the necessary obligations are put in mind by the subcontractors.
Brand image and reputation
It is another challenge that people have to deal with in procurement today. It is not so difficult to recall allegations of child labor in the overseas supply chain of some specific retail brands as well as issues around modern slavery not just at home but abroad as well. There is always a knock-on impact that ends up disrupting the brand as well as the brand image and eventually impacts profitability. The Modern Slavery Act goes a step higher in addressing the above but then issues come in at compliance in the long run. Learn more about this firm here: https://visichain.io/e-procurement-challenges-and-solutions/.
CSR
One of the most popular questions that people keep asking is if procurement can ever be sustainable. Businesses keep making tremendous progress in the market today especially in the approach to direct materials but on the contrary, the biggest challenge comes in indirect procurement that is so complex and complicated. The auditing level required to practice the latter and ensure that it remains sustainable not just for the first but also the second level tier suppliers is not just time-consuming but also labor-intensive as well. One should consider asking suppliers to complete all the detailed questionnaires and also take positive action with the results in the picture. The most organization now issue a written code of conduct but the primary challenge is acceptance as well as practical application in their supply chain. Other challenges also lie in how one works to become a customer of choice as well as a center of excellence in addition to how to engage all the stakeholders and so on. Learn more about e- procurement here: https://en.wikipedia.org/wiki/E-procurement.
