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Five compliance techniques that guarantee poor supply chain operations

Posted by Gary Plant on Mar 30, 2016 9:30:00 AM

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Have you got ambitions of creating an inefficient and broken supply chain? Of course not. But the actions that some supply chain managers still undertake mean they’re putting their business, suppliers and contractors at risk too.

Whether you’re simply time poor to complete all the tasks, or feel like your processes need updating, here’s five compliance techniques that you should try and avoid at all cost unless you want to guarantee poor supply chain operations.

Supplier database on a spreadsheet

A spreadsheet to hold all of your supplier information just isn’t good enough anymore. As well as being harder to use and more chance of duplications and mistakes, it is also riskier to keep vital information in a document – no matter if its password protected or not.

Larger organisations that have more than one spreadsheet of supplier information can also suffer too. As well as taking more time to find the right information, the lack of standardisation amongst the several spreadsheets can cause confusion and potential mistakes internally too.

Not outlining requirements correctly

Outlining and agreeing on requirements with suppliers and contractors is often underrated. Yes, agreeing what you want the supplier or contractor to do is important, but there are additional requirements that you need to be clear on.

Health and safety, of course, is a requirement that requires additional outlining, especially if the work you require is at height. As well as outlining these requirements, you should also make note of the things you don’t want to happen as well.

For example, if your premises is nearby a school, work on repairing the roof before and after school hours as children are walking home may be restricted to avoid injuries or incidences.

Gathering unnecessary contractor information

Giving every contractor the same questionnaire to fill out their information is time-consuming and completely unnecessary. Asking contractors for their gas certifications, despite only being the company’s window cleaners is of no use to anyone.

Best Practice Guide to Supply Chain Compliance Now Available >

Instead, you should be tailoring your information to the new contractor you’re going to be working with. Window cleaners may not need to show certifications to work on gas maintenance, but they do need to draw upon insurance and certifications for working at heights – so collect this information instead.

Irregular supplier audits

There is no ‘set’ time to audit a supplier, although annual checks are a good place to start. A multi-layered approach with both desktop and on-site audits make sure you’re suppliers are both in check and in good health too.

Without such regularity, information such as financial, certifications and insurance documents could have expired – leaving you and your supply chain exposed to risks the supplier brings.

No new supplier references of certification checks

For new suppliers, you should be thoroughly checking their financial and insurance information already, but to assess their capability of carrying out the work they want, extra checks are required.

For specialist suppliers or contractors, certifications of their expertise such as an electrician, should be sought and kept on file (although spreadsheets aren’t the greatest to keep this kind of information on them!). Together with references from other organisations, certifications can offer a piece of mind that they will deliver the quality of work you desire.

Implementing supply chain best practice

With so little time, and so many suppliers and contractors to take care of, implementing supply chain best practice can be difficult. However, Altius have created a free eBook entitled ‘Introduction to Supply Chain Compliance Best Practice’ so you can get the basics in place.

Download your free eBook and see how you can better assess the capability of new suppliers, improve your supplier management and implement KPIs to improve supplier performance. Download your free Introduction to Supply Chain Compliance Best Practice here.

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Photo credit: Craig Chew-Moulding

Topics: Assessment Focus