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Professional leaders say UK could be sleepwalking into another supply chain crisis

Monday, July 21, 2014

In the week that the Modern Slavery Bill enters committee stage in Parliament, the research reveals that 11%* of business leaders that have a supply chain think it is likely that modern slavery is already playing a role in their supply chains Research also indicates that business leaders do not understand their own supply chains

Only 18 months since the horse meat scandal began in 2013, consumers and businesses have reverted to a “don’t ask, don’t tell” policy on supply chains according to new research by the Chartered Institute of Purchasing & Supply (CIPS).

With the Government’s Elliot Review into the horse meat scandal expected in the coming weeks, almost three quarters (72%) of British supply chain professionals say they have zero visibility of their supply chains beyond the second tier with only 11% saying they have visibility along the entire chain. As a result, only 21% of supply chain professionals say that they are able to guarantee there is no malpractice in their supply chains with the majority (51%) saying the horse meat scandal has not led to supply chain risk being taken more seriously.   

With the Modern Slavery Bill entering Committee stage on Monday 21st July, 11%* of business leaders polled admitted that it is likely that modern slavery is already playing a part in their supply chain.

 This complacency is mirrored amongst consumers who rarely consider how products are sourced with 30%* taking the country of origin into account when buying consumer goods and only 25%* caring about how their products are sourced.

The research, which was carried out across consumers, senior business decision makers and supply chain professionals hints at a worrying disconnect between supply chain professionals and senior decision makers within businesses, the latter of whom are around half as likely to say their company’s supply chains are opaque (13%* compared to 27% amongst supply chain professionals).

The news comes at a time when supply chains are increasingly complex with CIPS’s own supply chain risk index showing a rapid growth in supply chain risk since the 2008 financial crisis with UK supply chains exposed to corruption, incompetence and human rights abuses committed across the world. 

David Noble, Group CEO of the Chartered Institute of Purchasing & Supply (CIPS) said:

 “Consumers and business leaders have entered into a “don’t ask, don’t tell” pact on Britain’s supply chains.

 “Neither consumers nor business leaders have learned the lessons of the horse meat scandal and are content to remain ignorant of the malpractice that could be operating throughout their supply chains.

 “If the Modern Slavery Bill is to have a chance of eliminating slavery from British supply chain and we are to avoid repetition of the horsemeat scandal, then we must empower procurement professionals within their businesses.

 ”A professional ‘licensing’ of all supply chain and procurement professionals is becoming critical to avoid the UK sleepwalking into another supply chain crisis.” 

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Notes to Editors:

 *All starred figures are from YouGov Plc.

 About the research

The research surveyed 3,406 individuals between 2nd and 14th May including consumers, senior business decision makers and supply chain professionals. This includes 588 senior business decision makers and 2,359 consumers polled online by YouGov, weighted and representative of GB adults (aged 18+) and business size respectively. This is in addition to 459 CIPS members at manager level or above, polled by CIPS.