Use 'big ticket' projects to develop suppliers

10 May 2012

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10 May 2012 | Adam Leach in Johannesburg, South Africa

Purchasers should use large projects and programmes as an opportunity to develop the capacity and expertise of their suppliers, according to the procurement chief at Petro SA.

Speaking at the CIPS Pan African Conference 2012 in Johannesburg, Comfort Bunting, group supply chain manager at the state-owned fuel company explained to the audience of buyers he was using the construction of its largest ever oil tanker as an opportunity to build contractors’ capabilities. He said it was important to develop capabilities in the right areas. “In terms of supplier development, look to the big ticket items,” he advised.

During his presentation, Bunting also recommended buyers take steps to ensure sub-contracting by suppliers was done in an open and transparent manner. As Petro SA is state funded, it implements a number of measures to reduce the risk of corruption. But work that is sub-contracted by a supplier in a non-transparent process creates the risk of corruption.

Further, he said an open and transparent tendering process was an effective method of minimizing the potential for political pressure, or bias in relation to the awarding of contracts. By doing it in public, through a competitive process, there is no opportunity for interference.

Discussing broad-based black economic empowerment, Bunting said purchasers needed to make sure people understood it did not contribute to corruption. He revealed he had completed a study which found 50 per cent of people, evenly split across races, believed that it increased to corruption.

“Our job as supply chain professionals is to find a way to explain it so people don't believe that it adds to corruption,” he said.

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