Buyers must check risks at all supply chain stages

Adam Leach is a freelance business journalist
29 May 2013

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Procurement professionals should look for risks at every level of the supply chain and factor them into their strategies, according to a senior professional.

Addressing an audience of buyers in West Africa last week, Bola Afolabi, general manager at Nigerian National Petroleum raised the importance of buyers being risk aware. Highlighting issues such as the impact of kickbacks, sourcing from foreign countries and not keeping to agreed payment terms, he told buyers to look across the supply chain for risks.

He stressed that buyers must challenge themselves, as well as exploring various elements and parts of the procurement process: “Question yourself. Look for the risk in every level of the supply chain.” Other risks he picked out that buyers must be cognisant of included changes of ministers and leaders and the tendency for their replacement to change direction or scrap projects, delays in budgets, and bribery in the tendering process.

Afolabi, a former CIPS president, also told buyers that they would need to have a “thick skin” to work in procurement to counter issues such as corruption. He said that even friends and family might question why a buyer’s appointment to a senior position had not benefited them.

More directly though, buyers would need to show strength and honour to report corruption if they encountered it, he added.

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