Procurement must deal with increased supply chain risk, the rise of SMEs and ethical supply, said David Noble
Procurement must deal with increased supply chain risk, the rise of SMEs and ethical supply, said David Noble

Three burning platforms for procurement to 2030

posted by Jacki Buist
in Risk
20 October 2016

If procurement is to continue to influence, the profession must address the rise of SMEs and the future of a gig economy, where freelance employment becomes the norm over fulltime jobs.

This is just one of the three ‘burning platforms’ that must be dealt with in the coming years if the profession is to continue to lead and influence, said David Noble, CIPS CEO, at the CIPS Annual Conference 2016, today in London.

Growing supply chain risk and ethical supply are the two other issues of key importance for the profession from now until 2030. 

Noble said that, according to the Chartered Institute of Personnel Development, in the next 20 years, over 40% of jobs will not be salaried, people will be contracted in and out.

“And with the use of the internet, start up companies can move faster and 99% of start-ups are SMEs,” added Noble. “They don’t normally have procurement professionals… We have to recognise the skills needed by people who are not fulltime procurement professionals.”

Supply chain risk will increase, caused in part by Brexit, but also by other changes, such as the dramatic drop in global trade - which can be seen in the shipping industry and Hanjin - and the return of the silk road trade route. But turbulence is not new to the profession, he said.

He highlighted trends that will continue to alter the business environment. Artificial intelligence will affect the workforce, and there is clear evidence of changes in the business model, with ideas-based businesses that are making money without assets - think Uber and Airbnb - and the rise in non-tariff barriers and protectionism. Cyber security is one area that causes great concern, he said.

Noble talked about the importance of the procurement profession’s responsibility to be guardians of enterprise to protect them from risk. Too often, you know your first and second tier suppliers, but not the third, he said. With the Modern Slavery Act, CEOs must be aware of the risk to them personally. “You need to get serious with your procurement, or you could go to jail,” he said.

Noble was launching a white paper “CIPS Supply Century, Defining our future profession”, and invited members to submit comments on it. CIPS also launched a hard copy good practice guide to Supply Chain Risk and Resilience.

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