In this presentation, Procurement Insights' Jon Hansen and a panel of industry experts examine the challenges of implementing a risk management and compliance initiative, and how procurement professionals can collaboratively develop a sound and proactive go-to strategy for their organization.
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Implement Compliant Procurement with Risk Management
1. Whiteboard to Dashboard
Steps to implementing compliant and risk-free
procurement processes
Access an on-demand Webinar on this topic here:
https://zyc.us/2r73Dsz
3. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Presenters
Jon Hansen
Editor & Lead Writer
Procurement Insights
Sally Hughes
CEO
IACCM
4. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Jon Hansen
As the Editor and lead writer for the Procurement Insights Blog, Jon Hansen has
written nearly 3,000 articles and papers; as well as five books on subjects as diverse
as supply chain practice, public sector policy, emerging business trends and social
media
In addition to being a much sought after speaker and moderator internationally, Jon is
also the host of the highly acclaimed PI Window on The World Show on Blog Talk
Radio, which has aired more than 800 episodes
A two-time Ottawa Finalist for the Ernst & Young Entrepreneur of the Year Award, out
of a group of 15,000, Blog Talk Radio named Jon Hansen as one of their top 300
hosts
5. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Sally Hughes
Sally was recently appointed as Chief Executive Officer for the IACCM, supporting the IACCM
global team in pursuit of both the recognition of and excellence in Commercial and Contract
Management
Sally is an experienced and accomplished commercial and contracts management
professional, holding senior commercial positions at a range of corporate and multi-national
organizations. After gaining an Honors degree in Law, Sally spent her time in house in the
corporate sector, where she worked globally in the Telecomm and IT industries, before
establishing her own legal and commercial consultancy in 2007
Sally is passionate about enabling business efficiency and growth through contracting and
commercial excellence; she understands the need for robust business operations to drive
these efficiencies, together with the requirement for effective communication and collaboration
at all times
Whether in contract development, negotiation, training or general communications, Sally has
built a reputation for service excellence and responsiveness. Her focus is on the creation of
positive and successful business relationships, constantly striving to ensure that businesses
realize their true potential and value
10. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Poll Number 1
Who is responsible for managing risk in your organization?
Legal
Finance
Procurement
Not Sure
11. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
True or False?
“Firms with international supply chains confront a complex
web of sanctions and export controls imposed by the US
and the European Union (EU), among others. To avoid
getting caught in this web, it is essential that companies
develop and implement a compliance programme tailored
to the special risks associated with their supply chain and
operations.”
Financier Worldwide article, April 2017
12. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
It’s True Because…
“Firms with international supply chains confront a complex
web of sanctions and export controls imposed by the US
and the European Union (EU), among others. To avoid
getting caught in this web, it is essential that companies
develop and implement a compliance programme
tailored to the special risks associated with their
supply chain and operations.”
Financier Worldwide article, April 2017
13. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
It’s False Because…
“The worst-case scenario for identifying risks for a large
enterprise is having the few individuals tasked with risk
management, internal audit, or compliance duties
perform this process without input from the business.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
14. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
It’s False Because…
“While some suggested that the consequence of non-risk
management fell on the shoulders of their organization's
legal department, many believe that procurement is the
organizational body that will assume the blame.”
Horizon 2017 Panel: The Evolution of Supplier Risk Assessment and Mitigation – PI Window On The World (November 2017)
15. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
It’s False Because…
“The worst-case scenario for identifying risks for a large
enterprise is having the few individuals tasked with risk
management, internal audit, or compliance duties
perform this process without input from the business.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
16. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
It’s False Because…
“. . . create a comprehensive list of risks for the entire
organization… It is most effective and accurate when
personnel from different units and with various levels of
supervisory responsibility are involved.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
17. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Shared Destiny
“The July 20, 2007 Wall Street Journal published an article
titled, “A Key Strategy of Japan’s Car Makers Backfires,”
which begins:
For want of a piston ring costing $1.50, nearly 70 percent of
Japan’s auto production has been temporarily paralyzed
this week.
Blame it on kanban, the just-in time philosophy of keeping
as little inventory on hand as possible.”
For Want of a Nail: The Pandemic Effect – Procurement Insights (May 2009)
18. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Get the (Complete) Picture
20. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Poll Number 2
I have a thorough or detailed understanding of the risks my
organization currently faces relative to achieving its goals.
True
False
Uncertain
21. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Reward
“Understanding an organization’s mission and objectives is
critical to having an effective risk management program.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
22. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
… And The Risks
“These not only tell you what the organization wants to
accomplish, but also why it is willing to take risks to do
so. These serve as the backdrop and provide context for
an enterprise to assess and manage risk.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
23. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Risk is Inevitable
“Companies must take risks to generate value… it is
impossible to eliminate risk entirely.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
24. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
But…
“It is often said that the greater the risk, the greater the
reward. This statement is false. Continually taking
excessive risks will almost certainly lead to huge losses.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
25. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
… It Has to be Managed
“Organizational risk management is the discipline
employed to help an organization to operate at a risk level
that allows it to maximize its value creation.”
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
27. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Poll Number 3
I have a total or complete understanding of my
organization’s risk management strategy.
True
False
Uncertain
28. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Strategy For Success
“In the fields of observation, chance only favours the mind
which is prepared.”
Louis Pasteur - December 7, 1854
29. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Tale of Two
“Nearly a decade ago, lighting struck a Philips microchip
plant in New Mexico, causing a fire that contaminated
millions of mobile phone chips. Among Philips’ biggest
customers were Nokia and Ericsson, the mobile phone
manufacturers, but each reacted differently to the disaster.”
Managing Supply Chain Risk: The Nokia and Ericsson Case Study – Procurement Insights (May 18th, 2011)
30. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Tale of Two
“Nokia’s supply-chain management strategy allowed it to
switch suppliers quickly; it even re-engineered some of
its phones to accept both American and Japanese
chips, which meant its production line was relatively
unaffected.”
Managing Supply Chain Risk: The Nokia and Ericsson Case Study – Procurement Insights (May 18th, 2011)
31. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Tale of Two
“Ericsson, however, accepted Philips’ word that
production at the plant would be back on track in a week
and it took no action.”
Managing Supply Chain Risk: The Nokia and Ericsson Case Study – Procurement Insights (May 18th, 2011)
32. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Tale of Two
“That decision cost Ericsson more than US $400 m in
annual earnings and, perhaps more significantly, the
company lost market share. By contrast, Nokia’s profits
rose by 42% that year.”
Managing Supply Chain Risk: The Nokia and Ericsson Case Study – Procurement Insights (May 18th, 2011)
33. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
A Plan of Action
The following are five types of actions one can take to address a risk:
Accept – by accepting a risk, an organization decides to take no action and to deal
with the consequences if/when it occurs
Avoid – choosing to avoid a risk is when an entity forgoes certain activities that would
potentially cause the risk
Mitigate Risk – an organization mitigates a risk by adding controls activities that
reduce or eliminate the risk
Transfer – a company transfers risk by insuring for the potential impact of a risk or by
outsourcing the activities related to the risk to another organization
Exploit – an organization exploits a risk when the impact is positive by performing
activities that increase the likelihood of its occurrence
Can You Assess & Manage Your Organizational Risk? – Isaac Clarke (July 19, 2017)
38. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
CEH Credits
Attendees of today’s event will receive an email thanking you for
attending. In this email is the link to your CEH certificate and the
archive of today’s presentation
Continuing Education Hour certificate. CEHs are awarded to
attendees who participated for at least 50 minutes of the seminar.
You will receive an email within the next 24 hours containing your
CEH Certificate
39. Need more insights?
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"Whiteboard to Dashboard: Steps to implementing compliant and risk-free procurement processes"
can be accessed here: https://zyc.us/2r73Dsz
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