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Procurement Challenges

Posted 10/19/2022

The environment including the legal, social, and economic environment continues to throw challenges to procurement professionals.

Inflation, supply chain, barriers to local preference, social and environmental responsibilities are just a few of the challenges we face.

Fixed price contracts and firm completion dates are difficult or impossible to mandate. Inflation is affecting living wage standards; updates are due next month. Climate change – fires, drought, and floods continue to dominate government planning. Materials and skilled workers are in short supply. Bidders are less tolerant of questionable practices and will challenge contract awards if they feel they have not been respected.

So, in this context what can procurement contribute to a solution matrix?

When planning supply requests consider:

  • ·        Asking for unit pricing rather than lump sum pricing
  • ·        Placing greater emphasis on quality and experience, less on price
  • ·        Allowing flexibility in completion dates
  • ·        Mandate a living wage for workers that is adjusted for inflation
  • ·        Research and plan for project specific supply chain issues
  • ·        Support your local marketplace where allowed (see my previous posting on this topic)
  • ·        Prepare for emergencies through creation of appropriate system contracts, inventory management, and enhanced supplier relationships
  • ·        Foster a reputation for ethical and transparent processes

Procurement professionals have always acted strategically. We can be proactive and ensure that our internal clients are on board with that.

I can assist.