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In an era where global supply chains are under increasing scrutiny, businesses are seeking innovative solutions to manage their suppliers and materials more effectively. The focus is not just on operational efficiency but also on complying with various regulations and embracing sustainability. This guide aims to offer valuable insights into selecting the right software to manage your supply chain, ensuring compliance with laws like the Supply Chain Act, CSDDD, EUDR, Modern Slavery Act, and more, while also convincing stakeholders of the project's value.
Compliance with supply chain regulations is a daunting task. Laws and regulations like the Supply Chain Act and Modern Slavery Act require businesses to have a deep understanding of their entire supply chain. This includes detailed requirements for due diligence, which may be overwhelming for many companies. One must consider whether it's feasible to handle these requirements in-house or if it's more practical to rely on specialized external services like Sedex/SMETA or Ecovadis for audits and evaluations.
To truly add value to your business and enhance your team's work, integrating as much data as possible into your supplier evaluation process is crucial. This includes internal data such as sales, on-time delivery rates, raw material quality, and documentation completeness, along with external data like audit performance and country risk assessments. A well-integrated data model not only brings relevance and acceptance to your project among colleagues and suppliers but also ensures flexibility to meet the unique needs of each business.
Maintaining an updated list of suppliers through your enterprise resource planning system provides insight into your direct suppliers. However, without integrating information from supplier and raw material documentation, it's challenging to trace your supply chain beyond the first tier. Relying on basic databases or manual updates of certificates turns into an inefficient process, highlighting the need for a more sophisticated solution to manage and analyze data systematically.
Creating an integrated and efficient solution requires the collaboration of all departments within a company. Solitary solutions quickly become a mere compliance task with little added value for the business. By working together, departments can achieve significant efficiency gains, transforming supply chain management into a comprehensive and valuable function.
When selecting software, simplicity is key. Focus on essential features like automated documentation of suppliers and materials, audit readiness, and seamless cross-departmental collaboration. Be wary of expensive solutions that promise much but deliver little in terms of core needs. Remember, the software is a tool to be fueled by data, and it alone cannot fulfill due diligence obligations under supply chain law.
Identifying and engaging key stakeholders early in the project is crucial for its success. Understanding the benefits for different parties and finding allies among decision-makers is essential. When presenting the project to management, highlight potential efficiency improvements and compliance as not just a regulatory necessity but a strategic advantage. Demonstrating the daily operational challenges and risks associated with current practices can underscore the need for a more streamlined and automated system.
Planning and implementing a new software solution for supply chain management requires considerable upfront effort. However, this investment pays dividends in enhanced efficiency, compliance, and sustainability. By engaging stakeholders, demonstrating the value to the business, and choosing the right software, companies can navigate the complex landscape of supply chain management successfully.
Bernd possesses extensive experience in strategic procurement, shaped by his tenure at Eckes-Granini, Symrise and DuPont de Nemours. Currently, he is focused on sustainable sourcing and supply chains, collaborating with the relatico team to develop practical software solutions. Additionally, Bernd runs his own agricultural business and is involved in supply chain projects globally.
