spendmatters
 

February 07, 2012

 

Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 4)

Click here to read previous posts in this series: Part 1, Part 2, Part 3.

Apple has spent some time in the negative spotlight around the actions (or lack of actions) of its suppliers in the area of worker health and safety. Even recent coverage, such as the NYT story that describes in gory detail the results of an explosion at a Foxconn facility that tore apart the face of a college-educated technician working on equipment used in the manufacturing of iPads and iPhones, points to continued negativity in the mainstream press toward Apple's practices around health and worker safety. But is this negativity justified? We believe it likely is, if you adopt the perspective that Apple must adhere to global health and safety standards on the shop floor rather than Chinese ones (or lack of ones, for that matter).

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Commodity Edge Conference

The White House Talks Supply Chain: When Supply Risk Becomes a National Security Issue (Part 2)

In the first post in this series we covered and quoted many of the announcement factoids and underpinnings of the new National Strategy for Global Supply Chain Security announced by the White House last week. We'll continue to share some of the most important elements in this post, focusing first on some of the motivations behind the development of this strategy, and then how the White House intends to translate policy and supply chain analysis into action after planning is complete. We apologize again for quoting so extensively from the news rather than offering our own reporting and analysis, but we think there's no need to cloud the release with additional commentary.

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Exploring Basware’s 1stbp Acquisition: Virtual Printer Technology and Beyond (Part 1)

In January, Basware announced its acquisition of First Businesspost, one of the top e-invoicing network and software providers in Germany. For our initial insight into the financial and high-level solution, customer, competitive and marketplace dynamics of the deal, check out our initial coverage. After the announcement, we also caught up with Purchasing Insight's Pete Loughlin, and he provided a few other observations. He said that two things about the transaction are fairly obvious, but elements might be lost on those not close to the e-invoicing market.

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Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 3)

Click here to read Part 1 and Part 2 in this series.

One of the more substantial areas of disclosure in Apple's reporting its 2012 Supplier Sustainability analysis is in the area of conflict minerals. Apple provides a level of detail that is lacking in the rest of the report, especially when it comes to examining multi-tier behaviors and sub-SKU level material traceability. We might even describe Apple as an early leader in this area based on what we know are the early stage efforts of most other companies in complying with conflict minerals (Dodd-Frank) requirements. Specifically, Apple notes that it requires its suppliers "only use materials that have been procured through a conflict-free process and from sources that adhere to our standards of human rights and environmental protection."

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Getting Creative with Spend Analysis Datasets (Part 3)

Please click here and here for previous posts in this series. This series of articles is based on insights from the following Spend Matters Perspective: Spend Analysis -- Making Quantum Leaps: Exploring the Realm of Possibility and Untapped Savings with Three New Strategies.

In looking at the impact good data -- and analyzed good data! -- can have on contracting and supplier development initiatives, it's important to understand, just to use one example, how a lack of validation of rate cards and checking of invoices leaves an organization at risk on pricing. But in all cases, the aim should not be just to recover overcharges through analysis -- the key is to discover the underlying reasons for the discrepancies, and to ensure that the vendor is able to adhere to the agreed pricing in future. In this process, it is essential to make sure that the procurement resources leading the charge have access to the right level of detail and that rate card SKUs match invoice data.

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Spend Matters Spring/Summer Vendor Briefings: Combining Work and Play at Wrigley -- An Invitation

When I moved to Chicago ten years ago, one of the first things I did was register with the Chicago Cubs to get on the waitlist for season tickets. Having been a huge baseball fan and player when growing up in Philadelphia (and even on the "unofficial" JV team at Penn for a season), it's been a dream of mine for the past decade to get season tickets to arguably the most historic and cursed team in baseball -- within probably the best stadium ever built to watch the game itself (for everything else, Wrigley stinks, I'll admit). After a decade of waiting, the Cubs sent me a package saying our waiting list number was up and that we had to buy our seats or lose our spot on the list.

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Apple, Social Responsibility and Procurement: More CSR Pesticides or Going Organic? (Part 2)

Click here to read the first post in this series.

Based on Apple's 2012 Supplier Sustainability report, both in absolute and percentage terms, the largest increase in Apple's auditing programs appears in the "repeat audit" areas. This should not be a surprise, but rather a logical extension of marshaling supplier development efforts to focus on the largest suppliers that Apple continues to do business with. However, the level of first-time audits also hit an all time high for Apple, suggesting that they continue to work their way down to smaller and lower-tier suppliers. It would be fascinating to see the breakdown in results by supplier based on size, number of times audited and specific region, but alas, Apple does not provide us with these details. But it is worth noting that Apple did introduce two new categories of audits that it broke out separately for 2012: Process Safety Assessments and Specialized Environmental Audits. Of its total audits, roughly 10% (27 in total) comprised the former and just over 5% comprised the latter, of these two newly broken out categories.

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The White House Talks Supply Chain: When Supply Risk Becomes a National Security Issue (Part 1)

For someone who has been researching and covering supply chain risk for a decade, it's extremely refreshing to see what once were esoteric topics become mainstream, albeit due to avoidable -- and unavoidable, in certain cases -- tragedies that disrupted global supply chains. But the topic has not just hit center stage from a boardroom perspective. It's now mainstream to the point where President Obama is compelled to take action and develop a National Strategy for Global Supply Chain Security. For those who have not yet read the announcement, it's worth spending more than the minute or two it takes to scan to really reflect on what it represents that the White House is getting involved in the topic. As far as we are aware, it appears to be the first time that a large government has called out supply chain risk and seeks to tackle the challenge head on -- given its importance to national and global security.

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A Simplified P2P Maturity Model: Stage Zero --- You Have to Start Somewhere (Technology/Systems)

Click here for the first post in this series. And if you're looking for a broader primer on purchase-to-pay systems, tips and organizational maturity models, you can download our recent Compass research brief on the subject, A Foundational Look at P2P Technologies, for free today.

Even before you get on the capability/maturity map for purchase-to-pay systems and processes, you have to start somewhere. And for a surprising number of companies (still today) that somewhere is what we call "Stage Zero." Stage Zero is nothing to be ashamed of. Nor does it imply that an organization has done nothing around processes and systems.

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IBM Closes Emptoris Deal: New Chapter/Technology Outlook for Venerable Spend Management Player

Earlier today, IBM announced it had completed its acquisition of Emptoris (for Spend Matters initial coverage of the acquisition announcement, click here, here, and here). Curiously, IBM appears to have closed the deal more quickly than DemandTec, a provider more focused on the supply chain area than strictly procurement, which it announced before its Emptoris news in mid-December.

The time to close a deal of this size, roughly 45 days from initial press release to closure, is among the fastest we've seen in this market over the years, which could be the result of a number of various items (e.g., due diligence thoroughness, strategic value of a rapid Q1 ramp from a commercial perspective, other strategic activities inside IBM which Emptoris may have a role in). Regardless, it's clear the deal is of high importance to IBM in going after a market (i.e., procurement) that from a technology standpoint, it has historically worked tangentially through solution partnerships.

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