Friday 11 October 2013

If the Earth was a supplier

I'm not sure what set my filters to notice, but there seems to have been a lot of discussions on sustainability recently. I'm sure there always is - it's just been a main topic of many of the conferences I've followed vicariously via livestream and on twitter in the last month: IoD, one young world, CIPS, CIPS awards, climate justice and a meeting I attended facilitated by the unreasonable learners inspired by The B team.

As I reflected on the Landscaping Your Life process, where I use the wisdom of nature to identify solutions to life's challenges, and the profession in which I apply it most, procurement, I wondered about our relationship with the Earth and its sustainability. 

Due to our dependence on the goods and services supplied by Earth shouldn't we be wanting to develop a relationship with the earth. Wouldn't it be in our best interest to ensure the long term flourishing of the Earth for our future needs? 

Since we're continuing to deplete the finite resources of the Earth at ever increasing knots it would seem we haven't quite got our relationship right with the Earth. Which had me wondering what insights and changes in behaviour might emerge if the Earth was classified as a supplier in the supply chain. 

The answer is this blog.

I've used David Atkinson's 10 guiding principles to Supplier Relationship Management (SRM) (shown in italics below) as a basis for this exploration. 

As I've undertaken the exploration it's become clear that some of the principles still don't necessarily safe guard the long term sustainability of Earth due to the objectives of the organisation taking precedence over the long term sustainability of their suppliers.

Two reasons for this jump out at me (although I'm sure there are others):
  • The unconscious implication in best practice procurement that we'll always be able to find alternate sources of supply. 
  • That an organisation's own desire to survive will always take precedence over another organisation's survival.
That said I share here observations that arise if we were wanting to build a relationship with the Earth as a preferred key long term permanent supplier of an organisation with a SRM programme:
  1. SRM is the systematic creation and capture of post-contract value from key business relationships. For most organisations the Earth is one of their subcontractors. So long as they're getting value they're not worried about the implications in the supply chain of obtaining that value. Cost and value analyses are certainly unlikely to include a cost for depleting finite resource in a way they do for replenishable resources such as trees. 
  2. It is about aligning the whole enterprise around the task of managing a specific supplier based on a clearly documented relationship strategy. Sustainability policies, what ever they're called, aren't relationship strategies. They generally state what the organisation is able to do to support the Earth, not what it needs to do in order to maintain a long term relationship with them*
  3. It is mostly about collaboration with strategic suppliers, but can still be adversarial. Do we even understand what collaboration with the Earth really looks like. I'd suggest a majority of the time we're treating the earth adversarially. Does the strategy really suggest that's the best course of action with them? 
  4. SRM needs to be completely integrated with strategic sourcing / category management processes. I'm unconvinced that every category strategy would suggest reliance on the Earth was a good thing. Earth, however, is a default supplier. Taken as a given in every sourcing strategy. If we were to apply best practice to this supplier shouldn't we be spending a majority of our time trying to find alternatives? (Although I suspect that's where self interest gets in the way - turkeys after all don't vote for Thanksgiving nor Christmas) 
  5. It requires a detailed analysis of the specific supplier relationship, before the strategy can be determined; one size certainly does not fit all. As the Earth isn't considered to be a supplier then how much of the analysis even gets done? I wonder what the finance guys would say if someone sent the balance sheet and profit loss account for the Earth to them for assessment. 
  6. SRM is not a soft option in dealing with suppliers. It’s demanding and process-focused. Yet we've ignored the need to do it for our most important supplier. We've not undertaken any planning, no risk assessment, no analysis of power, no strategy B (or as The B team would suggest no Plan B). Instead we've ignored the need for an effective relationship with the Earth and hoped they'd continue to flourish!
  7. It requires recognition that ‘relationships’ are not an end in themselves. Successful relationships are an outcome and, for the buyer, that outcome can be measured in value terms. Perhaps something organisations have concentrated too much on - basing their actions on the value they've achieved rather than considering the impact of their actions. Whether value comes from cost out, price down, risk mitigated or revenue increased it's not sustainable once the resource you're relying on becomes scarce. 
  8. SRM is not all about ‘win-win’; although contracts must be structured to ensure each party enthusiastically implements the agreement. Perhaps it does have to be win/win with the Earth. There's still a propensity to take from the Earth rather than understand that an agreement between two parties requires 'consideration', and therefore we can't just take what we want without something being given in return. What payment are we giving for all this taking? Even in the most exploitative buyer/supplier relationships the supplier gets paid! 
  9. It is as much about driving-up day-to-day operational performance as innovation and joint value creation. I think we're overly focusing on day-to-day performance and even allowing our inefficiencies to increase what we're taking from the Earth. We need to be spending more time on innovation and joint value creation in order for us to flourish alongside the Earth. After all we won't last long without them. 
  10. To get started, it always best to successfully implement a small number of SRM pilot projects, rather than go for the ‘big bang’. Pilot projects need to look at different aspects of your relationship with the Earth dependant on your usage of finite resources, usage of replenishable resources, pollution of the environment, impact of disposal of your goods and so on.  
What will you do differently today in your relationship with the Earth and please don't ignore the one thing you know the Earth would be screaming about if only they had a voice.

Alison Smith
Inspiring change inside and out
* We often refer to organisations as 'they' or 'them' and not 'it'. When writing about the Earth I started to use 'she' rather than 'it' but realise perhaps that's the problem. We don't treat the earth like a supplier because we treat them like an inanimate object, or personify them, rather than an Eco system made up of many more interconnected components than any organisation. As I wrote the blog I chose therefore to treat the Earth as an organisation and therefore use 'they/them' throughout to recognise these many component parts. 

This also links to an earlier blog I wrote on use of empathy when all else fails to get more right doing. In this context empathy is certainly easier when aimed at 'they/them' than 'it' don't you think? 

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