How Automated Supplier Management Helps Europe Meet New Sustainability Rules
- Public Sector
- Supplier Management
The European Union (EU) has shown a strong interest in promoting green public procurement and sustainability among its member states. This interest culminated in legislation that took effect in April, influencing both the public and private sectors.
As of April 18, the EU is subject to new directives for public procurement. The old regulations sought to make public procurement transparent and open to all EU companies that offer services and products throughout the European Union.
The new law requires member states to ensure that contracting authorities may take into account the need to ensure quality, continuity, accessibility, affordability, availability, and comprehensiveness of the services, the specific needs of different categories of users, including disadvantaged and vulnerable groups, (and) the involvement and empowerment of users and innovation. It also requires the member states to choose service providers based on the best price-quality ratio, taking into account quality and sustainability criteria for social services.
As a result, organizations and enterprises in both the public and private sector will be encouraged to incorporate green and sustainability initiatives as part of their business strategy. Bidders and suppliers will naturally strive to align with the new regulations.
Many organizations have already made sustainability the key pillar in their supplier management strategy. These organizations strive to work only with suppliers whose business activities fully comply with their sustainability principles and code of conduct.
How do they do this?
It starts with robust supplier management and greater visibility into suppliers’ data and relationships. Best practice supplier management involves many internal workflows and approvals. Accomplishing all this in an efficient way is virtually impossible without automating the process and workflows.
When you automate your entire supplier relationship and lifecycle management, you instantly free up staff time for more strategic functions. Instead of chasing down suppliers to complete registration profiles or update certificates, those employees can focus on gaining in-depth visibility into supplier data, capabilities and compliance to business requirements.
Here are a few things you should keep in mind in order to make your automated supplier management help you in your sustainability initiatives:
Make certain new suppliers meet your needs
Even for the simplest sourcing event, you need due diligence to guarantee current or potential suppliers have the qualifications and resources to meet your specific business needs and expectations. An automated supplier management solution will do that for you. Supplier management will help you understand who your strategic suppliers are and how they stack up in terms of quality and risk – all critical to getting the value you expect from sourcing and procurement.
Cull non-compliant suppliers from your system
You need to have complete control and flexibility to establish a formal registration process for your suppliers. Your process should incorporate up-front verification of regulatory and business processes and compliance. Supplier management delivers a formalized supplier vetting process via a highly configurable survey and questionnaire creation functionality. This facilitates the evaluation of potential and existing suppliers on various criteria while collecting documentation and certifications.
Track, monitor and manage to ensure you remain compliant
Make sure you track compliance with second-tier spending guidelines within your automated supplier management tool. Tracking and reporting on second-tier spending goals ensures you are doing business with suppliers who meet and continually comply with your sustainability principles and business requirements.
Learn how JAGGAER solutions empower you to promote green products and manage relationships with sustainable suppliers.