Changing conventions

Delivering the next generation of procurement is all about becoming more commercial and less transactional. It’s about inspiring the confidence of stakeholders that suppliers are aligned to your business plan, using data and insights to drive efficient sourcing and better decision making and extending the influence of the commercial function to look to the future to drive innovation from your supply chain.

Historically, however, the conventional approach to procurement has revolved around sourcing. In the past this has been enough to deliver results, particularly when initially reducing or creating a cost base. However, over the past decade the construct of a business has fundamentally changed.

• Today, labour costs are just 12.5% of a company’s revenues.
• Supplier costs consume up to 70%.
• The success of your business now relies heavily your suppliers.

Given that up to 2/3 of your revenues are now being spent with external third-parties, your suppliers now constitute one of the biggest areas of business investment, an area that you neither own, nor control.

How many accidents waiting-to-happen does your supplier base conceal?

Who runs the risk of something going wrong in your supplier base, like the wrong professional advice, deliveries arriving late, illegal workers, or negligence? You do. Who suffers if governance fails? You do. If your suppliers perform poorly? You again. Nothing demonstrates this more clearly than horse meat scandals, uncapped oil-wells or garment factory disasters.

Further, who knows where the untapped opportunities may be in the market?

Who makes large investments in research and innovation? Suppliers do. Who really knows what is taking place in terms of provenance, transparency and risk? Suppliers do. Who has the greatest potential to provide the support that has a real impact on corporate objectives? Suppliers.

Your suppliers hold the cards for both sides of the equation.

Yet, the conventional corporate approach to managing suppliers too often fails to engage on any level other than price, fails to question the buying itself or think about the context around it, and fails to effectively connect suppliers to corporate objectives.

The Proxima approach challenges behaviours, attitudes and the business need, long before any deal is done.

We enable your entire business to look at supplier relationships in more creative ways, focusing on long-term value, not just minimizing costs.

We align your external assets, your suppliers, with your corporate aims, giving you more control.