Key challenges facing procurement, managing rising costs, rebalancing costs v risk on inbound supply chains, agile procurement and developments with state government procurement, were the hot topics at PASA’s Perth Big Brekkie.
On the back of news about inflation hitting 6.1%, Tony Davey, Director of Procurement Tribe kicked off with a presentation on the key topic itself.
Pivoting Procurement in a new inflationary world – managing down a rising cost base’ providing a sobering, yet resourceful, presentation in front of a sold out Duxton Hotel audience. The local message to evolve from the gathering was inflation would hit 7.4% in Western Australia.
Tony encouraged procurement professionals to focus efforts on identifying spend categories that are material and most at risk of inflation.
“Start by determining those categories that have the greatest impact of business margin and rank based on the extent to which inflationary pressure exists, “ Tony said.
“Speak with your vendors and gather independent views on the quantum of expected increases. Consider your contractual position i.e. did you lock in prices two years ago, does the contract run for another 12 months, or is it due to expire?”
Tony said the cost of capital would be a growing feature in negotiations.
“You can be sure that in the near future, the cost of working capital is going to feature in your negotiations, and as a part of your value delivery calculation,” he said.
“There is going to be a need to balance an operational desire to stock up because of the short supply issues, but at the same time the accountants are going to be more hawkish about tying up cash in stock.”
Procurement and Supply Australasia (PASA) CEO Jonathan Dutton FCIPS highlighted the challenges facing procurement this year.
Rebalancing cost v risk on inbound supply chains, was discussed by Kobus van der Wath CEO of Axis Group International, sponsors for the Big Brekky event.
Andrew Davy, Assistant Director Procurement Practice Improvement, Dept of Finance, WA Government covered the recently launched three-year procurement strategy by the Western Australian Government to build capability of public servants.
The strategy launched in June 2022, aims to create targeted, whole-of-sector capability initiatives to address individual, organisational and sectoral needs.
WA Government spends more than $16 billion each year procuring goods, services and works.
An executive summary of the new WA Procurement Act and procurement rules was provided by Kathryn Abbott, Director Procurement Policy.
The success of fusing the Agile business methodology with procurement featured in a case study by Henriette Kampfer, Procurement Lead, Networks, APA Group.
Henriette spoke on The APA digital metering project 2020, a nine-figure agile procurement project conducted during Covid online, with seven international vendors.
Rounding out the speakers was Chris Webb, who shared a procurement digital transformation case study from CBH in his role as Head of Procurement.
A key message from Chris’ presentation was “digital transformation is not a set and forget project, it is on going.”
In closing, PASA CEO Jonathan said PASA was proud to reconnect WA procurement professionals.
“We’re delighted to reconnect the procurement community after COVID. Some hadn’t been to a procurement event in WA for nearly three years,” he said.
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