5 steps to managing supplier risk and compliance
Understanding risk and compliance across your supply chain is now essential for any business. By successfully measuring and understanding supplier compliance can ensure that risks are identified, managed and mitigated.
Below, Greenstone outlines five key steps to help you shape your supplier due diligence process to ensure that you are managing your suppliers effectively.
1. Define what information you need to collect
It is important to establish the data you need to collect, and why. A good start is to ask questions such as: What supplier information is material to your organisation? Do different supplier groups or categories have different compliance requirements? Do the reporting frameworks you use dictate the information required?
2. Engage your organisationIn order to be successful you need internal engagement at all levels. All relevant parts of the business need to understand their role in supporting the supplier management programme from initial contact through to supplier development.
3. Prioritise your suppliers
You probably won’t be able to engage all of your suppliers at once. Prioritise and segment your supplier list into groups using factors such as risk, spend, legislation or performance level.
4. Identify the solution that best suits your needs
Online solutions provide the best way to achieve high levels of coverage and compliance, giving you the analytical tools you need to identify risk efficiently. They all vary so finding the right one to suit your needs is important.
5. Define processes for dealing with supplier responses
The most important point from both a buyer and supplier perspective is to use the data collected. There should be assigned responsibility within the business for dealing with any non-compliance in specific areas, and there may be a need for a minimum overall standard for suppliers to meet.
Greenstone enables you to engage your suppliers through its award-winning supply chain sustainability software and support services. SupplierPortal is a supply chain management software solution providing your business with transparency and compliance across your entire supplier network.