The Purchaser Issue 5

VIVE LA RE VOLUTION

MEET ENERGY OBSERVER, THE ZERO-EMISSION GLOBAL ODYSSEY

DRIVING INNOVATION FOR A SUSTAINABLE FUTURE

eaders, businesses, individuals; none of us can afford to ignore our sustainable commitments a moment longer. It is, rightly so, the most important topic dominating supply chain and procurement conversations. And for good reason. Only recently did I read the startling fact that as much as two thirds of the average company’s environmental, social and governance footprint lies with its suppliers. And that 80-90% of greenhouse gas emissions for most products occur across a company’s value chain.

There is, in short, a lot of responsibility on our shoulders. But with that responsibility comes the chance to lead, to take the driving seat in the momentous change that is needed, and to innovate and pioneer. In this issue you’ll find many such innovators.

Take Energy Observer as an example. The incredible, self-sufficient vessel is taking its pioneering renewable technologies around the world, showing us all how they may contribute to the future energy system and transform sectors like shipping. Or Grubmarket’s Mike Xu, who is using software to bring sustainable transformation to the food supply chain; there’s Alice too, the silent, all-electric air transport innovator.

Sustainable leadership isn’t just about emissions and climate change, though. It’s about how we interact with the planet on a deeper level. That’s why we felt it important to discuss ethical supply chains and procurement – a subject so important for brands to get right if they are to build close and lasting relationships with their customers. There’s even a question of mitigating risk through the better building of lasting and sustainable partner networks, as Sundar Kamak explains.

Whatever your sustainability challenge, we hope you find this issue both inspiring and informative.

Matt

Content Director Matt High

Creative Directors

Daniel Crawford

Steve Shipley

Marketing Director Jack Pascall

Project Director Manuel Navarro

Project Director Tawfiq Kopti

Managing Director Charlotte Clarke

Managing Director James Pepper

50 44

42 | INNOVATOR EVIATION

Meet Alice. Silent, all electric, affordable and sustainable. It’s the future

44 | PERSPECTIVE OUR DIGITAL FUTURE

There’s a lot at stake when digitally transforming procurement. Here’s how

50 | ENTREPRENEUR MIKE XU

Consolidating the food supply chain with technology

52 | CITY GUIDE

48 HRS: TALLIN

Business and pleasure in the Estonian capital

60 | CALENDAR EVENTS

The best events for 2021

Only those procurement leaders who take bold action can make a decisive difference in tackling global sustainability challenges. Those leaders, says McKinsey in its recent Buying into a more sustainable value chain research, occupy a critical role because up to two-thirds of the average company’s environment, social and governance (ESG) footprint sit with the upstream supply chain. ESG must be built into a company’s sourcing DNA, says McKinsey, a process that can be achieved through actions including determining risk areas and improvement opportunities, and defining ESG metrics to be integrated into supplier selection.

www.mckinsey.com

Nike has lost 10 weeks of production since mid-July as a result of supply chain constraints. CFO Matt Friend elaborated on the challenges the company has faced in a recent corporate earnings call. Friend said it would normally take 40 days to move products from Asia to North America before COVID. However, container shortages, port and rail congestion and labour challenges have increased that timeframe to around 80 days and impacted fiscal revenue growth. “That gap will continue until factories are able to reopen and produce product at normal capacity,” he added.

www.nike.com

87%

of supply chain executives believe that multiparty systems will become the centre of commerce, supply chain and transactions among partners and customers.

Accenture: What are the supply chain’s technology priorities

“BENCHMARKING CAN REVEAL HIDDEN ESG STRENGTHS WITHIN THE VALUE CHAIN, AS WELL AS SHOW COMPANIES WHERE THEY NEED TO IMPROVE TO MATCH OR OUTPERFORM INDUSTRY NORMS”

CREATING RESILIENCE

Sustainability, resilience to supply and operation disruption, and accountability for the social impacts of the business: new and essential supply chain priorities, according to consulting firm Bain & Company. As part of its 2021 Energy and Natural Resources report, Bain finds supply chain goals are no longer merely about price, quality and inventory levels. Today, leaders face a more complex environment with far greater stakes, it adds, explaining that future investment should focus on digitally-driven resilience and flexibility measures such as advanced analytics and big data.

www.bain.com

54%

Corporate spending on diverse suppliers rose to an average of 54% between 2019 and 2020.

Bain & Company: Supplier Diversity: How to Overcome

Four Key Obstacles

AIRBORNE VACCINE

UPS Flight Forward has made the first COVID-19 vaccine drone delivery in the US using autonomous, battery-powered drones that produce zero operational emissions and include a temperature monitoring device to keep delivered vaccines at the correct temperature.

www.about.ups.com

PEOPLE POWER

Only 38% of supply chain executives feel their workforce is mostly or completely ready to use the digital tools they have access to, Accenture has found. It’s a concerning statistic, and one that must be addressed if companies are serious about digital transformation. Technology can enable growth, but only as part of a people-powered transformation, says Accenture. Companies should help their workforce to adapt to new innovations, it explains, by beginning any digital transformation programme with a formal talent strategy, develop new skills at scale using AI and analytics, foster the traditional skills that are still valuable and focus leadership on change management and culture.

www.accenture.com

FORD GOES CIRCULAR

A partnership between Ford Motor Co and sustainability startup Redwood Materials aims to lower the cost of EVs by developing a closed loop or circular supply chain for their batteries, from raw materials to recycling. The initiative will also narrow the environmental impact of the mining and refining of battery materials.

www.reuters.com

NEXT-GEN TRANSPORT

FedEx is trialling the use of autonomous delivery trucks in partnership with autonomous tech innovator Aurora and truck manufacturer Paccar. The pilot, which –for now – is still using a backup driver for additional safety, sees Aurora’s Autonomous Vehicle Platform take the wheel on FedEx parcel routes between Dallas and Houston, an 800km round trip.

www.fedex.com

Costco charters three container ships and ‘several thousand containers’ to protect itself from further supply chain disruption and to mitigate rising costs.

PepsiCo will reduce its use of virgin plastic per serving by 50% across its global food and beverage portfolio by 2030 as part of its new Pep+ initiative.

A.P. Moller- Maersk acquires cloud-based logistics startup Huub in its drive to deliver integrated logistics to customers.

Amazon launches the Agroforestry and Restoration Accelerator in collaboration with The Nature Conservancy to restore native Brazilian rainforests and fight climate change.

UPS announces company-wide ESG targets, including a pledge to be carbon neutral across scope 1, 2 and 3 emissions in its global operations by 2050.

In an effort to accelerate its commitment to a diverse and inclusive supply chain, Intel pledges to double spending with diverse suppliers to $2bn by 2030.

_A QUESTION

SUNDAR KAMAK DISCUSSES

HOW LESSONS LEARNED FROM THE GLOBAL SEMICONDUCTOR SHORTAGE CAN HELP SHAPE AND STRENGTHEN TOMORROW’S SUPPLY CHAINS

QUESTION _ OFRISK

“A SUPPLY CHAIN IS ONLY EVER AS GOOD AS ITS WEAKEST LINK”

Semiconductors. To many, an unseen yet absolutely fundamental part of the fabric of modern life. Small, mineral-based and all pervasive, semiconductors have for the last 18 months been headline news – everywhere we turn, certainly in conversations around disruption, technology, the effectiveness [or not] of supply chains and industries, has been dominated by the shortage of chips that’s been exacerbated by the global COVID pandemic.

But rightly so. You see, semiconductors are everywhere we turn. From smartphones and aircraft to data centres, buildings, wearable tech and everything in between, the tiny chips are symbolic of the way in which our work and personal lives continue to be digitalised. Did you know, for example, that there’s as many as 3,000 semiconductors in one new, modern car?

Or that global sales increased by 6.5% in 2020; a measure of the exponential demand for chips across a host of markets. How many you encounter in one form or another on a daily basis? That’s anyone’s guess.

That’s why the global shortage that has come to the fore during the pandemic has been such a hotly followed topic. By acutely demonstrating the huge demand for semiconductors for every industry and technology, it has been a catalyst for action for industries and companies – see, for example, calls in the US congress for measures to hasten US domestic production (more on why this isn’t a short team fix later). The shortage has also demonstrated the fragility of chip manufacture and supply, where typical lead times are greater than for many other components and technologies. In the context of this

publication, it has made clear the inherent risk in such fragile supply chains and highlighted the need for agility and flexibility as core attributes of risk mitigation.

But first, to recap. In the second quarter of 2020 vehicle manufacturers – one of the larger users of semiconductors today –reduced production and, thus, semiconductor purchases as a result of a slowing market brought on by the global disruption caused by COVID. At the same time, our not so subtle shift to worldwide remote working, an increased reliance on innovative technologies to enable new and remote approaches to healthcare and virtual

learning, saw chip manufacturers face a surge in demand. When vehicle sales rebounded towards the end of 2020 and the industry’s thirst for semiconductors was renewed, chip manufacturers didn’t (and still don’t) have the capacity to meet demand.

There is no short term fix to such a challenge. Semiconductor manufacturing is, by its very nature lengthy and not suited to quick or large shifts in demand. There are, however, valuable lessons to be learned for leaders around building and maintaining more resilient supply chains, better understanding the risk and

pinch points in a network and improving transparency and visibility, says Ivalua’s Sundar Kamak.

“A supply chain is only ever as good as its weakest link,” Kamak begins, reflecting on the extent of the disruption caused by the pandemic. “The supply chain as we know it has been changed; what we’ve seen and the lessons we’ve learned will be a defining moment moving forward. Supply chain 101 is to have contingency plans in place, we all know that. But such is the extent of COVID that we’ve seen

even the best laid plans and contingencies unable to fully address something so very global and drastic in its nature. But the pandemic has also brought people to the fore, too. It’s no longer just about contingencies – people, partners and relationships are even more important now. Most of the problems we’ve seen are just people having no real idea where their products are, who their suppliers are or their ultimates.

“Most contingency plans are based on certain assumptions,” says Kamak. “But there were no supply chain models that

“WHEN A GLOBAL PANDEMIC HAPPENS THAT’S WHEN YOU TRULY UNDERSTAND THE NATURE OF YOUR RELATIONSHIP WITH YOUR SUPPLIERS”

were ready to deal with the many challenges and I don’t think anyone had ever planned for such a scenario. We’re not just talking about lack of supply either, the global nature of the pandemic meant transportation was an issue, as was the procurement of necessary raw materials that can only be sourced from certain locations. It raises a lot of questions about what to do if the world comes to a standstill again – you can’t have unlimited inventory so it’s forcing most to think about creative ways to solve these challenges.”

There will always be weaknesses in a supply chain or specific areas of industry. In the case of semiconductors, COVID was the unfortunate final piece of the puzzle in an already constrained supply chain – impacted over the last years by trade wars between the US and China, and Japan and Korea, as well as disasters in key manufacturing locations. “My cell phone is 50 times faster than some of the older computers,” Kamak states, “and such is the pace of innovation, as well as the processing power that’s needed for that technology, that there’s a lot of stress on the semiconductor industry.

“It’s a capital-intensive sector to be in, too,” he continues. “And that means there’s no short-term fix. You can’t just decide to ramp up a new factory, it’s a billion dollarplus investment. At the same time the skillset and experience required to produce is high; you add all this together and

you’re going to see a crunch. Really, all COVID did was bring to light that it’s a very stressful or strenuous supply chain. On the one hand you have an industry that everyone is investing in and ‘doing’. On the other, there’s a tendency to forget that the silicon and other materials that actually go into the manufacturing are typically only supplied by one or two countries, and that’s not going to change, so you’re always going to have an issue where a growing number of industries are putting pressure on the supply chain and sectors like automotive which, with all its financial backing and investment, really wants to be in the driving seat.”

And yet, the automotive industry – with some exceptions like Toyota as an example – is still reeling from the challenges. It is, says Kamak, a lesson for supply chain leaders everywhere to truly understand your suppliers, inventory and products. “I don’t think they really took a lot of effort to think about semiconductors in general because there’s always been a greater focus on the traditional things that go into cars, like palladium for exhausts as one example. The car manufacturing industry is one of the most complex supply chains, simply due to the sheer number of parts that go into a modern vehicle. Over the years companies have become leaner and moved to modular manufacturing – they’re not really manufacturing – so they’re reliant on their suppliers. That’s where they’ve been caught flat-footed.”

Enter risk forecasting, visibility and relationships: three of the most important lessons learned from being caught out, says Kamak. We have, he believes, weathered the worst of the disruption from COVID and must now reflect. “You’ve got to think beyond your own immediate supply chain now,” he states. “We’ve learned that, even if your supply chain doesn’t have major flaws, you’re affected by someone else’s and beyond; when a global pandemic happens that’s when you truly understand the nature of your relationship with your suppliers.”

Moving forward, says Kamak, such relationships must be built on collaboration and trust, as well as a mindset of how you are able to help your supplier to be more successful so as to create a shared competitive advantage. In turn, he explains, establishing this level of trust will pay dividends when it comes to forecasting and visibility. “You’ve got to bring your suppliers into all collaboration around risk,” he adds. “So many of the conversations I’m having with organisations are around bringing supplier relationships closer together and having better oversight of forecast and demand planning. Lots of companies have realised that a large proportion of such work is still paper based, that there’s not much collaboration, suppliers have no visibility and more.

“Leaders and companies have to be giving full visibility to suppliers, especially when it comes to forecasting. On a practical level that means things like sharing of information both ways rather than in one way only and making the relationship the priority. Take Toyota as a relevant example. It was able to run its plants for another three or four months compared to other OEMs because, for some reason, it had inventory and was able to streamline well. As a business, Toyota has always found a successful way to treat its suppliers that’s based on long-term relationships – I think it’s a cultural change we’ll start to see.”

People aside, Kamak points to technology as essential in risk mitigation. Too often, he says, companies still rely on manual or paper-driven processes whereas digitising can bring a raft of benefits.

“Automating processes is key,” he affirms. “And you’ve got to start somewhere, so pick the pain point. For many, that’s forecasting and visibility, and doing so can ease the burden on your suppliers too. You give a full view of everything in a single place and suddenly you change the game in terms of how you collaborate with those suppliers.”

“Thankfully, there’s a real drive to fix these issues,” continues Kamak.

Change the game you may, but Kamak believes disruption may last for some time yet. Specifically with regards to semiconductors, fixing the supplydemand imbalance isn’t a quick solution – only recently did Intel Chief Executive Pat Gelsinger predict another two years before production can ramp up; Dell Technologies’ Michael Dell painted a similar picture.

“My hope is that we have experienced the worst. There’s still going to be lingering

effects for the next couple of years I think, but you sense we’re beginning to understand how to deal with this,” says Kamak. “Leaders must work with the disruption and continue to build an environment where supply chains become more resilient. And they are resilient if designed correctly, but we’ve seen that even the best laid designs can’t work in every situation. There’s always going to be exceptions, but we hope that the one exception is COVID.”

Sundar Kamak leads Ivalua’s Industry Solutions Business, with a focus on direct materials procurement and supply chain solutions. He has some 20 years’+ experience in areas including traditional supply chain, source-to-pay, technology, manufacturing, aerospace and automotive.

www.ivalua.com

“THE CAR MANUFACTURING INDUSTRY IS ONE OF THE MOST COMPLEX SUPPLY CHAINS, SIMPLY DUE TO THE SHEER NUMBER OF PARTS THAT GO INTO A MODERN VEHICLE”

Portfolio

i nnovative and ins P ired items for work, leisure and the environmentally conscious

ROGER DUBUIS EXCALIBUR SPIDER PIRELLI

It is, if we’re honest, a niche wishlist to contain ‘watch made from the tyres of cars that have won races’. But that hasn’t stopped Swiss watch artisans Roger Dubuis and Pirelli. The result of this partnership is the Excalibur Spider Pirelli, which sees Dubuis’ signature skeleton calibre – made and certified against the strictest horology certifications – wrapped in black DLC titanium. The watch includes exclusive straps made of ‘winning motorsport tyre rubber’, courtesy of Pirelli, which also feature Pirelli-specific tread patterns on the inside surface.

www.rogerdubuis.com

Portfolio

i nnovative and ins P ired items for work, leisure and the environmentally conscious

SUPERSTRATA E

You can 3D print anything nowadays: food, houses, dinosaurs… Add to the list the incredible Superstrata E, a unibody thermoplastic carbon fiber e-bicycle that’s custom-fit to its riders proportions [whether you’re ‘dainty or lanky’, according to its makers]. Unibody construction from single, continuous carbon fiber makes the Superstrata E light – around 11kg – easy to conceal a slim battery that can help you reach speeds of up to 20 mph, and ridiculously strong. So strong, claims Superstrata, that it’s a bike fit for space. All you have to do is get it there.

www.superstrata.bike

Portfolio

i nnovative and ins P ired items for work, leisure and the environmentally conscious

DIZZ CONCEPT OFFICE SHELL

Offices have always been tricky environments when you want a little privacy or isolation. And, in the high-tech world we live in, you’d like to think that we’ve progressed beyond the clunky, fabric acoustic barriers of yesteryear. Office Shell is one solution. The compact, customisable work pod that comes courtesy of award-winning interior design house Dizz Concept enables unobstructed working in open plan spaces, allows for individual adjustment of lighting and colour intensity to suit its user and is made of natural materials. It even has smartglass windows, for when you really want to get out of that meeting.

www.dizzconcept.com

Portfolio

i nnovative and ins P ired items for work, leisure and the environmentally conscious

PROJECT HAZEL

The world’s smartest mask. Says tech lifestyle brand Razer of its Project Hazel smart mask and, looking at the high-tech face covering, it’s hard to disagree. Project Hazel’s intelligent design incorporates innovative technology and safety features. Take, for example, its active ventilation system that filters at least 95% of airborne particles, or the special charging case with a UV interior that kills bacteria and sterilises between uses. Other features include lowlight mode that sees the mask light up at night and a built-in mic and amplifier to avoid any tricky ‘mask voice’ mumbling.

Portfolio

i nnovative and ins P ired items for work, leisure and the environmentally conscious

SPIRIT ANIMAL

Spirit Animal is committed to sustainability, respect and responsibility. It is, it says, a different breed of coffee designed to change your palate and the planet. All beans are sourced from independent farmers in Honduras, fair wages are paid to all involved in the supply chain and the company reinvests its own profits back into its farms. Those farms are located at around 5,000ft, giving a sweeter taste from the top 1% of all beans chosen by Spirit Animal. The result: impeccable environmental standards and award-winning coffee ranked outstanding by the Speciality Coffee Association.

www.spiritanimalcoffee.com

ener Gy o B server

BUILDING THE ODYSSEY

The first hydrogen-powered and zero-emission vessel to be self-sufficient in energy; a laboratory for ecological transition; a global movement for the most important of causes. Energy Observer is many things, all of them focused on creating a better future driven by innovative technologies and new ways of travel.

The Energy Observer project was conceived in 2013 by master mariner Victorien Erussard with a singular and crucial mission: to explore and develop solutions that prove that another future for energy is possible, one that is both innovative and optimistic, and more respectful of our planet. It would do so by creating a vessel that only draws its energy from nature and circumnavigating the globe to learn, share, innovate and develop.

And at this moment in time there are few more important missions. Take, for example, the fact that global shipping accounts for more than 80% of world trade. Or that, according to the World Economic Forum, the annual greenhouse gas emissions from seaborne world trade is more than one billion tons. To put that more simply, if international shipping were treated as a country, it would be the sixth largest emitter of CO2 in the world, after the US, China, Russia, India and Japan.

Onboard with Bertrand Piccard and H.S.H Prince Albert II of Monaco

“HER ON-BOARD TECHNOLOGIES, COMBINING MULTIPLE SOURCES – SOLAR, WIND AND HYDRO POWER – AND FORMS OF STORAGE, BATTERIES AND ABOVE ALL HYDROGEN PREFIGURE TOMORROW’S INTELLIGENT ENERGY NETWORKS”

With Emmanuel Macron in 2018

It is against this alarming set of statistics that the eponymous vessel exists, entirely self-sufficient in energy, using multiple on-board technologies including solar, wind and hydro power, battery storage and hydrogen as fuel. Her team of engineers, researchers and scientists are dedicated to testing these technologies so as to make renewable energies a reality for us all. Using such a broad scope of renewable energies is essential for the building of future resilient zero-carbon energy systems, they explain.

Hydrogen plays a crucial role, enabling excess surplus energies to be stored and their irregularity to be offset. The 63kg of hydrogen currently stored on board Energy Observer provides 1MWh of electricity, which is the equivalent to the average electricity consumption (including electric heating) of a four person household for one month and 10 days. Other innovations trialled on board include the first bi-facial heterojunction solar panels, as well as flexible and vertical panels, and wind energy technologies such as traction kite systems and vertical-axis wind turbines.

As a result of this pioneering work, she can cruise the oceans with zero emissions, zero fine particles and zero noise. And that’s what she has done, travelling the world to both demonstrate and test the innovative new technologies and bring the Energy Observer message to people worldwide. To date Energy Observer has travelled some 40,000 nautical miles. All emissions free.

www.energy-observer.org

Lighting up the Eiffel Tower with green hydrogen

“WE DESIGNED HER TO PROVE THAT ENTIRELY DECARBONISED, DECENTRALISED AND DIGITISED ENERGY IS POSSIBLE, THAT SUCH A VIRTUOUS CIRCLE IS ACHIEVABLE.”

THE AGE OF SUPPLY

THE DAYS WHEN SUPPLY CHAIN LEADERS COULD CONCENTRATE ON COST, EFFICIENCY AND TIMELINESS FROM SUPPLIERS ARE GONE, SAYS MARK MORLEY. NOW ETHICAL AND SUSTAINABLE SUPPLY CHAINS ARE PARAMOUNT

THE ETHICAL CHAIN

Prior to the COVID-19 pandemic, consumer desire to prioritise doing business with organisations that have clear ethical sourcing and purchasing policies in place was riding high. In the United Kingdom, ethical consumer spending reached a record £98bn in 2019, according to a UK Ethical Consumer Markets Report . But then came COVID. And, as lockdowns hit, options were reduced and pragmatic decisions had to be made. Consumers had little choice but to retreat from their ethical values in favour of convenience and availability.

At the same time, though, lockdown retail (quite literally) brought home the reality of shopping’s impact, with consumers becoming significantly more aware of their waste, carbon, and social footprint. But, as we begin to consider our transition into 2022 and thoughts turn to the post pandemic world, it’s important to understand what supply chain leaders and their businesses learn from these events in order to stay ahead of the ethical shopping trend.

THE RISE OF ETHICAL PURCHASING

The drive towards ethical purchasing has seen a rapid increase. In fact, here at OpenText, we recently conducted global research with 27,000 consumers and found that a fifth of those who favour

buying ethical products have only started doing so since April 2020. In addition, it was revealed that more than two in five would pay significantly more for ethical goods, with 84% also willing to compromise convenience in order to shop ethically.

However, our research also confirmed that COVID lockdowns meant consumers were constrained in their shopping habits. For example, 48% said they ‘couldn’t prioritise ethical purchasing’. This led to a real global dip in how many people were able to follow their ethical principles while shopping (-10%).

More deliveries of goods ordered online also meant that a greater number of consumers became aware of their waste impact during the pandemic (61%) – you will, I’m sure, have experienced exactly the same on your own front doorstep, with the number of deliveries and therefore, cardboard boxes, literally piling up. While the shift to online shopping had already been underway for the previous couple of decades, the pandemic served as a catalyst in the acceleration of the trend, resulting in three in five saying that COVID has made them more mindful of the environmental and social impact of where they buy from.

that 60% of customers would spend up to 5% more on clothing if they had a guarantee that garment workers were paid a fair living wage.

Regardless of the specific priority, once retailers, businesses and brands understand what kinds of ethical drivers influence their audiences and their buying decisions, they have to be transparent and proactive about meeting those needs.

THE BUSINESS OPPORTUNITY

What businesses do now can generate a competitive advantage in their markets.

UNDERSTANDING CUSTOMER PRIORITIES

However, consumers have varying motivations about what kind of ethical practices they value most. Even on a simple demographic like age, we found significant differences in motivation and outlook.

Younger shoppers are more likely to focus on their carbon footprint by aiming to shop locally where possible, while older shoppers are particularly concerned by working conditions in product manufacturing, saying that they would stop shopping at a brand which was found to be using child or slave labour. Other research also found

Looking ahead, our research shows that ethical purchasing won’t just rebound from its lockdown-related contraction, it will accelerate significantly, becoming a central value for many.

According to HSBC’s Made for the Future Report, 96% of businesses said that they are feeling increasing pressure to become more sustainable, and 86% expect their sales to grow over the next year through a greater focus on sustainability. Our research discovered that two in five consumers are also willing to pay a premium of more than 25% for something they

“THE DRIVE TOWARDS ETHICAL PURCHASING HAS SEEN A RAPID INCREASE”

consider an ethically sourced product – music to the ears of those trying to show ROI for investment in ethical supply chain initiatives.

Regardless of their motivations, consumers largely don’t see this as a matter of just personal responsibility: globally, 85% say that online retailers should ‘clearly mark whether or not products are ethicallysourced’ and 69% agree that ‘governments should introduce legislation that holds businesses accountable for responsible sourcing’. This sentiment is supported by Edelman’s Trust Barometer 2020, which found that 81% of consumers expect brands to do the right thing.

EMPOWERING THE ETHICAL SUPPLY CHAIN

As the economy rebounds from the impact of the pandemic, ethical shopping won’t just recover, it will surpass previous highs to become a central concern for many more shoppers. It’s for this reason that now is the moment for brands to drive progress on their ethical sourcing to stay ahead of the curve.

If business leaders and supply chain executives don’t pay attention to this trend, they face two key threats. First, they risk losing customers who seek ethical and sustainable products. In the world of social media, a company that falls short of expectations is quickly reported, which can cause significant reputational and brand damage. Second, they risk weakened relationships with partners who seek to

improve their ethical standards, and other key stakeholders, including investors, governments and regulators.

With that in mind, it’s clear that the days when supply chain leaders could concentrate on simply driving cost, efficiency and timeliness from their suppliers are gone. To fully embrace that change, there are two practical steps that brands can take right now:

• Review their own customer base and their ethical priorities. For example,

running a social media poll or customer survey to explore what they value from you most.

• Delivering an ethical supply chain requires extremely high levels of transparency and end-to-end visibility into an organisation’s operations and that of its suppliers and their suppliers. Investing in the right technology to support this is essential.

Ultimately, an organisation that can demonstrate its supply chain operations are

complying with the highest standards is likely to make it a more attractive option for customers, prospects, partners and investors, fuelling future business growth. Only by investing in an end-to-end digital supply chain can an ethical supply chain be properly designed and delivered to achieve a stronger competitive advantage in the market.

Mark Morley is a strategic B2B marketing professional with more than 25 years’ experience working for global blue chip IT companies. As Senior Director, Product Marketing for Business Network at OpenText, he leads the team looking after the company’s business network solutions portfolio.

“ONLY BY INVESTING IN AN END-TOEND DIGITAL SUPPLY CHAIN CAN AN ETHICAL SUPPLY CHAIN BE PROPERLY DESIGNED AND DELIVERED”

Meet Alice. Silent, all electric, affordable and sustainable; she is the future. Certainly according to DHL Express, which is the first to order 12 of the fully electric eCargo aircraft to build its own zero-emission fleet.

Alice is the brainchild of Eviation, a team of engineers, innovators and creators dedicated to permanently changing the way we move. Sustainable aviation is the way to do this, says the company, explaining that the skies are a resource

we must use more, but that we should do so with respect.

Innovative technology is key to this, in particular Alice’s magniX all-electric propulsion system — a solution that’s already been flight tested and proven. It allows Alice to carry 1,200 kgs over a maximum range of 815 km, operate in all environments and charge in 30 minutes or less per flight hour.

www.eviation.co

09 PASSENGERS

32,000FT MAX CRUISE ALTITUDE

10,000FT

TYPICAL CRUISE ALTITUDE

OUR DIGITAL FUTURE -

There’s a lot at stake in any digital transformation, particularly for the pro–curement function. Here, Keith Hausmann shares insight on driving an effective digital strategy

The events of the last 18 months have made procurement leaders across the globe more aware than ever of the importance of digital transformation to ensure that their business remains competitive. But it’s no easy task. Indeed, there are many critical factors to ensure that any digital transformation is a success and that the intended benefits are realised.

But transformation also brings opportunity. And when such a chance presents itself, there are several things that the procurement function must consider. For example, what new capabilities must procurement have to enable the company to achieve its strategic priorities in an increasingly unpredictable and fast-changing world? And what best practices can it adopt from other companies that have already successfully started a similar procurement transformation?

I spend a significant amount of time speaking with enterprise procurement leaders during executive roundtables and advisory boards. In the context of the above, here I’ll outline the top five areas they have shared as being critical to a successful procurement digital transformation strategy.

1. BUSINESS BEFORE PROCUREMENT

Traditional, analogue procurement processes and models were typically built around what the procurement function itself needed to achieve, rather than what those in the wider business might have found helpful or easy to use.

It’s a mindset that has to change if procurement is to make the most of digital by prioritising key business needs such as injecting agility into the buying process, improving speed to market, generating greater value from higher-quality suppliers and bringing impact to a company’s ESG agenda through instant access to a global network of sustainable and diverse suppliers.

By adopting platforms that focus on what the users want, and that offer a simple, intuitive, consumer-like experience, procurement can encourage greater user compliance and, ultimately, play a bigger role in driving growth across the business as a whole.

2. A SELF-SERVICE APPROACH

Business stakeholders have been successfully using a self-service approach in their personal lives for many years. It’s time procurement caught up.

While procurement teams may have concerns about losing visibility and control

if business partners do their own supplier sourcing, the AI-powered self-service solutions available today mean this caution is unfounded.

There’s no downside to this self-serve approach. However, companies must ensure the technology platforms they implement have a framework in place that includes a transparent, competitive and inclusive buying process as the norm.

Providing stakeholders with all the advice and guidance they need at their fingertips,

these innovative digital technologies and platforms, used as part of a best-of-breed ecosystem, will allow procurement professionals to focus more on the strategic tasks and projects that will add real value and make a difference to their business.

3. 24/7 PLATFORMS AND PROCESSES

We know from our own experience that not everyone works the same hours, and that many people want to be able to work where and when is best for them. Procurement can therefore no longer restrict its services to traditional service hours.

on learning, development and wellness programmes, as well as recruitment, while marketing services continue to enjoy high demand across both digital and traditional media and facilities teams undertake projects relating to new workplaces, office rationalisation and COVID safety protocols.

4. AGILITY THROUGH PROCUREMENT

Today’s business environment is in a state of constant flux, with new opportunities and challenges arising on a daily basis. To remain on top of this constantly shifting lifting landscape, an organisation’s

For the required level of flexibility, all platforms and processes need to be digital, automated and always on. Postpandemic, we’ve seen a growing interest and demand by companies to move to self-service platforms that enable business users to dynamically source services from any location.

Although the specific use cases have changed as companies pivot to new remote and hybrid operating models, demand for services remains high. We’re seeing increases in HR spending

procurement function must be able to deliver agility – essential to allowing companies to make quick decisions, take immediate actions, and change direction when necessary.

Harnessing the power of digital technology is essential to enabling this flexibility. For example, when requesting the names of suppliers their procurement function recommends, a company’s stakeholders should be able to immediately access a list

“All platforms and processes need to be digital, automated and always on”

through a self-service platform rather than having to wait for it to be drawn up – or worse – having to wade through mountains of spreadsheets to compile it themselves.

5. ENCOURAGE DIVERSITY AND INCLUSION

By giving businesses the ability to source goods and services in a fair, transparent and competitive way, digitalisation has created significant new opportunities to increase diversity and inclusion among their suppliers.

In the past, organisations looking to avoid a slow and laborious RFP process would tend to go back time and time again to the same few suppliers they’d always worked with. Now, speeding up the procurement process has encouraged business stakeholders to consider a broader field of qualified potential suppliers of all sizes from all locations, resulting in more diverse and innovative options.

DIGITALISE TO DRIVE COMPETITIVE ADVANTAGE

The impact of the pandemic has taught us all the importance of being able to make fast, informed business decisions in an increasingly uncertain world. Indeed, it has accelerated the digital transformation of organisations everywhere looking to improve the efficiency, flexibility, and agility of their operating models. The procurement function should be no exception.

“Success in today’s fast-changing world requires procurement leaders to embrace digital technology”

Success in today’s fast-changing world requires procurement leaders to embrace digital technology and, by delivering an intuitive, easy-to-use experience to stakeholders on their terms, use it as a competitive advantage. With these five pillars in place, the procurement function will be on the right track to unlocking the advantages of digitalisation, moving from a primary focus on supply and cost savings toward a broader position, adding strategic value and driving long-term growth.

Keith Hausmann is

Chief Revenue Officer

at Globality, responsible for bringing transformative innovation through AI to the purchaser and sale of B2B services and creating a new ecosystem for global trade.

“An organisation’s procure–ment function must be able to deliver agility”

“WE ARE TRYING TO CONSOLIDATE THE AMERICAN FOOD SUPPLY CHAIN THROUGH SOFTWARE TECHNOLOGIES”

Entrepreneur

Xu

“We are still the first mover in this space,” says Mike Xu, “no one else is doing consolidation on the supply chain side as we are.” Xu, an established and respected software executive who has previously built and led engineering teams at several leading Silicon Valley organisations is discussing GrubMarket, the tech-driven food business he founded six years ago.

GrubMarket is America’s largest and fastest growing food supply chain ecommerce company. It exists, says Xu, to disrupt and digitally transform the nation’s food supply chain industry that has been ‘left behind from technology for many generations’.

Given Xu’s passion for innovation, technology and building products – he has filed two patents as primary or sole inventor and built and delivered cutting-edge tech projects across several industries – it should be no surprise that GrubMarket’s success is firmly entrenched in innovative software that, in this case, helps improve and consolidate the network between food suppliers and their customers.”

www.grubmarket.com

Mike

GRUBMARKET MIKE XU

T A L L I N

WORDS VILVE VENE

Sitting on the northern coast of Estonia and looking out on the Baltic Sea, Tallinn is an exciting, dynamic city. New startups and entrepreneurs are emerging and flourishing here all the time – it’s not surprising that TechRound named it the “Silicon Valley of Europe”. Being one of Europe’s biggest startup hubs, Tallinn is a very inspirational place to be, hearing about the success of so many businesses gives you the feeling that nothing is impossible.

For a capital city Tallinn is small, but this gives it a deep sense of community and everything is located conveniently close, anything you want is just a walk or bike-ride away. There’s no need for a car to get around, especially as public transport is free for residents.

In your spare time, you can take a walk around Tallinn’s medieval Old Town, which dates to the 13th century, or through one of the city’s many parks. It is a beautiful place to visit, whether for work or pleasure.

BUSINESS

My company, Modularbank, has been based in a wonderful co-working space called Workland for the past year. It’s conveniently located in the Old Town, and has all the amenities one might need. You can meet someone here for a coffee, or book a private room for a meeting or just to work in silence. It’s a beautiful place to network and do business, either for a few hours or for an extended period.

Located in the heart of Telliskivi, one of the hippest areas in Tallinn, LIFT99 is a great startup hub. There are several entrepreneurs located here, and the owners organise lots of different events and networking opportunities. LIFT99’s mission

is to strengthen the global startup community and help it succeed by bringing founders together. It’s definitely a very energetic place to be in.

Another great thing about Tallinn is that you can work from anywhere in town, especially as there is free wifi available everywhere. This shouldn’t come as a surprise as, after all, Estonia is probably the only country in the world where 99% of the public services are available online 24/7.

Another of my favourite places to work from is the scandi-influenced bakery and coffee shop RØST; it opens early and sells some of the best pastries I’ve ever eaten!

Honestly, I suggest just booking an Airbnb. There are many great apartments throughout the city to rent at a moderate cost, including some overlooking the sea.

If you are looking for something a little fancier, however, there is the 5-star Telegraaf Hotel. It is a lovely building in the Old Town with a spa, great services, and the upscale Restaurant Tchaikovsky. It also has a wonderful garden to be enjoyed, especially in the summer.

RESTAURANT TELEGRAAF

Vilve Vene is the CEO and Co-founder of Modularbank, a next-generation core banking technology provider. She is a financial IT pioneer and visionary from Estonia, having begun developing innovative financial technologies well before fintech even became a tangible concept. For the past 30 years, she has been digitalising large Nordic banks and establishing leading financial technology companies. She is one of the bright minds behind the Estonian e-tax system and was recognised as a “Highly Commended” Woman in Tech at the Banking Tech Awards 2020.

VILVE VENE

TELEGRAAF HOTEL SPA

EAT / DRINK

Tallinn’s food and drink scene is booming right now, with new places opening all the time.

Karase Sai is a great bakery and a wonderful place for breakfast. Recently, the owner has expanded his business to also offer a dining option in the evening by opening Barbarea , one of my favourite restaurants. It serves a mix of Middle Eastern and Sicilian food – lots of sharing platters and pizza. Kerase Sai and Barbarea are located about 20 minutes away from the city centre in a subdistrict

called Kopli, which used to be very industrial but is now a great place to walk around.

My favourite place in the Old Town, on Vene Street, is La Bottega . It serves Italian food and has one of the best chefs in Estonia – I recommend the truffle pasta. SALT is another top restaurant.

If you want a drink, my favourite wine bar is Vixen , which is based in a cellar in the Old Town. I often go there after dinner just for a glass of champagne.

KARJASE SAI BARBAREA

LA BOTTEGA SALT VIXEN

LEISURE

There are several theatres in Tallinn, including the Estonian National Opera . If you have time, it is worth spending an evening there.

Telliskivi is the liveliest part of Tallinn, with lots of art, music, food and drink. There you will find, for example, Fotografiska, a renowned photography museum with exhibition spaces in Stockholm and New York. It has lots of exhibits, as well as a very nice rooftop bar and restaurant, plus a wine terrace in the summer.

There is also Uus Laine which recently opened and is vastly different. Built in an old garage, it is quite cosy with great décor; you can go there to listen to music or catch a film.

If you want to spend time outside, Kadriorg Park is beautiful. Peter the Great built it in 1718 for Catherine I. In the park you’ll find the KUMU Art Museum , which is a must see if you have time.

ESTONIAN NATIONAL OPERA FOTOGRAFISKA

TELLISKIVI UUS LAINE KUMU ART MUSEUM

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SCTECH

04-07 OCTOBER

Central Europe – Virtual Event

A global event connecting supply chain professionals and practitioners with leading technology decision makers.

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WORLD PROCUREMENT CONGRESS

13-14 OCTOBER

Virtual Event

A virtual meeting place for CPOs, digital leaders and supply chain professionals to discuss the future of procurement.

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PROCURECON CPO CONNECT

16-17 NOVEMBER 2021

Virtual Event

CPOs and heads of procurement at the world’s biggest companies meet over two interactive days for a productive learning and networking experience.

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ASIA PACIFIC PROCUREMENT CONGRESS

17-18 NOVEMBER

Virtual Event

An opportunity to challenge your thinking on how to cultivate leadership for sustainable, resilient growth.

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ENERGY, SUPPLY CHAIN & PROCUREMENT SUMMIT

08-09 NOVEMBER

Houston, Texas, USA

Where energy supply chain and procurement leaders can explore turbulent market dynamics and new technologies.

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