Blog • 04.11.21

Top 5 Tips for Supply Chain Best Practice

For many organisations, contractors are an essential part of the business, their specialised skills play a vital role from strategic projects to day-to-day maintenance. Our benchmarking contractor management research identified that 47% of organisations expected to increase or significantly increase their use of contractors in the coming two years.

Contractors are often engaged in physical or high-risk jobs, in unfamiliar surroundings. Independent Analyst Group, Verdantix, recently stated that recordable safety incident rates are typically three times higher for contractors compared with permanent staff. Therefore, consistently monitoring contractor and supplier risk factors is the key to protecting your operations, which is a continual process that should be carefully monitored for potential risk indicators.

At Alcumus we work with nearly half of the FTSE 100 so we know what we’re talking about when it comes to EHSQ risk. We’ve put together a guide outlining the Common Challenges in Contractor Management (and how to solve them) to help organisations like you. In this blog, we outline our Top 5 Tips for Supply Chain Best Practice.

Pre-Qualify contractors and suppliers

If you don’t pre-qualify the contractors and suppliers you work with, either on your own or through a third party, you’re potentially risking yourself to legal and financial implications. You should ideally assess safety statistics, regulatory compliance, past performance, and reputation as well as any necessary insurance and training requirements, so you have peace of mind that they’re a good fit for the job.

Adopt a technology-led approach

By adopting a technology-led approach and access to your data in one place, your entire organisation will have greater visibility when it comes to your supply chain. Managing suppliers is often complex and time-consuming. By investing in a contractor or supply chain management system, you’ll have the right support and an effective management process in place. Create a list of your management system needs, then narrow your system options down to a few good choices that meet your criteria.

Monitor, review and manage issues

By monitoring and reviewing performance throughout the contract period means you can safeguard compliance from your contractor or supplier. Even when everything is in place, things can still go wrong. Any issues that arise should be managed and corrective action put in place to prevent the issue from happening again.

Diversify your suppliers

Using a single supplier means supply chain risks are more concentrated, and any issues with your supplier are likely to disrupt your entire supply chain. By diversifying your supplier base, you can spread risks and reduce your risks.

Have backup suppliers

If one of your suppliers is unable to fulfill their role in your supply chain, it’s your responsibility to make sure that if you prevent supply chain disruptions and delays by bringing alternative suppliers on board as quickly as possible. Identify suitable suppliers and carry out the same checks you would when choosing a primary supplier.