Room to improve in chemical firms

Supply Management,  Jan 17, 2008  

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Chemical firms have failed to develop their procurement functions, despite improving the rest of their supply chain in the past two years, according to a study.

A report from Accenture said the approach to procurement was mixed, with direct spend often centralised, and indirect spend decentralised. It found 72 per cent of firms source direct materials with a rigorous process. But only half of firms do the same for their indirect spend.

"There are still areas for improvement," said Christopher Lange, author of the report and senior executive in Accenture's chemical practice. "In a competitive global landscape, sharing best practices will be critical to increasing performance," said Lange.

There was a similar trend when it came to compliance. Some 82 per cent of sourcing decisions were followed by the company with direct spend, but this figure fell to 59 per cent on indirect spend. The survey interviewed 400 supply chain professionals at 150 chemical firms.

Copyright Chartered Institute of Purchasing & Supply Jan 17, 2008
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