Transparent supplier practices lead to business success, finds global study

Friday 6 March 2020 09:09 CET | News

There is a clear link between commercial success and the visibility of supplier practices, according to a recently released study by Harvard Business Review Analytic Services (HBRAS) and Basware.

The most common factors for evaluating suppliers are based on economic and ethical considerations. 60% of respondents cite ‘value for money’ and 54% call out ‘cost savings’ as their top criteria.

Nine in ten of the 779 business executives interviewed for the report believe a culture of transparency is essential to increase employee engagement and simplify processes. The majority (59%) expect their finance and accounting arms to drive that culture of transparency. 40% of companies are keen to do more to ensure ethical best practice amongst suppliers.

Many organisations lack transparency in their supply chains with the majority of those surveyed (60%) warning that poor visibility of who they do business with is a significant source of risk. Nearly a quarter (24%) admit they fail to effectively evaluate supplier business practices, with 45% percent citing manual processes that lead to incomplete data entry as a key cause.

While executives identify the finance and accounting arms of their enterprises as key to transparency, they cite technical, organisational, and cultural barriers to fully realising the benefits of that openness. 44% percent say they lack the tools and technology to evaluate and monitor their suppliers. Alarmingly, nearly a quarter (23%) of respondents said that none of their suppliers are electronically connected to their purchase-to pay-system.

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Keywords: Basware, supplier practices, supply chains, transparency, procurement, study, Harvard Business Review Analytic Services
Categories: Banking & Fintech
Countries: World
This article is part of category

Banking & Fintech

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