How can accountability be better managed in long, global supply chains?
“Accountability traditionally meant writing favourable terms into a contract, monitoring vendor performance and then working with the supplier to uphold its obligations” (www.ey.com)
While these terms are very important, leading organisations have found that in the supply chain, every sector needs to be addressed and accountability must be incorporated into every level, from supplier to customer.
Negotiating a good contract is only a small part of accountability while the most important part is compliance. Each supplier must comply with obligations in the contract they signed. In the case of Mattel, the paint supplier did not comply with the…show more content…
Some of these problems in the supply chain often go unnoticed as the number of links between supply network members. Supplier Ethics Management is the “management of suppliers and supply relationships with strategies, programs, and metrics that better align supplier business conduct with purchaser standards, with the goal of reducing the purchaser’s overall risk of corporate integrity failure in the supply chain.“ (www.s-ox.com)
As we can see Mattel does a pretty good job of of managing risk within its own business. However, it is some of these large multi national companies that often overlook managing corporate integrity risk in there supply networks. Companies have inserted clauses into their standard contracts with suppliers requiring them to comply with the rules and regulations applicable and materials used must exactly that which has been stated in the contract.
Better Managing Global Supply Chains
Most companies lack the ability to quickly contact each outsourced supplier, vendor or licencee in their supply chain. Many companies have done alot of work in the area of managing global supply chains better. A web based Supplier Ethical Management (SEM) platform has been developed which allows companies to maintain contact information for most or all of its suppliers and communicate critical information to them on a regular basis. Using an SEM platform is probably