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Supply chain management:
Public and private sectors share much in common
Like the private sector, Canada’s public sector is increasingly looking to improve supply chain management practices to enhance its performance financially and to better deliver services to taxpayers.
The Ontario government’s OntarioBuys program is an example of the efforts underway in the public sector across Canada (in fact, internationally) to identify and promote skills and best practices. The Ontario program refers to it as iSCM (integrated Supply Chain Management).
Formally launched in the 2004 provincial budget, OntarioBuys is a working group made up of senior supply chain management executives from across the province’s public service, educators and leading professionals from outside the public service including PMAC’s former national board chair Larry Loop. OntarioBuys has a three-year mandate to accelerate the adoption of leading best practice in the broader public service in Ontario.
In discussion of the skills and best practices of strategic and effective supply chain management in the public sector, the question arises, “Are the practices and skills considerably different in the public sector than they are for private enterprise?”
It has traditionally been accepted that there is a gulf between the two. However, in the view of the Purchasing Management Association of Canada (PMAC), while there are areas of difference, they’re not profound.
In fact, in the words of PMAC president, Robert Dye, “The commonalities in best supply chain management practices between the private and public sectors outweigh the differences.”
More accountability
Dye acknowledges that the pressures on public sector strategic supply chain management are demanding. Increasingly, procurement departments in the federal, provincial and municipal public sectors find themselves under expectations of much greater accountability, ethical practice and maximized cost effectiveness.
However, the PMAC president makes the point that these same pressures exist to the same degree in the private sector. “In any sector of the economy, excellence in supply chain management depends on delivering value to the organization along its supply chain. That depends on the same professional fundamentals. Those are responsibility to your stakeholders—in another word, accountability—and maximizing effectiveness.”
That being said, Dye notes the public sector will be an area of increased interest for PMAC. “As we transform PMAC’s accreditation program, we are going to begin emphasizing those aspects unique to the public sector,” he says. “We have been more oriented in the past towards the private sector. As we go forward, that is going to be balanced with greater awareness and focus on the public sector.”
A white paper published in August, 2005 by OntarioBuys, identifies key areas for the development of best practices. These are planning, sourcing and procuring, moving goods through the supply chain, payment systems, structure and staffing, tools and processes and organizational alignment.
The white paper is available electronically at http://www.ontariobuys.com. Dye says PMAC has a substantive body of research illustrating what employers in all sectors view as key areas for accelerating strategic supply chain management. “These are consistent in any organization, private or public. They are cost and operational effectiveness, development and maintenance of key business relationships and maximizing organizational use and effectiveness of technology.”
In the face of the commonalities, PMAC will be making greater efforts in the future to ensure those aspects of strategic supply chain management exclusive to the public sector are better built into the association’s accreditation program.
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