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Driving Savings Starts by Enforcing Compliance

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James Thomas
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Re: Enforcing compliance
James Thomas   11/18/2011 2:35:18 PM
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@Barbara. Typically when we look at compliance for procurement contracts and contract management utilization it is very often someone from senior management in the procurement/purchasing function (Director/VP sourcing or a CPO) who takes lead in measuring and mapping compliance of using the tool although IT does act as the enforcer at the ground level in ensuring contracts flow through the tool implemented. At several organizations though contract management is very closely tied with legal/admin teams and their KPIs which makes them the gatekeepers/enforcers of overall adherence to negotiated contracts and contracting terms

@Bolaji

Absolutely. In fact multiple stakeholder participation right from the time any of these projects are even mandated has to be made simpler and more prevalent. I will be taking this up in the next part of the discussion.

bolaji.ojo
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Re: Compliance
bolaji.ojo   11/18/2011 8:34:13 AM
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James, From your explanation, then, it seems compliance monitoring and the success of the entire process will depend therefore on multiple players within an organization. It should be a shared responsibility from senior executives to team leaders.

Barbara Jorgensen
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Enforcing compliance
Barbara Jorgensen   11/17/2011 4:25:41 PM
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James: I have a colleague who is in IT and it falls to him to enforce non-compliance with some of his company's (mostly IT-related) policies. Who, or what function, typically acts as the "enforcer" in companies that use contract management programs?

James Thomas
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Re: And it adds project delays
James Thomas   11/17/2011 3:24:48 PM
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@ _hm A very important and debated problem. Which is why I believe end user involvement and education in terms of a. What are the benefits when implementing new technology or processes as well as b. The compliance and performance metrics is absolutely mandatory and needs to be very effective. Also the benefits of the process need to be communicated in terms of very tangible benefits like If we reduce maverick spending by x % it leads us to savings by y% to actually appeal to people to change and in turn create a culture of compliance

James Thomas
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Re: Compliance
James Thomas   11/17/2011 3:20:07 PM
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As far as I have seen compliance monitoring is often a challenge because of this exact issue. Who exactly will be responsible for it? Well an effective if not easy way of doing this is making it a performance parameter. For example for a sourcing manager dealing with supply contracts tie in the fact that an x percentage of off contract spending will affect his rating in a y % manner. What we have generally seen at organizations is that allocation of resources for specific compliance monitoring is often a major challenge, but once the technology (say a contract management solution) has been implemented having compliance measures as part of individual or divisional metrics leads to increased adoption of the technology. and in return increased compliance. Of course it becomes imperative then for team heads ( say a sourcing director or divisional head) to thus be seriously involved in the entire process of technology evaluation as they would direct these metrics and compliance guide lines- which implies authority in terms of complete responsibility for the division or process. It works but not at all as widely used as it should be as a tactic! We have seen instances where project champions do create these metrics but they are few and far in between. 

 

 

bolaji.ojo
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Compliance
bolaji.ojo   11/17/2011 7:59:59 AM
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James, The issue of compliance monitoring is a big one for the electronics industry. It also seems to hold certain pitfalls; either it's not done well or there's no person directly charged with responsibility for this. Who in your opinion within a company should be tasked with being compliance champion and how much authority is needed to assure the objectives would be achieved?

Jay_Bond
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re:
Jay_Bond   11/10/2011 7:27:06 AM
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The biggest issue I see is companies practicing what they preach and following through. If following through with compliance regulations is needed and a best fit for the company regardless of delay, the company needs to stick to those plans to see the long term benefits. If compliance is going to deliver long term savings, that needs to be the main driving force.

mfbertozzi
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Re: And it adds project delays
mfbertozzi   11/10/2011 12:28:19 AM
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Personally, I am with James, but in my experience attituted I have found especially in interacting with managers from sales is not really in line with that process. Usually in that mindset compliance means something that introduces delay and delay means something that doesn't allow to be competitive. Given a corporation, I am convinced before starting actions as per those mentioned by James, it should be very important to enforce internal knowleddge by educational sessions.

_hm
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And it adds project delays
_hm   11/9/2011 6:40:06 PM
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Compliance is good and it has its advantages. However, it also adds significant delay to projects. Another aspect is, many time compliance is done as formality and quality of compliance work is quite poor. Can we have more simpler compliance but of high quality?



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