Our supply chain is largely made up of material (commodity) suppliers and sub-contractors, who make up the bulk of the 12,000 or so people who work on our sites every day. The Group procurement director, supported by the procurement team, is responsible for the procurement of key commodities across the business, which are then purchased at a project level by the local buyer. Sub-contractors are locally selected and managed by the relevant business unit.
Our strategic approach, as set out in our Group procurement strategy, has the following aims:
develop long term, stable relationships with top performing suppliers and manufacturers
ensure that our trading relationships remain on a price competitive basis at all times
develop multi-level supply chains
act with honesty and integrity at all times
adopt a non-adversarial approach to dispute resolution.
Recent initiatives to enhance our supply chain relationships include:
Supply Chain Business Briefing. We hold these events annually to keep our preferred suppliers informed on topics such as the supplier experience and our sustainability strategy.
Better payment systems. As well as being a signatory of the government's prompt payment code we have introduced a new "iSupplier portal" which gives our supply chain partners access to our Purchase to Pay system, where they can see the status and progress of their invoices. We believe we are the only construction company that has introduced this sort of facility.
Supply Chain Sustainability School. We encourage our suppliers to enrol in the Supply Chain Sustainability School, an initiative that supports a common approach to addressing sustainability within our industry. Suppliers who join can use a self-assessment tool to evaluate their own sustainability performance and then based on this, receive a personalised training plan and access to the numerous school events we run. Through our relationship with the School we host training workshops on topics such as CEEQUAL, responsible sourcing and carbon.
We have also set up a cross-functional team to identify how we can continue to attract and retain the best supply chain partners.
Selection and management
Robust procedures guide our supplier selection process to minimise the risk to our projects. As well as looking for suppliers with sustainability credentials aligned to ours, we also consider the environmental impact of the materials we use. For example, one of the reasons we use Knauf blown cavity insulation is that it avoids the offcut waste creation seen in more rigid insulation products. We are also committed to sourcing sustainable timber (FSC or PEFC certified) where we can.
We have an electronic sub-contractor on-boarding process to improve efficiencies in this area.