Becoming the customer of choice in Energy supply chains

One of the things I really enjoy about my role is being involved in lots of different conversations where I’m representing members and their interests. You can often see trends in those conversations and at the moment the big trend in conversations with the big customers in the sector is wanting to change how they engage with supply chain. So in this, my latest blog, I’m exploring how major clients in the energy sector are rethinking supply chain engagement and suggesting a simple way to make sure they succeed in achieving their aims.

There are a number of reasons for this:

• The SME agenda driven by government has been around for a few years and does drive conversations around engaging with SMEs. When I ask SMEs whether it’s actually driven work their way the response isn’t always a positive one and the impact of this agenda from government is sporadic from what I see, with some unintended consequences.
• The new government agenda is around localisation and place. This is still being figured out a bit and is, I think, hitting a cultural issue where commercial professionals can sometimes be struggling to get past the barriers to localisation in public sector procurement that previously prevented its inclusion in tenders.
• One that we’re seeing becoming more prominent now is clients wanting to become “customers of choice”. While the wording has been around for a while action behind it has been a little slower but recently that might just be changing.

As Clyne Albertelli outlined in his LinkedIn post a few months ago “When a Tier 1 can deliver something in-house, they usually do. Not because it’s always better, but because it’s more profitable. Charging out internal capability protects margin.” Rethinking commercial terms to deliver profit for larger companies who outsource to local SME’s would change the dynamic. It would be good for larger companies and the wider supply chain. In Clyne’s words “… when the incentives align, everyone benefits. The primes get access to agile, creative solutions. SMEs get meaningful opportunities to grow. And the public gets better outcomes for the money spent.”

Sounds simple doesn’t it? But I haven’t seen it happening anywhere yet.

Virtually every conversation I’m having with clients who are delivering national endeavours involves a discussion about how they can do things differently to develop a strong, engaged, capable supply chain to help deliver their mission. My answer to that is “Get in a room with supply chain companies, tell them what you’re trying to achieve and listen to them when they tell you how to do it.”

A recent example of this was at our BECBC Energy & Engineering Showcase in October when Sellafield Ltd came into the room to engage with supply chain companies asking around their sourcing review. Supply chain Companies felt listened to and their value appreciated. As for Sellafield Ltd, In their own words “Dianne Richardson and the rest of the BECBC team were invaluable in helping Sellafield Ltd connect with a broad range of suppliers at the BECBC Nuclear Group Energy and Engineering Showcase, who are interested in providing goods, works and services to help us deliver our mission. The feedback and input we received from members will directly feed into the work we are doing in reviewing our approach to sourcing.”

We’re now working with a number of large clients to bring them all together at our Energy Networx meeting in February for a discussion on how they, independently and collaboratively, could engage with supply chain. If you’re interested in being part of that conversation register for a ticket here.

(If you’re not currently a member of BECBC you can apply for a trial membership which will give you 2 months access to some of our membership benefits including events)

See the videos from our Energy & Engineering Showcase on our Youtube channel