THE FACULTY QUARTERLY

SPRING 2013

Commercialising supplier innovation

Supplier innovation must improve to address productivity imperative

Declining productivity, and rising production costs, is forcing the hand of Australia’s largest mining organisations towards a productivity focus in 2014.

Upon taking the company reins midyear, BHP Billiton
chief executive Andrew Mackenzie, quickly brought attention to the issue:

“We must all get sharper at productivity. For us, every 1 per cent improvement in productivity translates to a $170 million saving.”

The Faculty is undertaking research into the potential for procurement to deliver this much needed step change in productivity through supplier innovation.

The project is a strategic collaboration with a range of industry representatives including The Department of Industry, CIPSA, Minerals Council of Australia, Austmine, AiGroup, Hopgood Gamin and the Business Council of Australia.

A key outcome is to understand what challenges are faced, opportunities exist and support is required in the evolution of the procurement profession beyond cost.

In recent study of the Australian Mining, Equipment, Technology and Services sector provided clear feedback on their experiences of suppliers to date with procurement:

“60% percent of firms identify difficult procurement processes as a significant or very significant challenge for the firm.” – METS survey, Austmine 2013.

All survey respondents will receive a summary with key insights from the research.

To participate in the online survey, please click here.