Getting the Entire Supply Chain on Board When Your Company Goals Change

When implementing a new process or policy at a company, communication and engagement are king.

Change management is often called an art form because it takes individuals with unique skills to make sure that a new product line, requirement or regulatory compliance rule will be implemented with minor disruptions. Human resource professionals and executives invest significant time and money in trainings, meetings and communications to ensure changes are smooth.  

The bigger challenge generally occurs when a company is attempting to convey a new policy or goal across its entire supply chain.  Nowhere is this more evident than in the area of corporate social responsibility initiatives.  A lack of communication and engagement – especially in supply chain management – can have significant consequences.  Recent media exposés have called attention to ethical sourcing controversies discovered by investigative reporters and civil organizations, even after companies claimed that their supply chains were free from human rights abuses or environmental issues. Often, new corporate social responsibility goals and regulatory compliance requirements are not effectively implemented throughout all layers of the supply chain.

For companies utilizing dozens or hundreds of suppliers, a change in policy to be more transparent or to become more socially or environmentally responsible can have significant consequences if suppliers are not proactively engaged, and if new systems and rules are not effectively communicated first with key staff and then throughout all levels of the supply chain. 

As highlighted in a recent article in a hospital trade magazine, ensuring effective change first begins with considering all departments that will be affected by a change, and how easily they can adapt. Changes within a factory, for example, are generally processed with little disruption.  A new automobile line requires multiple levels of change. However, car and truck manufacturers are accustomed to changeouts one or two times a year so they are trained to expect change.

Getting suppliers accustomed to change will also help. If a new regulatory compliance rule is being implemented and as existing regulations evolve, companies should take extra steps to communicate the change early and often. 

To ensure that supply chains are not disrupted when new rules and compliance issues are implemented, companies should consider utilizing data management and exchange software and systems that allow updates to be communicated easily and frequently.  Source Intelligence’s comprehensive supply chain management SaaS software allows suppliers to easily upload all regulatory compliance data to one central hub and share that information with their clients as often as needed. A 24/7 multi-lingual supplier engagement team is also available to work directly with suppliers to remove barriers to response. 

For more insights into how to effectively implement your compliance requirements and communicate change with your suppliers, click here.