Contractor and sub contracts can reduce cost and deliver projects, however they can also bring delays, problems, waste, extra cost and adverse PR.
Therefore, Altius has put together a list of ten possible warning signs that you may need to run a contractor health check.
1. Blind spots are a common symptom of sickly supply chains. If you do not have full visibility of your contractors or cannot plot trends and spot weaknesses by mapping the full historical data.
2. It should be fairly easy to turn information from spreadsheets into useful management reports and instantly retrieve requested data. If you’re relying on manual processes to manage a large supply chain, then chances are that you will be drowning in data.
3. Don’t over-do audits; they can be expensive and ineffective if overdone and will drain both supplier and client. Use audits sparingly and positively.
4. Failing to ensure that your contracts are cyber-compliant and data protection measures are in order, can leave your business open to breaches of data and large associated fines. You should ensure that a comprehensive cyber defence and data protection strategy is in place and regularly updated to combat the latest threats.
5. Managers often want to get to know their sub contractors and often start checking them, but the process is long and complex so isn’t always completed. Sometimes managers will insist that sub contracts are chosen from an approved list. However, if things go wrong, the first tier supply will blame you, as with the best intentions, you’ve taken away their responsibility and accountability to manage their suppliers.
6. Rising insurance premiums may be a sign that there’s risk lurking among your outsourced services and your insurer doesn’t believe you have things under full control. If you have a grip on supplier compliance, you should see premiums fall.
7. Under-using skills or having too many people bogged down in non-value added, reactive activities as opposed to utilising their talents for value added activities, such as developing supply contracts, rather than supervising and ‘policing’ them.
8. If you don’t have a full audit trail of all the up to the minute evidence available to instantly view and download anytime and anywhere.
9. If you are asking too much from your contractor assessment and stressing your contractors out.
10. If your assessment system simply measures compliance and financial solvency once a year and leaves you in the ‘dark’ about the other 364 days and crossing your fingers that you’ve got things covered for the entire 12 months. Don’t wait until the assessment anniversary to bring compliance up to date.
Altius has launched an online supply chain health check tool where you can submit answers to a quick online questionnaire and receive a customised report detailing the strengths and weaknesses in your supplier relationships and suggested actions for improvement. The report will demonstrate how much visibility and control you have over your contractors and sub contractors and identify possible areas of risk.
You can find the supply chain health check here.
Phone: 01332 960320
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