Supply chain leadership and the important role that the oil and gas sector plays in the Canadian economy ranked high among themes at the National Supply Chain Forum, held at Calgary’s BMO Centre from November 12-14. JuneWarren-Nickle’s Energy Group and the Supply Chain Management Association (SCMA) Alberta hosted the event.
That leadership role was emphasized by Cheryl Paradowski, SCMA’s president and CEO, during opening remarks. Speaking to attendees on the event’s first day, Paradowski highlighted the new name of the name of the organization (formerly the Purchasing Management Association of Canada, or PMAC). The word “Canada” was left out of the name of the organization, which is an amalgamation of the former PMAC and Supply Chain Canada (SCL). These days, supply chains are global,
she noted.
“We feel that during the course of this amalgamation we’ve created the premier supply chain organization.”
The new organization, officially created September 3, has developed a new strategic plan focusing on the employer as customer and the SCMP designation holder as the product. Employers now recognize the contribution of supply chain management professionals to their organizations, Paradowski said, and SCMA’s goal is to produce designation holders with the right skills and to ensure companies know about them.
The organization’s action plan for 2013-14 includes completing the amalgamation; performing employer market research; maintaining an advocacy and outreach program and governance review; increasing the amount and quality of research and building relationships. The organization will also combine its symposium and conference in 2014, she noted.
Growing the West
Growing Alberta’s economy was the focus of comments from Michelle Rempel, Alberta’s Minister of State, Western Economic Diversification, during her address to delegates. To do so, the federal government launched a program to help Western Canadian businesses bring new technologies to market. Through the program, called the Western Innovation Initiative (WINN), SMEs based in the West can recieve funding to help commercialize new products, Rempel said. The program offers up to $100-million in repayable funding over the next five years to help organizations with product testing and technology demonstrations, equipment purchases and installation, regulatory approval, marketing and intellectual property protection. Rempel noted the program aims at smaller firms across sectors like clean technology, energy, aerospace and defence and others.
She stressed that Alberta’s energy sector had a significant impact on the Canadian economy, from creating jobs to generating revenue. But one of the challenges, she said, was to do so in a way that was environmentally sustainable.
“We believe that we can have our cake and eat it too when it comes to long-term growth in an environmentally successful way,” she said.
One way she noted to help drive economic success was to bring people and organizations together with opportunities. For example, Rempel said, her department helps Alberta’s women entrepreneurs gain access to the supply chain through training and other avenues.
“We do see ourselves as a convenor and we have an open door policy,” she said.
Another announcement came from Janet Dorey, regional director at Public Works and Government Services Canada (PWGSC) in Edmonton, who told delegates that as of June 1, the federal government had transferred its online procurement process to buyandsell.gc.ca.
The new system would help the government gain access to suppliers that had previously been missed, Dorey said. Ottawa spends $20 billion each year, she noted, so many procurement opportunities exist for organizations on the market. “This program is going to give us some really interesting opportunities,” she said.
Social impacts of supply chain business decisions also came up during the conference, as Kyle Peterson, managing director of consulting firm FSG, posed the question of whether it’s possible to increase the impact of business activities within communities while also benefiting those organizations.
“We hear frustration because the money (spent) keeps going up, but there aren’t measurable results to show for these particular types of investments,” he said. “The benefits that do come are from headlines, but that can be fleeting.”
Organizations are often reluctant to connect corporate social responsibility with benefits to those organizations, Peterson noted. Discussion had evolved from thinking that no problems existed, to worrying about an organization’s reputational risk to the current situation where companies feel they should do something about social issues in the communities in which they operate. The next phase, he said, was to see opportunities.
Investing in talent is an example of what Peterson called a shared value, and a lack of talent in communities in which oil and gas companies operate can be a challenge. Investing in that talent can benefit not only the community by reducing joblessness but companies operating in those communities, since they then don’t have to fly in talent from elsewhere.
Instead of redistributing existing value, companies can create shared value by addressing social needs through their business, Peterson noted. Doing so benefited both the organization and society. He recommended that organizations shift their perspective from risk to a long-term view of how community problems intersect with those of businesses.
Supply chain effectiveness
There’s no question as to how important the oilsands are to Canada’s economy, noted Jayson Myers, CEO of Canadian Manufacturers and Exporters, who also addressed the audience. But he questioned why organizations involved in the industry struggled for competitive ROI. The issue, he noted, came down to the efficiency and effectiveness of the supply chain.
“What’s really crucial is the need for better collaboration, better communication, more trust across the supply chain,” he said.
The oilsands provide a centre for manufacturing demand and generate new customers in Canada and across international markets, Myers said. Businesses there procure $10 billion in goods from across the country. Meanwhile, imported products account for 36 percent of new capital investment in the oilsands and 12 percent of maintenance, repair and operational expenditures. Construction and mining equipment accounts for 75 percent of new capital imports.
But challenges exist not only within the industry—including a labour shortage—but also across the supply chain, Myers said. If oilsands industries want to be profitable, they must look to improve efficiency, he said. Good communication and proper management of supply chain relationships were essential. Suppliers must see themselves as partners, while buyers must be ready to talk to suppliers about supply chain problems, he said. Otherwise, the industry will be stuck in a situation that’s unprofitable, dysfunctional and inefficient and risk losing out on investment.
During one of the conference’s breakout sessions, a panel discussed how oilsands organizations can build long-term partnerships with Aboriginal businesses and suppliers. Andy Popko, vice-president of Aboriginal relations, NCSG Crane & Heavy Haul Services Ltd., recommended finding a contact in the area or region in which the company operates. Similar to doing business with a new company, Popko recommended researching to find out everything possible about the First Nations group.
“You need to have the tools in your tool box to have that conversation,” he said. Popko also recommended organizations send decision makers to deal with First Nations, rather than different employees each time. Doing so prevented wasted time and ensured the relationship progressed.
Fellow panelist Steve Jani of Christina River Enterprises and a Metis of the Fort McMurray Wood Buffalo Region, said he gets daily calls from organizations about potential partnerships. There’s no “cookie-cutter way” to form a partnership with Aboriginal groups, and organizations outside of Alberta could also do so.
“It’s not impossible to come from Ontario [or other areas] to build a partnership in the oil sands region,” he noted.
The conference highlighted the theme of improving supply chain practices to drive success. Certainly, attendees left with ample tips and best practices to do so. B2B