Some may be aware of the Triple Bottom Line; Planet, People and profit. Often these principles can be seen to be conflicting. We’ve all been there, looking at the supermarket shelves and comparing an organic piece of fruit, vegetable or meat to its non-organic counterpart. Many still select the non-organic chicken, banana or potato purely because it is cheaper, even though there is often a wider value to the organic version.
This is one of the challenges of procurement, taking into account the broader picture and obtaining products and services that contribute the best overall value to the organisation.
This is one of the challenges of procurement, taking into account the broader picture and obtaining products and services that contribute the best overall value to the organisation.
However, not always are these principles in conflict and I was only reminded of this earlier this week. Our washing machine is over nine years old now and has been under a special insurance policy which covers all repair and breakdown. In the eventuality that the engineer cannot fix the machine it would then be replaced at no cost.
Over the last two years we have had the engineer in quickly to diagnose the fault and carry out the repair a small handful of times. Sometimes new parts were needed and we had to wait one or two days longer. Striking up a conversation with the engineer on Monday he stated that, after a new computer and motor were installed, it would practically be a completely new machine within its existing shell. Working in procurement I couldn’t help myself by carrying out an exercise comparing the amount spent on the premiums (which also includes other white goods in our home) to the cost of a new machine. It turned out that our premiums were significantly less, especially taking into account that the new machine could have even been replaced again afterwards.
Apart from the savings, further benefits were also incurred such as the broken parts being recycled and reused into an established supply chain and reduction of landfill. Profit and planet both win.
Calling back to the old days I remember my Grandparents telling me to ‘make the best of what you already have and watch your pennies’. I’ve heard some good stories recently where the Oil and Gas Industry has picked up on this established concept to save costs and reduce spend on new equipment, machinery etc. Additionally, with decommissioning activity increasing by the month there is much more a need to have a structured supply chain in place to handle assets that are just a bit larger than washing machine.
Over the last two years we have had the engineer in quickly to diagnose the fault and carry out the repair a small handful of times. Sometimes new parts were needed and we had to wait one or two days longer. Striking up a conversation with the engineer on Monday he stated that, after a new computer and motor were installed, it would practically be a completely new machine within its existing shell. Working in procurement I couldn’t help myself by carrying out an exercise comparing the amount spent on the premiums (which also includes other white goods in our home) to the cost of a new machine. It turned out that our premiums were significantly less, especially taking into account that the new machine could have even been replaced again afterwards.
Apart from the savings, further benefits were also incurred such as the broken parts being recycled and reused into an established supply chain and reduction of landfill. Profit and planet both win.
Calling back to the old days I remember my Grandparents telling me to ‘make the best of what you already have and watch your pennies’. I’ve heard some good stories recently where the Oil and Gas Industry has picked up on this established concept to save costs and reduce spend on new equipment, machinery etc. Additionally, with decommissioning activity increasing by the month there is much more a need to have a structured supply chain in place to handle assets that are just a bit larger than washing machine.
