On Day 2 of the Institute for Supply Management’s 102nd annual conference in Orlando, the Rt. honourable David Cameron, former Prime Minister of the United Kingdom, gave an impassioned speech to more than 2,500 procurement and supply management leaders and practitioners on geopolitics and supply management. ISM leaders invited Mr. Cameron to speak at this year’s event because of his prominence in the international political world; but also because under his leadership, Mr. Cameron led Parliament during heightened economic and political uncertainty at home and abroad — uncertainties that continue today.

It was a tragic coincidence that, not 24 hours earlier, the good people of Manchester, UK, sustained a deadly bombing at a concert — as if to underscore the insecurity and instability permeating society, and the harsh reality that the First World is not immune to indiscriminate violence. Appropriately, Mr. Cameron began his speech on a somber note, reflecting on the attack and expressing a loss for words for the continued targeting of innocent civilians in a war not between Islam and the West, but rather, in a war within Islam (“a beautiful religion” with more than a billion practitioners). A masterful orator, Mr. Cameron deftly segued to the topic du jour, which was the important role that supply management plays in the world — now and in the future.

Supply Management: Making the World Go ‘Round….

As Mr. Cameron said, supply management teams make a deep and lasting impact on global business and commerce. They establish and maintain supply chains, reduce costs, increase savings, and deliver goods and services to organizations and people world wide. “It may seem that politicians make the world go ’round, but it’s actually supply management,” said Mr. Cameron, echoing the words of General Colin Powell who, a day earlier, said that “an army travels on its stomach.” Truly, an organization cannot sustain itself or move forward without adequate supply and reliable resupply.

One of the things that David Cameron is best known for, particularly at home in the UK, is his successful effort to transform public procurement within the British government. Under his stewardship, British governmental officials streamlined the bureaucracy, migrated procurement operations to the cloud, and made it illegal for public officials to personally profit from any business arrangements to which they are a party.

…And Saving Lives and the Environment

“Ethics and sustainability are at the forefront of what you do,” said Cameron, who noted that while he was Prime Minister, the British Parliament passed the UK Modern Slavery Act, which criminalizes human trafficking and modern slavery practices, and provides legal protections and recourse for victims. “Sometimes the worlds of politics and business seem miles apart,” Mr. Cameron said, but in this case, “they’re actually quite close.

“I have always believed in responsible capitalism,” he continued. “You can’t turn a blind eye [to things like modern slavery or child pornography] and say ‘it’s not my problem.’ You need to get involved.”

Moreover, ethical and sustainable supply chains are not just good for people, animals, and the environment, they are good for business. Today, more people care about the origin of their products, how they were produced, the welfare and rights of the people and animals who produced them, and the impact on the environment. Many organizations have supplier codes of conduct, corporate social responsibility policies and mission statements, and they market themselves as “green,” “sustainable,” “ethical,” or “fair-trade” friendly. And at a time when a viral tweet or slick internet meme, unfounded or not, can doom an organization’s reputation, supply management practitioners are the vanguard of the brand. They need to ensure that the organization and its supplier base adhere to these high-minded ideals — not just because it is the right thing to do for their business, but because it is the right thing to do, period.

As Populism Rises, Protectionism and Isolationism Loom

Mr. Cameron moved on to address one of the elephants in the room: the rise of populism in Europe and the US, with the passage of Brexit in the UK and the election of Donald Trump as President of the United States. As he said, three major events over the last two decades have shaped this current economic and political environment: 1) the terrorist attacks on 9/11, 2) the Iraq War, and 3) the Global Recession. These three linear events have combined to fuel populist movements and political candidates in the West who speak to the cultural, economic, and political anxieties permeating the working classes.

Despite a relatively strong and quick economic recovery in the UK, many people were left behind, just as they were elsewhere in Europe and in the US. “A rising tide did not lift all boats,” said Mr. Cameron. As a result, many British citizens were unhappy with their tax dollars going to the EU while being forced to accept immigrants and refugees, particularly from the Middle East. Some of these were taking British jobs, poorly assimilating into British society, and threatening their security. As Mr. Cameron said, most pro-Brexit voters are not racist — they are just “fed up” with their representatives who have seemingly ignored their concerns in favor of the EU and the ideals of liberalism. The same can be said for American voters who voted for Donald Trump, who is perhaps Brexit personified and even declared himself “Mr. Brexit.”

Although Mr. Cameron regrets the result (indeed, he resigned over it), he does not regret letting British citizens exercise their right to self determination and let their voices be heard. Moving forward, he urges politicians to listen to their constituents and address the causes of populism rather than ignore them. Failing to listen (or to allay their fears) resulted in the first populist president in American history since perhaps Andrew Jackson. And “sooner or later,” Cameron said, a populist candidate will win an election in Europe. Most recently, far-right candidate Marine Le Pen nearly became the president of France, having won 50% of an initial vote before ultimately losing to Emmanuel Macron by a 2:1 margin.

In Defense of Globalization and Free-Market Economics

In response to the rise of populism, Mr. Cameron cautioned against embracing protectionism and isolationism (e.g., leaving international organizations, like the EU and NATO, or free-trade agreements like NAFTA and the TPP). Globalization and free-market capitalism are not zero-sum games, where there are winners and losers, said Mr. Cameron. Yes, “some countries get more than they give.” But governments and politicians should improve trade agreements where they can rather than withdraw from them. They should redress trade deficits, address local ethical and sustainability concerns, and use agreements like NAFTA as a form of “soft power” to influence developing countries to improve labor, environmental, or agricultural practices. “We shouldn’t throw the baby out with the bath water,” said Cameron.

Although outsourcing and automation continue to replace labor-intensive but repeatable and scalable jobs, like manufacturing, it is not all bad news. Business process automation and robotic process automation also create jobs — a point made by Gen. Powell and Tom Derry, CEO of ISM the day before. Computer programmers, software, electrical, and mechanical engineers, plus a slew of other “white-collar” jobs (e.g., sales, marketing, and C-suite positions) are created to support the burgeoning digital economy. Work is not necessarily going away; but the nature of work has been changing for quite some time. Unfortunately many people have fallen behind in “the new economy”; they need to adapt to the digital economy or risk being left behind for good. [As an aside, ISM has been working over the past few years to help supply management professionals train and retrain for the “Future of Work” with services like professional certifications, the Mastery Model, and eISM, its newest digital learning platform.]

Final Thoughts

We live in uncertain times, with more economic, political, and reputational risks to monitor and manage, and a geopolitical landscape that continues to shift and fracture. But as David Cameron emphatically said, globalization, free trade, ethical sourcing, and sustainability are at the heart of what supply management practitioners do. They have the power to make tangible differences in the world — like driving innovation into business processes, driving agility and resiliency into supply chains, making supply chains more sustainable, and fighting the scourge of modern slavery. And in a world that continues to flirt with protectionism and isolationism, supply management leaders also have the ability to project “soft power” abroad to win and influence friends and protect the bottom line at home.


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Uncertainty Looms for 2017 – Part I

Procurement 2017: When Trends Collide

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