(Solution) CIPS ADNOC APGCM innovative measures to improve the supply chain
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Description
Based on your previous answers assess innovative measuresto improve the supply chain (when
thinking about categories and category management)
Solution
Digital Transformation and Advanced Technologies
ADNOC which is a leading energy company is embracing digital transformation to revolutionize its supply chain management (see the following illustration);
Figure 11:ADNOC Modernisation of operations
Source: ADNOC Internal documents
A major innovation being undertaken is the adoption of blockchain technology to enhance transparency and traceability across the supply chain. Blockchain provides a secure and immutable ledger of transactions ensuring data integrity, reducing fraud, and improving compliance with regulatory standards (Smith, 2023). The Internet Of Things (IoT) is being integrated into the supply chain to provide real-time monitoring and data collection. IoT devices and sensors track the condition and location of goods, monitor equipment performance, and provide maintenance alerts thereby improving operational efficiency, reducing downtime, and ensuring the timely delivery of materials.
Strategic Supplier Relationships and Collaboration
ADNOC is also strengthening its supply chain by enhancing strategic supplier relationships and enhancing collaboration through the implementation of supplier collaboration platforms that allow for real-time information sharing, joint problem-solving, and innovation. Through the development of closer relationships with key suppliers, ADNOC can drive innovation improve service levels, and respond more swiftly to market changes (Smith, 2023). These programs include training, technical support, and capacity-building initiatives, enabling suppliers to meet higher standards and contribute more effectively to the supply chain.
Sustainability and Ethical Sourcing
ADNOC is adopting green procurement practices from suppliers who adhere to environmental and social standards, using eco-friendly materials, and reducing the carbon footprint of its supply chain (Smith,2023). By focusing on sustainability, ADNOC meets regulatory requirements and enhances its corporate reputation thereby appealing to socially conscious investors. Ensuring that suppliers comply with ethical practices and fair-trade practices is a priority. This involves conducting regular supplier audits, enforcing strict codes of conduct, and promoting fair labor practices.
Advanced Risk Management
To ensure supply chain resilience, ADNOC is implementing advanced risk management tools including risk management tools that leverage analytics to identify and mitigate potential risks in the supply chain (Smith,2023). These tools analyze data on geopolitical events, economic shifts, and natural disasters providing early warnings and recommending mitigation strategies. Proactive risk management ensures that ADNOC’s supply chain can withstand disruptions and maintain continuity.
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(Solution) CIPS Project Module 6- Project, Programme and Change Management in Procurement and Supply Chain
- Enhanced Suppliers Performance- With an upward of 50,000 orders annually with 40% valued more than 5 million Omanis and 50% 20 Million Omanis, failure to timely settle invoices, demand for high quality materials and minimising effects would be considered.
- Cost savings- With improved SRM, it is possible for Oxy to negotiate appropriate terms, lower procurement costs (5 Rights not currently achieved) hence working below targets and lead times delivery reduced and achieving economies of scale.
- Increased efficiency- improved and streamlined SRM improve operational efficiency, reducing wastes in administration process for SRM (25% of entire suppliers pay delayed)
- Risk mitigation- this include identification of risks linked with suppliers such as dissatisfaction, financial instability and geopolitical challenges
- Oxy organisation PS&M is supposed to come up with appropriate systems and techniques for improvement of SRM
- Oxy organisation need to make sure they use various automations including AI and robotics for improving collaboration and SRM efficiency.
- Facilitate policies management for improving their operations in onshore and offshore operations with an improved SRM
- Short courses on SRM need to be provided starting with PS&M leadership to achieve 50% increase in awareness of SRM improvements areas.
- Stakeholders relations improved by leveraging on available technologies of communication and interaction.
- Ensure there is 70% increase in budget on SRM improvements