Local Government Procurement

Reflections on a Changing Environment Pandemic | People | Procurement

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Reflections on a Changing Environment Pandemic | People | Procurement

The coronavirus pandemic of 2020 was a historically transformative event disrupting the global economy.

It impacted our lives in many ways; we stayed home, we worked from home, we could not socialise or connect in person with others. We engaged with others using VOIP, mobile phones, facetime, messenger, zoom, Microsoft teams and video conferencing platform providers thrived. We binged on movies and TV serials and streaming services such as Netflix, Stan, Fetch, Disney etc thrived. We ordered food to our doors and delivery companies like Menulog, UberEATS, Deliveroo thrived. We shopped online and companies like amazon thrived.

The transport, travel, construction, hospitality, entertainment, manufacturing, and electronic industries suffered, some came to a standstill, and are still in recovery. With the shortage of transient labour, we now have a food shortage, particularly in the fresh food area. Sanctions on Russia have skyrocketed fuel prices. But we persevere.

As days turn into weeks, and weeks into months, we adapt. Those that could not perceive of working anywhere else, but the workplace adapted. Introverts reveled whilst extroverts pined for the loss of social interaction.

As months turned into years, yes indeed it has been years, more than two and a half years, we have as individuals, adapted, reflected, and reconsidered our options. Some who lost their careers from industries that simply ceased in early 2020 recreated themselves out of necessity.

Some, who were forced to spend time at home, found renewed appreciation of family and home, an appreciation that they were not willing to give up. Some, who were personally touched by the pandemic have made life changing decisions, such as mental health, burnout, changing careers, or changing where they live or how they live.

None of these changes are unusual. What is unusual, is the percentage of the working population making these decisions. Here are some statistics I found:

*79% of Australian professionals have up-to-date CVs and 43.4% have current LinkedIn profiles. This has been troublesome for the employer’s retention rates.

*It takes an average of 82 days to fill in a vacant position. The increased time to fill a position often results in a decrease in productivity for the team and decreased revenue for the company.

*Some insiders suggest an average of 15 applicants per job. This number depends on the industry, but it’s a significantly lower number than prior reports of 50–60 from previous years.

*Three-quarters of the Australian workforce are open to being approached by recruiters. The average cost per hire is around $21,000, so recruiters are hungry and are actively pursuing your staff.

‡Employment in Australia jumped sharply to 60,600 to a fresh record high of 13.51 million in May 2022, easily beating market forecasts of a 25,000 gain. Full-time employment increased by 69,400 to 9,443,400 while part-time employment fell 8,700 to 4,067,500. Over the year to May, employment gained 386,100 or 2.9 percent.

֎Survey Jun 2, 2021: 40% of employees are thinking of quitting their jobs.

¥ Reasons for wanting to quit included a lack of personal fulfilment, purpose or meaning, career limitations, mental health concerns and poor pay and benefits, the research showed. Other key drivers for wanting to change jobs included poor work-life balance, burnout and needing a fresh start.

Another critical issue is the realisation by organisations that procurement skills and people are needed to assist organisations in understanding global supply chain issues impacting us. Given that many organisations thought of procurement in terms of purchasing officers and inventory, a sudden shift to recruiting procurement professionals to “fill the gap and fix the problem” has exacerbated the already challenged recruitment market.

We need procurement people that can challenge the traditional “just in time” methodology for order filling to something more reliable in an unreliable global environment. We can no longer accept that we do not have new cars because there is a backlog in shipping. What if disruption happens more often? What if recovery from disruption is drawn out? Do we as a nation need to consider back up strategies?

Procurement in globalisation is all about building strong perpetual supply chains that “keep on keeping on”. This meant best value is obtained by dedicated suppliers in that supply chain. We replaced historical buying from multiple small local or national suppliers with large global suppliers, often dependant on import and transport.

Ω It will be very interesting to see where we will land in relation to future procurement methodology to compensate for disruption. Will we return to pre-globalisation, recreating manufacturing locally? Is this even practical?

Will the next procurement professionals coming through decide that brand names matter less than having products homemade or homegrown? Can Australia be part of the future and create innovative and sustainable products for home and export?

All industries have been affected and there are many challenges but also many opportunities. I believe that local government, the level of government closest to the community should be at the forefront in providing sustainable solutions through sustainable procurement.

But where do we start?

LGP’s mission from inception has been to facilitate discussion, provide a place for councils to address common challenges collaboratively. LGP Consulting provides procurement services to our sector including outsourcing solutions “PaaS”.

*7 Australian recruitment statistics that will change the way you hire (majerrecruitment.com.au)
https://tradingeconomics.com/australia/employment-change
֎https://www.weforum.org/agenda/2021/06/remote-workers-burnout-covid-microsoft-survey/
¥The Great Resignation: 1 in 5 Aussies quit their jobs last year | news.com.au — Australia’s leading news site
Ω https://procurementandsupply.com/2022/01/six-key-procurement-challenges-and-how-to-solve-them-in-2022/

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