John Deere, Nucor Urge Supply Managers to Join Regulatory Process

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Last week several members of our team had the pleasure of speaking at the Institute for Supply Management’s annual conference. The extended Spend Matters team spoke on a range of topics, from Sheena’s talk on branding oneself in procurement to Jason’s chat with T. Boone Pickens and his observations on the lack of contract management providers.

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But I had the most fun because I had the opportunity to moderate an an extremely well attended, not to mention lively, session called The Impact of Regulatory Issues on the Future of Supply Management with my colleagues Collis Jones, Director of Congressional Affairs of John Deere, and Jennifer Diggins, Director of Public Affairs for Nucor.

Our Mission

We endeavored to examine the legislative and regulatory issues of concern to both manufacturing organizations as well as business in general and at the same time, to try to bridge the gap between today’s regulatory environment and the supply management function. We also wanted to address the role of procurement with regard to the regulatory environment by specifically addressing the questions of what should the role of procurement be in quantifying cost/benefit impacts of various regulations on the business? Should this be solely left in the hands of corporate public affairs or should procurement take on a more active role?

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Setting the Context

It didn’t take long to cover a broad swath of issues impacting most manufacturers in one way or the other from the Water Resources Development Act (WRDA) to the Clean Air and Water Act to the Highway Transportation Bill to grassroots efforts in place to ban the practice of fracking.

In addition to a general discussion of the issues, the panel introduced the concept of “net benefits,” a concept that goes back to the Reagan administration ensuring that businesses of all sizes be given the flexibility to meet important standards without blanketing them in insurmountable costs. The notion of “net benefits” suggests that every regulation stems from an approach that achieves the highest net benefits possible.

Leaving partisan politics aside, that framework creates a reasonable approach and continues to this day.

So what did the panel say regarding the role of procurement in quantifying the cost/benefit impacts of various rules?

According to Jones, “if you aren’t involved in the process, you will certainly suffer the consequences.”

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