2.1.3.3Supply Chain
Management approach
The current business and health environment is driving major changes, with risk resilience and new market standards requiring that the Company has a new supply chain organization. To continue the drive to transform the industry by adopting our Fast4Ward® principles with the highest level of safety, performance and quality, the Supply Chain management is evolving into a strategic globalized product organization reporting into the Company’s Global Rersources & Services organization. Leveraging our long-term relationships with our key supply chain partners will also contribute to accelerating our time-to-market objective and our performance in the Win phase.
With good execution of projects remaining essential, SBM Offshore supply chain management is continuing its efforts to support projects locally by development of capability hubs, for example in China and India.
The pandemic has demonstrated the value of ’framing global, acting local’ and aligning supply chain strategy with the product life cycle. The supply Chain organization contributes to the Company’s strategy as described in section 1.3.2.
2020 performance
The development of the supply chain organization has been developed further around five strategic pillars :
Competitiveness improvement
Strategic sourcing is leading supplier-collaboration initiatives, introducing a clearer governance structure for the overall supplier-collaboration program. Through this the Company is improving competitiveness, by encouraging full participation and ensuring parties pursue long-term win-win opportunities.
Local content strategic approach
The globalization of supply chain core competencies, across all SBM Offshore pillars, with a clear focus on business drivers, increases product ownership. Faster local support to projects has allowed the Company to capture value and gain more flexibility.
Vendor Performance
The vendor qualification work done over recent years has shown that closer relationships between buyers and suppliers create value and help the supply chain become more resilient. The logical next step is a cross-functional engagement to achieve strategic alignment in managing the performance of SBM Offshore vendors. In line with Company commitments to reach its sustainable development aspirations, the supply chain organization has developed a full human rights assessment as part of the vendor qualification program, thus improving social impact.
Time-to-market improvement
Supply chain is now responsible for the full procurement strategy across SBM Offshore’s Win, Execute and Operate phases, allowing the Company to optimize the process, engage early and, as a result, reduce schedules.
Digital supply-chain transformation
Group Supply Chain is one of the main stakeholders involved in the design and implementation of SBM Offshore’s global ERP system, to streamline the flow of information and processes from project execution to operational activities.
Performance measurements :
- 9 Steering committee meetings organized with strategic vendors
- 1,599 vendors qualified under the revised qualification process since 2017, including more than 120 Chinese vendors
- 99.4% of vendors have signed the Supply Chain Charter
- 90 vendors have had their qualification renewed following satisfactory performance
- 65 vendors have responded to SBM Offshore supply chain organization’s new human rights assessment (more detail in section 2.1.2)
future
Next year, Group Supply Chain will maintain recruitment efforts to support company development in all locations, with a key focus on strengthening our vendor performance management processes and tools to ensure seamless delivery at the framing stage of Operations activities. Group Supply Chain will ensure that the strategy defined at Win phase is properly implemented during the Execution phase.
