| PRESS BRIEFING BY ALHAJI M.J ALIYU, REGISTRAR/ CEO OF THE CHARTERED INSTITUTE OF PURCHASING AND SUPPLY MANAGEMENT OF NIGERIA ON GENERAL BUSINESS OUTLOOK ANCHORED ON PROCUREMENT AND SUPPLY CHAIN MANAGEMENT CUM COVID – 19 PANDEAMIC ON THE 9TH JULY, 2020 AT THE INSTITUTE’S OFFICE IN LAGOS.
I warmly welcome and appreciate all, most especially the stakeholders that are present here today at this Forum, with a view to highlight some of the problems confronting our dear country Nigeria.
As I look around, I am pleased to see many familiar faces as well as new ones. Your presence here as press men and women is an indication of the interest that you all have in the wellbeing and governance process in the country with respect to the principles of transparency, due process, accountability, rule of Law and professionalism. All these will no doubt, portend a brighter future for our country as well as sustenance of our democracy particularly at this crucial stage of our economy if prudently adhered to.
In the light of the fact that Nigeria is currently facing problems in all sectors of the economy, such as security threats, dysfunctional educational system, poorly developed system, and health care facilities (Lassa Fever, Typhoid Fever, HIV/AIDS, other infectious Diseases and now Covid -19).
Issue of rape has assumed an alarming dimension in our country aside other infrastructural decay such as bad roads and other social amenities including potable water meant to improve the life of the citizenry.
This Forum therefore, provides another opportunity for us as professionals and indeed other stakeholders, to make strategic contributions towards solving the myriads of problems facing our dear country with specific reference to adherence to established policies and Laws of the Land.
The law and policies of the country are the hallmark of any nation but however brilliantly, a national development plan is formulated it cannot achieve its stated desired objectives unless the projects, programmes and policies are sincerely and efficiently implemented with necessary measurement, control and indeed performance indices.
|There is no time for false modesty or economic mis- information. We will equally try to recall those positive statements made by some Nigerians including governmental establishments, professionals and politicians among others. The fact that, we have trouble remembering positive reinforcement is a terrible indictment of our society and should emphasize to each of us the importance of sincerity in pointing out the good we see in other country and domesticate it here. This is equally a demonstration of our support for the continuation of the mission of the current administration of His Excellency, President Muhammadu Buhari GCFR, towards rebuilding our country Nigeria.|
| It is pertinent to mention that, today’s press briefing intends to promote a culture of evidence-based strategic planning and decision making tools for good governance in the attainment of lofty ideas of the present or future administration in our country and the need to create dependable frameworks and instrument for the process.
Ladies and Gentlemen of the Press, permit me to say that, an obnoxious act or conduct will necessarily invoke a cry for help as well as the need to come together as one formidable force, capable of bringing many benefits or leading us to discovering new horizon and prospects, either economically, socially, technologically and many more. Recognizing and accepting this facts, makes it much easier for us to take to calmer, more levelheaded approach to our roles as Nigerians, Stakeholders and Professionals towards solving our problems.
I am convinced that with commitments and persistence in seeking acceptable solutions, we can find the missing links and together contribute positively to the development of our dear nation.
I will like to make some basic assumptions which I consider non-contentious.
1. That there is general agreement among contemporary Nigerians irrespective of tribe, religion, profession among others to transform this country by imbibing the culture of law enforcement concept, public/private collaboration in combating corruption, security treat and institutionalizing efficiency by doing things right with effectiveness and by doing the right things all the time.
This strategy will help us tremendously since corruption involves behavior on the part of officials in the public sector whether politicians or civil servants, who improperly and unlawfully enrich themselves, or those close to them by the misuse of the public power entrusted to them.
2. That the envisaged exercise (of transformation) is feasible, if we are determined to do it because of Nigeria’s rich endowment of abundant natural resources (human and materials) and her articulate citizenry. The most powerful secret in creating a great nation or organization is having every single person thinking strategically in a common way about meaning of success and how it is achieved or delivered. In this regard, whatever may be done by government nothing affects the success or failure of a nation or any government business more than how well the long term direction is strategically set and effectively directed by the right personnel.
3. The procurement and supply chain management art and sciences is undoubtedly the driving force of global economies, Nigeria inclusive and the times we live in now more than ever, re-enforces procurement and supply chain management art and science as backbone of economy. Arising from this therefore, the procurement
| and supply chain management activities are supposed to provide the crucial leverage for the desired transformation needed in Nigeria going by the World Bank study popularly referred to as Country Procurement Assessment Report (CPAR 2000).
It is a well-known fact that, procurement and supply chain activities control a large percentage (70-80 percent in many cases) of the expenditures of many firms or government budget). In many respects, management science as it applies to purchasing or procurement and supply chain management has been maligned from both inside and outside the profession by those who believe that, the function can be performed by just anybody without understanding the art and science involved.
A good decision maker can be said to be a man with good theories on the subject matter. This may conflict with the emphasis put on practicality, unenlightened, defensive individuals who are well aware of their own ignorance of the behavior of procurement and supply chain management phenomena. Procurement and supply chain management theory has been stated in a clear language or broad terms as “VALUE FOR MONEY”.
In this regard it follows that, if theory is concerned with knowing those who dismiss it for their selfish interest or recommending a policy of not knowing the practical man (operating without a theoretical basis) is the man who does not really know what he is doing. Meanwhile, however, this is not to say that, of course, that practice is not vitally important. Frankly speaking, it is however, theory and practice that are two side of the same coin, and to emphasize one or merely neglect the other which is the main is potentially dangerous if one fails to appreciate that sound practice must rest on valid theories, and valid theories must facilitate sound practice, as not to breed Quacks.
It has been confused by the ignorant with receipt and issue of materials and supplies (storekeeping, warehouse function).
It has been dubbed “unprofessional” and the biases of sector specialists.
It has been largely ignored or de-emphasized by government officials in Nigeria for their selfish interest. The fact is that no nation and indeed business can long exist with ineffective, unorganized and inefficient practices, economic pressures will eventually destroy the former and social pressures will cause the downfall of the latter unless innovative control techniques is at the heart of the government or the management.
In this regard, strategic procurement and supply chain management is highly needed in Nigeria. This is to say that there is need for having highly trained and truly procurement and supply chain management personnel.
4. That no country is intrinsically more endowed than others with the ability to make procurement and supply chain management technological breakthroughs. Rather,
| that’s what is achieved in this field of endeavor usually depends on inputs in terms of materials, supplies, human (services) and financial resources, and that the magnitude and direction of such investment by any country is in itself, a function of the national leadership and its ideological option.
So, it can be seen that procurement and supply chain management is a major factor and force to reckon with in national economic growth activity.
It is instructive that any nation, organization that ignores or neglect procurement and supply chain management equally ignore investment and dividend of democracy.
5. Over a broader view, control of national and industrial materials and supplies bears significantly on the nation’s economy since, cyclical changes in business conditions is heavily influenced by industry’s accumulation and liquidation of inventories.
More narrowly, materials and supplies as stated earlier soak up a substantial portion of the capital invested in the individual enterprise and thus demand a continuing and considerable amount of attention from government authority.
Who in the industrial organization or nation is responsible for its materials and supplies? What activities are involved in purchasing, materials procurement and supply chain management science?
What policies and procedures are in acquiring right materials and supplies of the right quantity and quality at the right time and price? How materials and supplies are best received, packaged and transported.
All these and many more are handled typically by purchasing or procurement and supply chain managers trained in the art and science.
6. That the Public Procurement Act 14 of 2007 which has been adjudged as necessary enforcement tool to curb corruption should be implemented to the letter because, of difficulties being encountered in developing purchasing and supply control system.
This is very important if we really want to reduce government spending via procurement models or best practices based on the popular saying that “ if we don’t kill corruption, definitely corruption will kill us” as a nation.
Although, the Federal government under the leadership of President Muhammadu Buhari (GCFR) is trying his best in fight against corruption but, the need to involve the necessary professional bodies such as Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN) for technical expert advice since, most of these corrupt practices are perpetuated through procurement and contracts award.
At the Federal level, there is the Public Procurement Act enacted in the year 2007 but till date, a good number of States in Nigeria are not willing to establish State Public Procurement Law that is to regulate their procurement activities in the interest of the citizenry as taxpayers and with recourse to best practices.
| That the contracting process currently in our system should be carried out as transparently as possible to allow quality participation of Nigeria local businesses to benefit.
We should not allow a few companies having privileged information to constantly rig the bids in their favour and invariably form a cartel in Nigeria for all governmental businesses.
8 Procurement professionals trained and certified in procurement and supply chain management should be given the required support and recognition to handle the procurement function adequately and efficiently particularly during emergency issues like Covid-19, disaster management, bokoharam, handling of electoral sensitive materials among others.
PROCUREMENT AND SUPPLY CHAIN MANAGEMENT RATIONALE, ROLE AND CONSTRAINTS
To achieve the above listed objectives, a solid foundation of purchasing and supply chain management education must be laid. Hence
the crucial importance of a well though-out and adequately structured as well as, goal oriented purchasing and supply chain management science education programmes, should be taught at all school levels starting from primary education, secondary and tertiary since, the implementation will hopefully, enable Nigerians have deeper knowledge of the importance of this vital field to all human endeavor.
It is indeed the quality and orientation of such early training in this specialized field that will, to a large extent, determine their performance at subsequent levels of operations management.
If the primary school leavers are indeed lucky enough to go on to secondary and post-secondary institutions as the current policy on education (6-3-3-4) mostly asserts:-
“Since the rest of the educational system is built upon these principles, the primary level is the key to success or failure of the whole system”
PUBLIC PROCUREMENT ACT 14 OF 2007:- REQUIREMENTS FOR SUCCESSFUL IMPLEMENTATION
As we all know, the successful execution or implementation of the Public Procurement Act 14 of 2007, crafted as response towards harmonizing existing national economic development policies of the Federal Government of Nigeria, with specific reference to spend management in Procurement and contract award, has not been seriously attended to due to phenomenal attitude of those saddled with the responsibility for ensuring its implementation through engendering the good and acceptable practices as recorded in countries where, similar reforms had taken place.
| This conduct has scuttled the essence of the reforms of government policies.
The inability of government to ensure full compliance to existing Laws made by the same government for good order in the society had provided the lead way for those not having the foundation knowledge of Procurement and Supply Chain Management to jump into the foray and thus, mis-representing and mis-interpreting the intendment of the framers of the Law.
It is therefore very important to know that, for any meaningful implementation of the PAA Act 14 of 2007 in Nigeria, appropriate modalities including, quality selection of personnel and maintenance of the aim and objectives of the national reform policy of government, should take top priority and supported by other principles behind in no particular order of ranking. The benefits are:
1. Every citizen of this country should sing from the same hymn sheet
2. You won’t be bothered by silly annoying questions or statements from the uninformed , uneducated or educated illiterate
3. You and your forward looking team won’t waste time on unnecessary issues that can distract the vision and mission of the system.
4. Strategic management concept should be your guide as regards key strengths exploited to achieve the aim and objectives.
5. Be focused and as the hallmark, there is a greater sense of purpose.
The selection. It simply means ensuring that, everything is clear to subordinates exactly what to be achieved, how it should be handled to achieve the aim so that every activity can be focused on it and coordinate effectively. Every nation and even businesses needs to know where it is heading or going.
Selecting the aim must reconcile the competing views of stakeholders, investors, directors, employees, environment, socio-cultural, norms among others, each stakeholders needs to believe that the organization or nation recognizes and advance their needs and expectations.
COVID – 19 PANDEMIC AND ITS CHALLENGES TO THE PROCUREMENT PROFESSION
The current pandemic currently ravaging the whole World christened as Covid 19 has really turned our world upside down because, it took us unaware as a result of lack of what procurement professionals refers to as non-availability of buffer stock, backup or insurance against unexpected happenings.
| It has drastically change the question of everything worldwide for the past few months and its impact and individual businesses and Nigeria as a country have been evident in the destruction on economic and social lives of everybody including educational sector.
The West African Health Organization (WAHO) is the health institution under the Economic Community of West African States (ECOWAS) saddled with the mandate to ensuring the attainment of the highest possible standard and protection of health of the people in the ECOWAS region. The body has a term of reference (TOR) for procurement specialist to guide them in the emergency situation we currently find ourselves but, here in Nigeria, the procurement professionals are not given the opportunity to operate professionally and rather, non-professionals are made to dictate the pace including, importation of ideas and unknown procurement procedures and processes all in the name of the Pandemic.
The growing complexity of governance and business in Nigeria needs a rethink. The reason for this is because, governance or business has become so complex today that, the old-type or method is fast passing from the scene.
It is no longer possible to use old idea or old technology to solve modern governance process or business problems.
The Covid-19 pandemic is an eye opener for Nigeria to always get prepared for any emergency by having strategic planning which entails vision and mission statement, concepts, procedures and processes. Equally, the procurement and supply chain management profession and every other sister bodies have learned lesson and definitely we have to define practice from the pre-COVID, during COVID and post COVID eras as a result of lesson.
As a result of the panic brought about by the Pandemic such that, non-availability of necessary equipment to help in combating the Covid-19 virus on time, duly exposed our flair for inadequate procurement planning and hence, the problems being suffered by government at all levels as well as business concerns across board.
It is therefore, crystal clear that, a successful Procurement and Supply Chain Management implementation strategy is sine qua non to making materials, supplies and services available at the right time, from the right source and the right place, the specialist who directs the procurement and supply chain management matters must be in a position of top management responsibility.
Looking at the problems created by Covid – 19 across the globe, various professional fields experienced a downturn period but, succor came the way of some countries and businesses to quickly adjust to the realities by way of engaging, well-trained Procurement and Supply Chain Management professionals towards charting a home-made and innovative models in an effort to combat the pandemic through effective procurement and logistics plans for timely response.
| It can be looked at through the following key actions to avert possible problems as follows:
i. Government business continuity procurement lead model
ii. Champion remote working
iii. Communication plan for both internal and external factors cum stakeholders
iv. Supplier segmentation and prioritization
v. Strategic management principles in identifying opportunities as regard collaboration
vi. Effective and efficient contract management
vii. Identify risk in the supply chain
viii. Rethink/redraw the budget for the year and priorities.
The pandemic has really affected all sectors of the economy by taking a lot of things out of our hands.
So many lives have been lost to covid-19 and the same applied to businesses.
The institute was seriously affected with respect to all her lined up programmes for the year 2020 through which funds are generated to run the institute.
The institute does not receive single kobo from the government, so our means of survival is purely from members.
The concept of purchasing, procurement and indeed supply chain management has in recent years gained wide currency in management and commerce literatures.
Its connotation is somewhat over lapping with the concept of logistics, transport, storekeeping, warehousing and many more.
It is, therefore necessary and indeed adequate procurement skills of developing workable specifications will not only be imperative but decisive.
This is very vital because, the teaching of any subject involves the transfer and development of quality knowledge or skills needed, guided acquisition of needed information, selection process and development of concepts, evolution of positive attitudinal postures vis-à-vis the discipline studies and so on, which can be readily appreciated that the teaching of purchasing and supply management at all levels will depend on a number of parameters and this will put a stop to emergence of a two-week training to convert civil servants to handle procurement activities in MDAs and Extra-Ministerial Department, of which the products are now bastardizing this sensitive area of operations management in our dear country.
ROLE AND CONSTRAINTS
The role of Procurement and Supply Chain Management is very key in any economy. It engender good financial management protocols triggered by establishment of needs anchored on already approved procurement plan that entails processes, procedures (including bidding and evaluation), contract award and management.
| While in the private sector procurement, processes and procedures are established in the standard procedure manual in consonance with established protocols and best practices.
The overall guidance and procurement implementation strategies are developed by the procurement specialist for the approval of the management.
The above explanation goes further to affirm the belief that, no organization can function properly without effective and efficient flow of right quality and right quantity of materials to support operations.
Keeping checks on these prerequisite help to minimize time, cost and indeed improve prospects of successful completion of projects.
In this wise, formulating an adequate implementation strategy will enhance efficient delivery of service as well as procedures for timely evaluation of projects in the procurement and supply chain management activities.
It is however given that, the procurement and supply chain manager’s responsibility go far beyond approving purchases, receipts, inspection, issuing, and storage of materials among others.
To manage a project effectively, you will need a well-planned strategy based on comprehensive information as regards analysis and acquisition techniques including durability and total cost of ownership.
It has been stated on several occasions that procurement and supply chain management is the most neglected as well as humiliated among other commercial and management fields of study, what this assertion means is this, certified/qualified procurement and supply chain management professionals in Nigeria are continually denied the space to practice their profession as obtained in other climes, this is partly attributed to the overbearing as well as mid-career problems usually exhibited by other sector Specialists that, takes delight in abandoning their primary area of professional calling and venturing into procurement and supply chain functions without having requisite qualifications and certification.
All these made mess of the importance of specialization as well as professionalism in this field of study and therefore, impacting negatively on regulating the profession.
We may equally dwell briefly on some other problems militating against the practice which requires, immediate attention with a view to ensuring a procurement system in Nigeria anchored on steady growth towards achieving the crucial development goals for which the reform was established namely;
| 1 We identified the non-inauguration of the National Council on Public Procurement as contained in the first section of the PPA 2007 as one of the constraints to effective and efficient procurement practice in Nigeria.
2 Limited involvement of the technical / managerial experts produced by the Chartered Institute of Purchasing and Supply Management of Nigeria (CIPSMN) the legally authorized professional body in Nigeria and charged with general duty of:
a. Determining and reviewing, from time to time, the academic standards, knowledge and skills that shall be attained by persons seeking to qualify as registered members of the Chartered Institute of Purchasing and Supply Management ( in this Act referred to as “the Professional”)
b. Ensuring that its members maintain a reputable and high standard of behavior expected of any professional in purchasing, procurement, stores, materials, warehouse, logistics management or supply chain management in Nigeria and other parts of the World.
c. Providing for the training, education and examination of persons desiring to become professional procurers according to the provisions of this Act whether in Nigeria or abroad,
d. Regulating the discipline and professional conduct of its members
e. Promoting and projecting the welfare of its members both in Nigeria and abroad.
f. Arranging conferences, seminars, symposia and meeting for discussion of supplies and related matters, reading of papers and delivery of lectures, publishing copies of abridgement of papers, books, lectures, records and other memoranda instilling high standard of professional ability and knowledge by means of periodic issue of journals of the Institute and to organize post qualification courses for its members and
g. Performing such functions as are incidental to the objects or as the Council may deem necessary for the attainment of all or any of these objects.
As obtained today in our country Nigeria, Engineers, Pharmacists, Accountants, Administrators, Lawyers, Journalists among others too numerous to mention are laying claims to the profession thereby, providing unprofessional advice as well as counsel to their employers and the general public in a field they lack capacity and competence.
| Currently, we have heard of the establishment of the Nigerian Institution of Procurement Engineers (NiPROCE), a division of the Nigerian Society of Engineers.
This is quite novell, for the mere fact that, it’s only in Nigeria, we are seeing this kind of display of high level ignorance happening.
It calls for the Nigerian Society of Engineers to respect and keep to their professional mandate as enshrined in their establishment Act without creating unhealthy rivalry within the comity of professional bodies in Nigeria.
This is because, if this kind of professional rascality is allowed to take root, who knows when and how other professional bodies will float a procurement version of their professional bodies such as: the Nigerian Institute of Procurement Lawyers, Administrators, and Pharmacists etc.
A word is therefore, enough for the wise. It is obvious that, each and every one of us here present is a manager in his/her area of core competence since, we manage our own personnel lives and direct over our own efforts to a large degree, spending our money on motor car or vehicle, and allocating our time and space resources without recourse to anybody, raising a family, keeping a house in order, and planning for holiday trip.
All these are personal management and it is quite different from public sector management or industrial management but, the same principles applied to an industrial or public sector management.
In a nutshell, we have been moving in circus as far as the procurement best practices is concerned in this country and when compared with advanced countries where these principles and Law are borrowed and domesticated but, we seldom hear people making the habit of blaming someone else for our failure of success.
The hallmarks of good public procurement are as follows:-
5 Value for money
10 Ethical standards.
Ladies and gentlemen of the Press, it is particularly obvious from our discussion so far that, procurement and supply chain management function remains the life wire of an organization or a nation giving the pivotal role it plays, as a cost and profit center in the acquisition process.
Ladies and gentlemen, the logic behind the development of purchasing and supply chain management as a function in its own right follows from a consideration of the resources of an organization or nation in particular.
Money is dealt with by a finance or accountant. Employees problem are looked after by human resources expert.
Healths issues are looked after by qualify medical doctor.
Works and maintenance services are handled by engineers.
Legal issues are handled by legal practitioners and so a function to coordinate the often costly, and certainly complex resources of materials, supplies and services would seem to follow but totally neglected.
In the Public sector for example, it controls a large percentage of the budget put at between (70 to 80 percent of the total expenditure).
The effect of Covid -19 pandemic on procurement and supply chain activities cannot be easily quantified in monetary terms this is because, it affected the entire chain of activities with heavy toll on inbound and outbound logistics.
This gave rise to the prospect of reinventing the wheels beginning from planning, scheduling, prioritizing, sourcing and delivery.
In an attempt to establish control under the current situation as regards procurement, other specialized procurement methods were adopted including backward integration in the manufacturing concerns.
A good number of government establishments after the lockdown occasioned by the pandemic result to the use of non-competitive procurement methods such as Selective and Emergency procurement methods for their needs.
The Bureau of Public Procurement (BPP) issued directives to all procurement personnel in the Ministries, Departments and Agencies of government willing to carry out procurement on behalf of their respective establishments to follow certain established protocols.
It is in our great expectation that, the need to review procurement plans, prioritizing needs, the budget as well as timeliness should be uppermost in the mind of the procurement officers towards ensuring value for money at the end of every procurement activity.
In Post Covid-19 pandemic, it is our hope that, the Bureau of Public Procurement (BPP) will employ the service of certified procurement auditors from the institute to carry out procurement audit assignment to ascertain their level of compliance with the provisions of the Public Procurement Act 2007 as well as established protocols during the Covid-19 Pandemic.
Such action will go a long way in defining the level of seriousness and acceptance of new economic reform order with regards to Procurement and Supply Chain practice in Nigeria. Thank you all and Stay Blessed.