Question

Explain the difference between being responsive and responsible in terms of sourcing. Can a bidder be responsive, but not responsible? Why is it so important that procurement and contracting officers ensure bidders are responsible, and not just responsive, when analyzing bids and proposals during sourcing?

Answer 1

Introduction:-

Supplier management is an extremely important stream for any and all organizations that tend to make their name over a period of time. The last thing that any organization needs in the modern times is the fact, that they lose out on inputs and have higher costs of operations than other competitors.

The main reason for companies like Walmart to have its presence for an example all across the globe, is the fact that it has been actively engaged in supply chain management right from the procurement of its raw material and which is why it has been able to maintain its costs even when others have failed to do so.

In the long run, it is important to realize, that companies that engage themselves in proper vendor management are the only ones that will be able to derive success.

That said, the companies long run aim must also include responsible sourcing to ensure that the environment and society is not impacted and that while procuring products is important it should not be unethical respectively.

Case Specifics:-

Explain the difference between being responsive and responsible in terms of sourcing. Can a bidder be responsive, but not responsible?

In terms of sourcing, responsive refers to being flexible in terms of the choices of selection that a company has towards its overall sourcing requirements. Sourcing cannot take place without being flexible in the long run, and a company must ensure that it does not sit back on the same.

The major reasons why some companies have not been able to make profits is that during peak season their supplies run out leading to lesser production and thus lesser sales.

Responsive on the other hand, refers to a technique, in which procurement that is done by the sourcing exercise, must necessarily be free from any environmental impacts or legal issues. For example some areas in the Asian Countries require child labor to work for them and produce goods such as T-Shirts and Garments. While procuring these may turn out to be cost efficient & responsive it may not be responsible for a company to procure its raw materials in this form respectively.

Indeed, a bidder can be responsive and not responsible, when though he is providing goods at a better rate to the required party, however he is not selling the products in line with the laid out environmental and social laws respectively.

Why is it so important that procurement and contracting officers ensure bidders are responsible, and not just responsive, when analyzing bids and proposals during sourcing?

Companies that grow bigger, have a high need to understand, that their main aim though is to attain profits, this ideally cannot take place without being inclusive and considerate of the environmental and social impacts that their business activities have in day to day life.

For this right from the procurement stage, it is important to ensure that bidders are not only responsive but also responsible ones. Even for smaller companies that look to become big over a period of time, it is important to realize that to become bigger or to come at a footing that is well anticipated by people, it is important for them to be able to portray themselves in a correct manner.

For legal compliance and moral obligations towards the society, and to ensure that the  bidders are not only responsive and can adjust on need basis for increased and decreased supplies, but at the same time responsible also so that the bigger concept of Social Corporate Responsibility can be achieved.

Please feel free to ask your doubts in the comments section