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Employees in Brazil benefitting from standardized processes
Contractors across 80 plants supported through Avetta
Countries where LafargeHolcim operates globally
LafargeHolcim partnered with Avetta to standardize supplier evaluation across 80 plants in Brazil – streamlining sustainability compliance, improving contractor prequalification, and strengthening supply chain transparency.
When a company the size of LafargeHolcim makes a serious commitment to sustainability, quality, the environment and to the health and safety of the people who work at its many plants and job sites around the world, there are significant implications to all processes. Policies must be applied throughout the supply chain to manage the way LafargeHolcim purchases goods and services in every unit.
The company set ambitious goals for its global operations, including:
In Brazil, LafargeHolcim employs 2,400 employees and 2,300 contractors in its 80 plants around the country. The high number of contract employees made it very difficult to manually handle prequalification and other evaluation processes.
“Before [the merger], we did the whole process of supplier evaluation through e-mails and Excel spreadsheets.”
- Cristiane Oliveira, Procurement Specialist, LafargeHolcim, Brazil
This situation inevitably led to increased risk, including a lack of standardization in the way contractors were evaluated. Various people performed the evaluations, which created the opportunity for different criteria to be applied.
There was no simple, objective way to measure a supplier’s record on social responsibility, human rights issues (bribery, corruption, child labor, and so on), and other issues related to sustainability. These factors impacted supplier onboarding and limited visibility into supply chain risk.
To develop more efficient and objective methods of evaluating suppliers, LafargeHolcim started the process of identifying a vendor to help with supply-chain management.
The vendor analysis was conducted at the corporate level with the participation of procurement teams in the various national offices, including those in Brazil, Argentina, and other Latin American countries. The company ultimately selected the platform to support the sustainable procurement process specified for addressing the risks in the supply chain.
The platform provides a web tool and services necessary to outsource the administrative activities related to the qualification of suppliers, allowing employees to focus on risk mitigation and the development of suppliers.
“We evaluated other vendors, other possibilities, other platforms, however they really listened to our business needs and accommodated our process in their solution to better satisfy our needs. Another important point that contributed to the choice was the flexibility and provision of services in the different regions in which LafargeHolcim operates.”
– Cristiane Oliveira, Procurement Specialist, LafargeHolcim, Brazil
Once the decision was made, LafargeHolcim worked with Avetta to implement a process for prequalifying suppliers that focused on sustainable procurement and the health and safety of contractors. The new platform went live in April 2016, with Brazil as a pilot.
Avetta helped LafargeHolcim standardize supplier evaluation processes in Brazil. Working with Avetta to perform supplier evaluations enabled greater objectivity in the process, ensuring uniform standards and allowing the company to determine which suppliers met its sustainability and health and safety standards.
Avetta provided “an outside perspective of vendor risk,” said Cristiane, recognizing that “our department´s know-how is in contracting and not in evaluation.”
In addition, once a supplier is evaluated and prequalified for one job site or factory, the supplier would not need to be evaluated again for other job sites. This reduced paperwork for contractors and eliminated the need for staff to manage prequalification forms via email and spreadsheets.
Avetta also provided the ability to assess suppliers based on their human rights record, which LafargeHolcim had not done before. “Our assessment was very much concerned with health and security, and issues of Brazilian law,” says Cristiane, “but it did not have this vision of human rights, social responsibility, or compliance with the LafargeHolcim sustainability guidelines.”
The company also surveyed suppliers to gauge their perceptions. Suppliers emphasized the excellent service and friendliness of Avetta representatives. They called the platform “very intuitive” and praised Avetta’s fast response to urgent issues and support with action plans.
Cristiane Oliveira notes that LafargeHolcim recently reached a milestone with respect to the number of suppliers fully qualified and approved for contracting, as indicated by a green flag in the system. “It’s been a successful implementation, with a satisfactory degree of acceptance by suppliers, employees, and the board of directors.”
LafargeHolcim, now Holcim Group, is the world leader in the building materials industry, with operations in 90 countries. The company specializes in cement, aggregates, and concrete, with a commitment to sustainability, innovation, and “zero harm” health and safety practices.
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