The real value of a healthy supply chain

The role of procurement has evolved from the days of obtaining three quotes and choosing the cheapest.

Critical Input Senior Consultant and Business Manager for WA Henk De Vos said companies needed to invest in their supplier partnerships as part of their supply chain risk management strategy.

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“Not only does the cheapest not always equate to the most cost-effective, but it can also jeopardise the sustainability of supply as excessive cost-cutting may strain relationships or send businesses further down the supply chain broke,” Henk said.

“So while cost-optimisation is an essential supply chain driver, there must be a clear understanding of the value delivered by the supplier of the goods or services.

“The cost of the goods or services may no longer be the driver when failure to secure supply impacts revenue.”

The old adage, “If it sounds too good to be true, it probably is” is particularly relevant when it comes to developing robust supply chain strategies that withstand turbulent times.

The black swan event

COVID-19 has potentially been the black swan event prompting companies to rethink their global supply chain models.

It’s already exposed vulnerabilities within many organisations, especially those with high dependencies on China to fulfil needs for raw materials or finished products.

“When supplies are scarce, a supplier may choose to prioritise customers who have histories of paying and treating them well,” Henk said.

“Whether your key relationships are local or overseas, you still need to build trust and rapport.

“Supply chain risk has always been there, but given the current global impact, plan B may no longer be an option.

“This type of continuity planning is essential to avoid being caught off-guard.”

Look deeper

A “cost-based” analysis may focus on comparing the quoted price across a range of product and service providers, but without correct specification of quality, standards and service expectations, the cost-savings may never eventuate.

“A single good may be the result of many layers of suppliers, so it’s important to investigate if companies further down the supply chain match your company values and legislative obligations,” Henk said.

“You might have scrutinised your immediate supplier, but is one of the supplier’s suppliers of a particular component being exploited to the point of risking bankruptcy, or not adhering with Australia’s Modern Day Slavery Act?”

These are the aspects of supply chain strategies that need to be fully investigated.

Ask the right questions

Henk said he believed the real objective was to fully understand your supply chain and suggested asking the following questions:

  • Do you have an incumbent supplier or service provider and who are they?
  • What value do they offer over and above the purchase price?
  • Have there been any performance issues with them?
  • How strong is the business partnership?
  • Who are the other key players?
  • How many years have they been in business?
  • What is the percentage cost break down of the key components used by the supplier or service provider?
  • Which country are these components sourced from?
  • How does your supplier or service provider manage their supply chain both within Australia and overseas?
  • How many layers (their suppliers and their supplier’s suppliers) do they validate?  

Meet Trevor O’Neill, Senior Consultant and NSW Business Manager, Critical Input

Meet Trevor O’Neill, Senior Consultant and NSW Business Manager, Critical Input

Trevor O’Neill is a versatile project manager with 30+ years local and international experience across health, civil and commercial construction, mining/resources, contracts/procurement and major sporting organisations. He has advanced project management skills with a solid track record of successful project delivery across many industries. Trevor is an engaging and enthusiastic leader who communicates well and inspires teams to achieve.

What led you into this type of work?

I had worked in site-based roles within the construction industry for about a decade, but after a stint working on the Olympic Games, I wanted to continue seeking variety in my project management roles. So, I started consulting in 2001, and have continued the journey of working on exciting projects.

What do you bring to Critical Input that’s unique and beneficial to clients?

I keep things simple and take them on the journey.

Do you have a particular career highlight?

Probably when I took a “career pivot” away from the construction industry and worked for the organising committee for the Sydney Olympic Games for three years, including for the torch relay and the opening and closing ceremonies. It was a once in a lifetime opportunity.

Describe a typical day at Critical Input.

I’m currently doing business development work as the NSW Business Manager, following leads with potential clients.

 Is there a particular type of work that you enjoy the most?

Any type of project management.

What are some of the most common mistakes you see clients make when it comes to people and processes?

Failing to invest adequate time and resources at the front end of a project to set it up for success.

How do you know when you’ve done a good job or when a project has been a success?

The client approaches you to discuss new upcoming projects.

 If there was one thing you could change about the world, what would it be?

A fix for homelessness – everyone should at least have a roof over their head.

What’s a fun fact about you?

For the Sydney Olympic Games, I procured many items, including the Olympic and Paralympic torches, the swimming lane ropes (requiring very specific designs to limit turbulence between lanes), and all manner of props and costumes for the opening and closing ceremonies.

When backpacking in London, I got to indulge my love of sport by working as ground staff at both the Oval Cricket Ground and Wimbledon. I essentially had front-row seats at the most exciting sports events in town.


1. Integrity

2. Reliability

3. Team player

4. Diligent/thorough

5. Planning – it is important to know the path to the “finish line”

6. Cost control.

Recent highlights:

1. Hospital projects for Health Infrastructure – bringing much-needed health facilities to rural areas

2. Assisting a small rural council to deliver community projects

3. Working on greenfield projects in the resources sector

4. Teaching my nine-year-old son how to drive a manual car!