Proxima: delivering true value in procurement
Clare Harris, Executive Vice President Operations, describes how Proxima has established itself as a world leader in procurement consultancy services.
Over the last 25 years, Proxima has established itself as a world-leading expert on procurement consultancy services, helping a broad spectrum of customers to unlock their supply chain’s full potential, from the largest Fortune 500 entities to bespoke startups. Part of the company for over 15 years, Clare Harris, Executive Vice President Operations, states that her role has two primary responsibilities: 1) solve commercial challenges and 2) take advantage of commercial opportunities. “Ultimately, we work with our clients’ procurement and commercial teams to help drive value from their cost base.”
As a company, Proxima helps customers optimise what they spend with suppliers and build exceptional procurement functions. “When you think that, on average, about 70% of organisational spend is with suppliers, then you can immediately understand the potential that exists for savings and innovation,” Harris states. However, it isn’t necessarily a purely ‘cost-saving’ exercise; the company specialises in maximising the value of every penny spent. “It’s about understanding what value means to our clients, whether that’s cost, speed, return, risk efficiency, or quality. There are multiple perspectives across our client base.”
Contributing to the company’s enduring success has been a flexible strategy focused on being adaptable to the changing supply chain environment. That evolution, Harris says, has been characterised by increased networking, collaboration and emphasis on procurement itself. “The focus on churning through transactions and processes actually eroded value over time. I think procurement is moving more to the heart of organisations and it’s also becoming increasingly diverse, with many more female leaders today.”
The benefits of this industry development have been keenly felt by Proxima’s clients. One in particular, Arm, shares a close working dynamic with it: “Proxima has been able to bring both commercial expertise and category knowledge, while also injecting capability at a time when Arm’s existing procurement team were quite stretched,” Harris explains. Establishing a “two-way feedback” loop, the collaborators have been able to react swiftly to challenges and coordinate decisively, “We work together at pace and deliver value quickly.” Using different time zones to its advantage, Proxima’s UK team can hand over to the US team and vice versa, creating a continuous cycle of problem-solving capability.
This kind of partnership will prove vital in the post-COVID-19 world, where traditional operational patterns no longer hold true and an innovative mindset is crucial. As other companies strive to build an operating model for procurement that matches today’s challenges, Harris believes that Proxima’s breadth of expertise will become even more valuable. “When we first locked down, there was a feeling that businesses would, to some extent, ‘batten down the hatches’ and just focus on cost. However, I think a lot of them are now asking, ‘How can we transform ourselves to make decisions quicker?’, and that theme will continue into 2021.” Proxima’s aim, then, will be to guide that development and continue its ongoing mission of delivering real value to its customers.
EU and US agree end to Airbus-Boeing supply chain tariffs
The EU and US have agreed to resolve a 17-year dispute over aircraft subsidies, suspending tariffs on billions of dollars' worth of goods that have plagued procurement leaders on both sides of the Atlantic.
Under an agreement reached by European Commission Executive Vice-President Valdis Dombrovskis and US Trade Representative Katherine Tai on Tuesday, the tariffs will be halted for a period of at least five years.
It will bring an end to punitive and disruptive levies on supply chains that have little to do with the argument, which became embroiled in the trade battle. Businesses on both sides of the dispute have been hit with more than $3.3bn in duties since they were first imposed by the US in October 2019, according the EC.
The US imposed charges on goods upto $7.5bn in response to a World Trade Organisation ruling that judged the EU’s support of Airbus, its biggest aircraft manufacturer, unlawful. A year later in November 2020, the EU hit back. The WTO found the US had violated trade rules in its favourable treatment of Boeing, and was hit with EU duties worth $4bn.
In all the tariffs affected $11.5bn worth of goods, including French cheese, Scotch whisky, aircraft and machinery in Europe, and sugarcane products, handbags and tobacco in America. Procurement leaders on both sides of the fence were forced to wrestle with tariffs of 15% on aircraft and components, and 25% on non-aircraft related products.
Boeing-Airbus dispute by the numbers
- The dispute began in 2004
- Tariffs suspended for 5 years
- $11.5bn worth of goods affected by tariffs
- $3.3bn in duties paid by businesses to date
- 15% levy on aircraft and 25% on non-aircraft goods suspended
Both sides welcome end to tariffs
European Commission President Ursula von der Leyen branded the truce a “major step” in ending what is the longest running dispute in WTO history. It began in 2004.
“I am happy to see that after intensive work between the European Commission and the US administration, our transatlantic partnership is on its way to reaching cruising speed. This shows the new spirit of cooperation between the EU and the US and that we can solve the other issues to our mutual benefit,” she added.
Both aircraft manufacturers have welcomed the news. Airbus said in a statement that it will hopefully bring to an end the “lose-lose tariffs” that are affecting industries already facing “many challenges”. Boeing added that it will “fully support the U.S. Government’s efforts to ensure that the principles in this understanding are respected”.
The US aerospace firm added: "The understanding reached today commits the EU to addressing launch aid, and leaves in place the necessary rules to ensure that the EU and United States live up to that commitment, without requiring further WTO action."
This week’s decision expands upon a short-term tariff truce announced in March this year. The EC says it will work closely with the US to try and further resolve the dispute, establishing a Working Group on Large Civil Aircraft led by each side’s trade minister.
Airbus last month signalled to suppliers that post-pandemic recovery was on the horizon, telling them to scale up to meet a return to pre-COVID manufacturing levels. “The aviation sector is beginning to recover from the COVID-19 crisis,” said Airbus chief executive Guillaume Faury, adding that suppliers should prepare for a period of intensive production “when market conditions call for it.”