By Sascha Sinclair, Systematic Marketing Manager
In the current political and financial climate, Australians are looking to see a real return on investment being made on major projects by all levels of government.
There is also strong support for local manufacturing to build long-term supply chain resilience by developing and maintaining sovereign capabilities and thereby strengthening the ability to deliver locally. Australia must seek to diversify its industrial capacity in order to deal with uncertainty in the global supply chain.
A company Australian Industry Content (ICA) or Development of local industry (LID) will become a key element when governments seek to make investment decisions in all future projects.
Organizations that focus on winning defense, rail, or other major government-related work will need AIC and LID to be part of their strategic planning.
Supporting the development of local industry will need to become part of an organisation’s ‘DNA’ as it shapes decision-making across the business. It will no longer be acceptable to pay ‘lip service’ for the AIC or LID component of an offer or tender – a commitment to this will need to be demonstrated for companies to be competitive.
AIC or LID plans in a business strategy
Paul Gibbs is Systematiq’s regional manager for Queensland and an AIC/LID specialist, who has 25 years’ experience in the defense and rail environment and five years in a leadership role in a global logistics organization.
“The reality is that the Australian public expects to see real and meaningful commitments from organizations to ensure that a particular project is on time and on budget, but also as promised in relation to opportunities for development. employment, local supply chain expenditures, commitments to veterans, disadvantaged people, Indigenous communities, investments in education and sovereign capacity development,” Mr. Gibbs said.
“In fact, we are already seeing tenders requiring large percentages of expenditure on AIC/LID plans and they are now at the heart of the decision-making process.”
Part of an AIC or LID plan includes the inclusion of a social sourcing strategy that demonstrates how a company will support local industries, Indigenous and Torres Strait Islander (ATSI) peoples, and disadvantaged community groups.
This is designed to optimize opportunities for local suppliers and governments, ensuring that government contracts support local, regional, state and Australian businesses, industries and jobs.
An AIC or LID plan should not be adopted as a result of a call for tenders, but should be integrated into a business strategy in order to win business that will benefit the local community.
“In order to deliver a successful AIC/LID strategy that enjoys full organizational buy-in, you must tie it to a business imperative that gives a compelling reason why the business should invest time, energy, and funds” , Mr. Gibbs said. .
In fact, in most states, local industry involvement and social procurement have been considered in the planning and development phases of major new infrastructure projects.
This is designed to generate value beyond the value of the purchased goods, services or construction. Benefits accrue to all when social and sustainable outcomes are achieved, both directly and indirectly.
A tender response will be evaluated on where and how the applicant will invest to fulfill a contract. It gets quite granular in the level of detail required, for example, providing information such as number of interns, gender breakdown, number of Indigenous employees, or number of people with disabilities.
Systematiq provides strategy and expert advice
There is a huge opportunity for smaller companies to participate and partner with larger organizations and prime contractors by becoming supply chain partners on large defense or long-term infrastructure projects. term.
Systematiq works with large and small businesses to provide these requirements and ensure they submit compliant and locally targeted responses. Systematiq also provides research and assessments so businesses can prepare ahead of time.
Mr. Gibbs has worked with organizations to provide very detailed plans as well as broader strategic recommendations that take into account the business side of a tender response.
“Our approach is to look at the big picture for a client when providing these plans.
“Through the AIC and LID-related work done for our clients, Systematiq operates as a ‘think tank’, where we have been able to tap into various resources within our network to bring our expertise to various areas of development. of each component – whether developing a model, responding to specific requirements, queries and questions,” said Gibbs.
This sponsored editorial is brought to you by Systematiq. For more information, visit www.systematiq.com.au.