While familiarity purportedly breeds contempt, it certainly doesn’t lead to procurement fraud

piblogger:

Editor’s Note: How do close working relationships with suppliers create opportunities for procurement fraud?

Originally posted on Relational Contracting Intelligence Blog:

I read with great interest Colin Cram’s recent post regarding both the prevalence and significant impact that fraud within the procurement process has beyond the original transaction itself.

While the Cram article focuses on how fraud and corruption are badly damaging the economies of many African countries, there is no doubt that its overall effect from a global perspective are also significant. In essence, and to varying degrees, no country is immune in terms of vulnerability to fraud – Canada included.

Before I get into the specifics regarding the origins of the fraud problem, and how to effectively deal with it, we have to address a long standing myth.

The Myth of Familiarity

Many organizations – especially those within the public sector – equate the familiarity of building a close working relationship with supply partners with somehow undermining the integrity of the procurement process. In short, and in a…

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