Sure, it’s essential to have contracts with your customers to set the ground rules.

But why would you need contracts between co-workers?

Because it’s spring and love is in the air.

And the best way to keep your company from getting tangled in lawsuits that often run into six figures (and more) to settle is set specific ground rules and require both parties to sign off on it.

A survey last fall revealed that 40% of employees said they’d dated a co-worker at some point during their career. One in four of these employees kept the relationship under wraps.

It’s a given that most companies won’t allow one employee to supervise the romantically connected partner — but it still frequently happens.

But there are serious threats that can undermine the way your business operates.

• What happen if a couple breaks up and it turns ugly?
• What if one of the romantic pair takes up with another employee?
• What if a spurned employee decides to file a harassment lawsuit, or accuses someone of demanding sexual favors?

That’s why “Love Contracts” are gaining in popularity.

It doesn’t have to be anything fancy.

Six rules:

1. No PDAs (public displays of affection)
2. No dating the boss (or someone who answers to you)
3. No gooey or raunchy e-mails using office technology
4. No talk by the water cooler about last night’s action
5. No “dressing for dates” — business attire is mandatory
6. No pouting or temper tantrums if there’s a less-than amicable parting

One problem: Many of the road signs along the way are now obscured, or difficult to understand.

That’s why now is a great time to take a step back and assess where you are and where you’re going.

The biggest influence to take into account: the role of IT in improving your supply chain performance.

But instead of IT spending, expect pressure to “make do and mend,” experts caution. You’ll be called upon to make the best use of what’s already in place. This means there’ll be little discretionary funding available, but you’ll still need to find some money (perhaps under the couch cushions!).

You’ll still be expected to squeeze a few pennies out of procurement, logistics and distribution functions.

One idea: You might switch over to a pay-per-use technology license, rather than an annual contract.

Three areas experts have targeted as ripe for change:

• Supply chain flow management. In response to pressure to improve lead-time indicators and supplier flexibility, you’ll be expected to work with tech vendors that offer detailed analysis and higher visibility of business functions.
• More efficient inventory management. More supply chain operators will be asking vendors to integrate their tools as part of operations, and might even begin purchasing software services from vendors.
• Production and distribution management. Supply chains will need to ramp up contingencies for a growing number of “what-if” scenarios, to be even better prepared to react quickly when conditions change.

That’s because companies need to take a big picture approach to procurement, focusing on more than just price. What’s more important, experts say, is the lowest cost to the organization.

For example, what’s the use of buying the cheapest widget if it has a higher breakage/fault rate than widgets available from other suppliers?

By the time you factor in how much the breakdowns cost you in production, in paperwork, in deductions — it might be worth paying a little more and get a higher-quality product in return.

Your internal costs could outweigh any advantage you think you’re seeing from making procurement decisions based solely on price.

For many supply chain managers, this can be an uphill battle.

First, there’s the pressure to go with the lowest unit price.

Then, there’s the effort and difficulty involved in demonstrating that the lowest unit price is actually increasing operational costs.

It can take a while to document the additional costs, while the purchase price of the “cheap” unit remains front and center.

Finally, there’s the expectations many companies put on procurement/purchasing people to manage costs, right down to the unit level. This means you’ll need time and evidence to make your case for spending a little more.

Remind other managers that this is a time when many organizations are cutting corners, in addition to trimming prices. Some of these companies are cutting so many corners they’re not likely to be around for much longer — which will leave you in a lurch.

Then, you might want to mention the recent (and costly) peanut product recalls, and the resulting bad publicity. Those companies thought they could buy at the best price … and you see what happened.

Fortunately, there’s an answer: Experts have laid out a three-step plan that can help keep you on target and out of the cross-hairs.

1. Stand behind the boss — without kicking him or her in the butt. You never, never want to criticize your boss to a co-worker. You have no control what’ll happen to that information after it leaves your lips. Once it gets back to the boss, it’s likely you’ll find yourself being pushed off the fast-track and into the junkyard. If you must criticize, frame it around yourself. “I’ll be in a much better position to nail this project and help our company if I had …”
2. Rise above the crowd — without trampling your co-workers. Develop your personal talents and look for opportunities to show your creativity. Sharpen your language skills, so your written communications make a positive impact (and don’t embarrass you). Demonstrate to your boss that you’re comfortable thinking “out of the box.”
3. Offer solutions — instead of simply pointing out problems. If you’re bringing a problem to the boss, have at least one solution prepared and tucked in your pocket. No boss likes having a whiner who only complains without offering hope.  This also demonstrates that you’re a solution-oriented employee, which can lead to a bigger payoff down the road.

But just because electronic transactions are becoming more commonplace, you still can’t afford to let down your guard for even one moment when it comes to protecting a customer’s confidential information.

To help determine if you’re on the right page in keeping data safe, there are five key questions you can ask yourself about transactions that occur with your customers.

These questions are both a diagnostic assessment and a wake-up call. They apply whether you’re simply considering upgrading your transaction capacity, or even if you’ve already made the commitment and you could use a guide to setting it up.

Five questions:

1. How likely is it that one of the parties involved in the transaction would try to use a false identity?
2. What would be the fallout if the transaction data got into the wrong hands?
3. How much pain would a security breach inflict?
4. What type of information could be accessed by unauthorized parties?
5. What would be the impact if information being sent to you by a customer or a vendor was intercepted?

Good news: Security experts recommend four basic guidelines for helping to prevent these security breaches.

• Pay close attention to updates and patches for your computer’s security system, and implement as soon as they become available.
• Ask your own IT expert(s) to check your system security, when it comes to your Web browser and e-mail software.
• Passwords are critical. Choose longer passwords that have nothing to do with your name, your company’s name, etc. And be sure to change passwords often.
• Audit monthly statement — from banks and credit card providers — more closely than ever. This is often the first indication for many Purchasing & Procurement pros that something is amiss.

With this front and center in your mind, watch out for these 7 deadly supply chain pitfalls:

• Build first, then wait for the orders to roll in. Do this and you’re liable to end up with a lot of product you can’t use. You know the money meter is ticking away each day product sits on your shelf and gathers dust. Solution: Analyze and monitor your ordering from outside suppliers.
• Too much down time. Staffers should move fluidly from one task to another, and outgoing shipments must be timed for maximum efficiency. For example, say your regular FedEx shipment goes out at 4 p.m. Yet there are almost always a couple of more orders that dribble in afterward. Those orders won’t go out until 4 tomorrow — unless you can adjust the timing of FedEx pickup.
• Efficient, uncluttered delivery routes. When was the last time you took a close look at your delivery patterns? Chances are, there’s been some change in suppliers and needs since then. Study where trucks are going now with an eye toward more efficient delivery, then tighten up those routes.
• No wasted motions. In addition to plotting the most efficient routes around the warehouse for putaway and picking orders, examine the ergonomics of each location. Are workers being asked to pick up too much from the floor? From higher than their head? Spend a few minutes each day observing how workers lift, tote and put down.
• Too much here, too little there. All too often, it’s a normal part of logistics shuffling: Early deliveries are stowed over there, orders going out soon but not yet are stashed here, inventory plopped into a temporary location, until the proper home opens. All of these cost you time and raise the risk of error, which can be even more costly. Clearly designate a place for everything, even temporary stops.
• Space, the final frontier. When you see the same warehouse configuration every day, it’s not unusual to start looking past areas that aren’t quite all that you hoped they could be. Some folks even develop what can be best described as a blind spot. What to watch for: too much open space; too much tight space; too much space on shelves; cartons that aren’t loaded to capacity; even outgoing shipments that aren’t packed to the rafters.
• Errors, plain and simple. Billing errors, incorrect shipments, broken or damaged goods or product, deductions, adjustments, mislabeled product and even simple inventory discrepancies and slip-ups. These all cost you, and will continue to be problems unless aggressively addressed and attacked.

Incredibly enough, there are plenty of folks out there who draw a blank if you ask them.

Here are four directions to set them on the right track:

Loyalty. Sure, it’s OK to ask the boss questions. But you really shouldn’t be bad-mouthing the boss or questioning his or her decisions while you’re hanging out at the water cooler. When times get tough, your boss needs your backing more than ever.

Tell me, tell me. No boss likes to be surprised, especially if the surprise is delivered by another manager: “Did you know one of your people …” It makes the boss looks like they’ve lost control over what’s going on in their own department. Also, if your boss learns of a problem in this fashion, it’s often too late to do too much about it.

Drop the finger-pointing. Bosses don’t want an earful of excuses. They want results, or at least progress. Share that information with them.

Think positive. Don’t be an Eeyore. Bosses need you to keep your attitude positive, at all times. If you’re upbeat and enthusiastic, it’ll rub off on co-workers — and make the job easier for the boss.

But proponents of taking procurement processes on line are quick to point out that in the long run, the savings from this investment can be significant.

As part of building your case to consider e-procurement, start selling its benefits to your suppliers.

There are three big selling points:

• When a supplier receives your purchase order automatically into its order management system, the supplier saves time and trims labor costs. No longer will people be forced to hand-enter information into the supplier’s ordering system, which will greatly reduce the incidence of errors.
• The increased accuracy that comes from no longer hand-keying information into the system will help make sure the suppliers’ customers get their orders more quickly.
• The final benefit is that because there is no longer a delay in getting orders into the supplier’s system, products will be delivered faster and the supplier will develop a reputation as being extremely responsive to customer needs.

Chances are, people at your company will want to know the estimated Return on Investment for automating procurement processes.

The best that experts can speculate is that a good e-procurement system will save 5% to 10% of your annual spend. Your own ROI will depend on your annual budget and the vendor you select for the e-procurement system.

So it only follows that the better you know how to set the table, the more success you’ll find at the financial trough.

Some experts say the best way to position yourself is to cultivate a working relationship with the “C people” at your company: the CFO, CEO, and/or CIO.

This way, you’re better prepared when opportunity knocks.

In order to capitalize on this seat at the table, consider following this five-step plan:

• Align your goals. The C people are more likely to consider your ideas if those ideas are in sync with their own goals for the company. Not sure what those goals are? Ask.
• Be a Boy Scout. Like the Scout mantra says, Be Prepared. That means don’t wait to pull together detailed information on suppliers, goals, etc. You never know when opportunity will knock.
• When in Rome … Be sure to present your ideas in their language: “For X investment, we will achieve Y return.”
• Get to the point quickly. You never know when your time with C people will be cut short. Get your ideas on the table quickly. Visuals — like a spreadsheet — can help.
• Lend a helping hand. Let the C people know you’re available for questions before they are asked to explain specific proposals. You can make sure the key points are easy to understand and convey.

But there’s also potential for a backlash hiding in your reserve of inactive vendors: Duplication of orders, and even fraud.

Good news: Reducing the risk of these isn’t as complicated as you might think. After all, it’s the fear of complexity that’s keeping many Purchasing & Procurement pros from purging their vendor rolls.

The final decision to keep or cut loose an inactive vendor of course lies within your own company, based on your unique standards.

But there are some general guidelines that can help you pave your own path.

For example, one benchmark for jettisoning inactive vendors generally occurs at 15 months; the most common standard is two years.

Here’s a guide to help your decision-making process:

• Gather the facts. Run an audit of your records. Identify vendors you haven’t used for a decided-upon period — say 14 or 15 months.
• Update the records. Sort your inactive vendors into more easily identifiable categories. Based on industry or individual needs, these categories can include: archiving the vendor’s records; removing the vendor’s name from your live master file; creating a designation for inactive vendors in your file, so they’re easily identified.
• Get everyone on board. Share your findings with the other key players in Purchasing & Procurement, and ask for their input. There might be reasons — not always obvious — why specific vendors need to remain in play, despite recent inactivity.