Reducing the Risk of Liability in Supply Chain

Supply chain professionals are capable of increasing global supply chain efficiency, but they can also increase the risk. Unfortunate calamities like earthquake, tsunami, typhoon, hurricane and other events may affect the supply chain. The Japanese earthquake recently demonstrated how a calamity would affect the production supply. The said earthquake drastically affected the global electronics production and the disruption in the automotive industry.

supply risks

 

Just like any other business, the nature of supply chain risk is constantly changing. The strategies you previously developed might become ineffective in solving the vulnerabilities or risk to your supply.

 

The global supply chain is fragile due to its emerging risks. Moreover, the integration of risk management in the supply chain has often limited companies and organizations that are more focused in reducing their expenses and gaining more profit. It has been a common practice for most companies to immerse their attention in developing strategies that bring out profit to them than dealing with a plan to reduce the risk of the global supply chain.

 

You might be asking, what should companies do to to develop a balance between financial efficiency and stable supply chain. The answer is, you should consider to look at the whole part of the supply chain and not just the certain parts. One of the common mistake of most companies is that they tend to focus on individual parts,  such as manufacturing, logistics, and production.

 

Review your organization’s risk protocol

Uncover what are the common risks or problems your company is facing. You can get this from each of the departments, study the list, and develop a new plan on how you can solve the problems. Failure to oversee such situation might affect the business continuity and supply chain integrity.

 

Review your ongoing operating models

This technique emphasizes an in-depth analysis of the risks that are embedded into a company’s operating model. This includes a detailed review of the supply chain risk inventory, identification of critical steps that might cause the failure of your company.

 

Use advanced skill procurement officers

Hire credible supply chain officers such as a Certified Professional in Supply Management because they can help you develop an advanced supply chain modeling strategies that can help you gauge the financial impact of your supply chain. They can also create credible risk monitoring reports.

 

If you want to become more proficient in supply chain management, you can join one of Jack Quinn Solutions 3-day CPSM Certification Training Boot Camp. Jack Quinn Solutions, LLC provides you with trainings and skill development for you to achieve a better career opportunity! We can train you and bring out the best in you.

Get more business and procurement tips at CPSM Training.