Reason Magazine 2014 Quartal 2 Seite 24

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supplier is reliable and whether the relation ship should continue Moving forward it becomes imperative that these two steps be integrated in the supplier selection process Risk mitigation alternatives Loss prevention and mitigation can then be applied to specific suppliers Exhibit 1 shows a range of strategies that can be implemented based on cost in terms of direct dollars spent and indirect time and resources and level of protection measured in terms of amount of disruption time covered Risk transfer alternative sourcing and inventory strategies address disruptions in a temporary manner in terms of prevent ing and mitigating loss of business income Risk transfer solutions can be more expen sive because they require a risk assessment in order to provide an appropriate level of business interruption coverage In any case none of these strategies addresses the last ing impact of loss of reputation market share or shareholder value Addressing those consequences requires some level of investment in vulnerable suppliers Given the levels of investment required the most effective and lasting means is partnering with the vulnerable supplier to help implement risk improvement activities to prevent or mitigate a loss Effective supply chain risk management must be holistic and integrated Some of the most sophisticated supply chain risk manage ment programs are integrated in the design and manufacture of a product or service and based on solid collaboration with critical sup pliers They also possess a great deal of agility to address supply chain disruptions A company with a strategic source planning process can concurrently deliver risk management a lean effective supply chain cost and value improvement speed to market and innovation That plan would address the two more effective ways of deal ing with supply chain risk collaborating with suppliers on their business continuity planning and protecting their facilities In the end the interconnectivity of our complex corporate world requires a new level of thinking as it relates to sup ply chain resiliency The key to resiliency is identifying suppliers regardless of tier that can cause the greatest interruption to rev enue streams as well as the greatest nega tive impact on reputation and market share Then address them with lasting long term investments The key to resiliency is identifying suppliers regardless of tier that can cause the greatest interruption to revenue streams as well as the greatest negative impact on reputation and market share Then address them with lasting long term investments 24 Reason ISSUE 2 2014 the IDEA Good Choice Click tap scroll pinch Now Reason content is available whenever you are on whatever device you happen to have at hand fmglobal com reason