An article in the Wall Street Journal on March 29, 2011 underscores even the largest of companies, like Apple, can experience challenges with their Supply Chain. With recent world events the risk a company can experience from their supply chain is firmly in focus. Having a resilient supply chain, which ultimately leads to a lower Total Cost of Risk (TCoR), is something the biggest and smallest of companies need to consider.
Adopting the use of a risk register process to methodically go through the vulnerabilities in your supply chain, will allow company leadership a more structured and consistent approach to evaluate suggested changes. The “inherent risk” (untreated) verses the “residual risk” (after mitigation) usually can clearly illustrate the return on investment for changes that are being suggested. Reducing potential financial impact by a thoughtful risk analysis is an exercise that most companies should consider.
If you would like to discuss how adopting a risk register process can help provide transparency to your company’s supply chain do not hesitate to contact me.
If you would like to read the full article on Supply Chain Risk Click HERE.
