Every once in while I come across articles written by leaders in the industry. that catch my attention. Robert J. Schneider is Managing Principal of Risk Management over at ISO, and in a recent article in Industry Week, he shares his reflections on supply chain risk management. As he sees it, effective supply chain risk management in the manufacturing organization goes beyond traditionally insured risks such as tangible assets and related liabilities; rather, it focuses on the assets as part of a process.

Supply Chain Management must cooperate with Risk Management

Supply chain trends such as offshore manufacturing, global outsourcing and lean sourcing continue to impact the supply chain. In fact, supply chain risk management has taken center stage as a vital risk management priority.

Schneider advocates that risk managers and supply chain mangers need to work together very closely:

To keep pace with the dynamic changes taking place both inside and outside the manufacturing organization, risk managers — in cooperation with senior management — must embed risk management practices into all mission-critical points along the supply chain.

There’s an excellent piece on risk and procurement in the ISO Review, written by Ken Rado and Bob Schneider.

Build integral knowledge

Risk managers need to get to know the supply chain as well as (or maybe even better than) the supply chain manager does:

Risk managers must place themselves at the heart of the supply chain process by taking the time and effort to become intimately familiar with all the components that drive this critical business process. As a result, risk managers can influence risk decisions made within individual functional areas of the supply chain and guide decisions on which subsequent risk mitigation steps to take.

Think risk

Current supply chain trends such as offshore manufacturing, global outsourcing and lean sourcing do impact not only the supply chain, but the business as a whole, since so much of the company’s existences hinges on the supply chain, and thus:

The ultimate goal of an effective and comprehensive supply chain risk management strategy is to embed risk awareness into all the core elements of the organization.

Business can be outsourced, but risk can not.

Links

• Industry Week – Supply Chain Risk Management

Related

• husdal.com: Can you outsource risk?