Risk management in supply chain

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Broad guidelines on SC risk management

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Risk management in supply chain

  1. 1. Risk Management in Supply Chain<br />
  2. 2. Identification and Assessment of Risk<br /><ul><li>Assemble a cross functional team of risk experts
  3. 3. Convene the cross functional team for brainstorming to identify and Map a portfolio of enterprise risks- Financial,Strategic,Operations,Hazards risks.
  4. 4. Filter, Assess and Prioritize Risks- relevant to mfg and supply chain and then map them according to probability of occurrence and loss severity(How difficult and costly each risk is to mitigate)
  5. 5. List down all the Top 10 risks
  6. 6. Begin to work on Actionable risks and integrate learning's into business processes.</li></li></ul><li>Identification and Assessment of Risk<br />
  7. 7. Identification and Assessment of Risk<br />High<br />Severity<br />Low<br />High<br />Low<br />Prob of Occurrence<br />
  8. 8. Measurement of Risk IN Supply Chain<br /><ul><li>Risk is a function of Probability of disruption multiplied by revenue impact </li></li></ul><li>Measurement of Risk IN Supply Chain<br />
  9. 9. Risk Amplifiers in Supply Chain<br /><ul><li>Instability of supplier’s environment
  10. 10. Length of lead time
  11. 11. Concentration or clustering of suppliers
  12. 12. Scarcity of qualified labor
  13. 13. Instability of work force
  14. 14. Degree of custom regulations
  15. 15. Level of security requirements
  16. 16. Level of demand for product(volume and variability)
  17. 17. Legislative policies for the import and export
  18. 18. Poor communication
  19. 19. Political instability
  20. 20. Number of transfer points
  21. 21. Lack of vessel capacity and channel overload
  22. 22. Strain on poor infrastructure
  23. 23. Terrorism
  24. 24. Natural disasters
  25. 25. Lack of visibility in entire supply chain
  26. 26. Technology limitations
  27. 27. Limitations on no of suppliers
  28. 28. Stringent quality requirements
  29. 29. Uniqueness of the sourced parts</li></li></ul><li>Risk Management Matrix in Organization<br />
  30. 30. Impact of Disruption in Supply Chain<br />DT- Discovery Time<br />RT- Recovery Time<br />RT<br />DT<br />Impact<br />DT<br />RT<br />Disruption<br />A Event<br />B Event<br />Time<br />
  31. 31. Thanks!<br />

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