74% of supply chain companies have experienced supply chain disruption at least once, based on a recent Business Continuity Institute study. A similar number of respondents (72%) admitted to not having full visibility of their supply chain. Lou Feretti, Project Executive at IBM, and Pierre Mitchell, Chief Research Officer at Spend Matters, discussed supply chain risk in a webcast on 5/4. The two pointed out the challenges and complexities of supply chain risk, and how to overcome them. One issue that was frequently brought up was the visibility within the supply chain.
70% of Chief Supply Chain Officers identified supply chain visibility as a major concern of risk. The above graph makes it clear that visibility is what leaders struggle with most in handling risk. Despite this fact, visibility is critical, based on the above 4 steps for responding to risk. By uncovering events earlier, companies are better able to assess the situation and their options. This will allow them to better mitigate any negative consequences of a major event. Through analytic tools, careful prediction, and close monitoring of the supply chain, visibility can improve. Full visibility can be difficult to accomplish, but it leads to greater response time and more effective responses.
Visibility is the largest issue related to risk, but the benefits of gaining visibility are innumerable. Consider hiring a team dedicated to supply chain risk management. An effective team will be experienced in adverse events and will have the knowledge to identify different types of risks and their impact. The team can develop and refine models for identifying and responding to risk, as well as use analytic tools to make accurate predictions. Having a team that is dedicated to risk management will ensure visibility and fast response.
"MEP has put together an intelligent program that was well thought out and challenging for supply chain management team. They challenged our supply chain approach and current paradigm – forcing us to take a fresh look at what we do and how we do it. We are using the supply chain strategy tools that they provided as “take-aways” to change how we do things."
-Bruce Broxterman, President, Richards Industries