Risky Supply Chains: A Practitioner's View

Supply Chain Management Review has been hitting the mark of late with great Spend Management coverage. Their BCG-bylined feature article last month on Surviving the China Riptide was one of the best pieces I've ever looked at on the risks and opportunity of doing business in China. The good news is that the publication appears to be continuing their focus on supply risk. This month, Mark Crone, Director of Supply Chain Planning and Analysis for Limited Brands, offers an insightful take on the threat of supply risk today. In the piece, Crone describes how a steady rise in port traffic, increased domestic transportation strains, and escalating oil prices are increasing the risk and exposure of sourcing globally. He also examines terror, cost and other related risks that global sourcing efforts magnify. What are some of Crone's recommendations? A "far-reaching option may be to rethink the wisdom of global sourcing entirely. This is an extreme method of reducing transport risk. But the reality is that from a total profitability perspective, sourcing certain items overseas may be less appealing once all costs and risks are considered."

If you follow supply risk, this piece should fall in the "must-read" category. And kudos to Mark Crone for taking the time to share his thoughts -- there's nothing like getting an expert practitioner's perspective on a critical Spend Management subject. While there's a ton of consultants, analysts, journalists, and bloggers with useful things to say about supply risk, when the actual person whose job is on the line if a container does not arrive wants to chime in, it's worth paying extra attention. And Crone delivers in spades.

Jason Busch

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