Aravo's Tim Albinson Chimes in on Supply Risk

Even though Aravo is better known for the broad challenge of supplier information management -- not to mention supplier enablement and sustainability -- Tim Albinson recently weighed in on supply risk over on his blog. Referencing research in an article from Inside Supply Management , Tim quotes four tips to mitigate supply risk. First on the list is using "external financial or accounting firms to help you gather detailed financial supplier data" and then developing appropriate strategies. Next, on the list in the importance of "sangen-shugi (actual place, actual product, actual situation)" which roughly translates to not being a stranger when it comes to getting to know your suppliers -- and visiting them onsite. Perhaps the most important factor on the list is one I always recommend that companies use to monitor supply risk. To wit, this is the importance of being "on the lookout for supplier delivery and quality data that may signal broader instability and mismanagement issues." In my view, this last point is especially critical in global sourcing situations where a company -- even the largest customer of a supplier -- may never get a chance to see the actual books (or if they do, it's a second-set specifically designed to appease customers asking for the information).

Jason Busch

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