Hurricanes, Geopolitics, Cyberattacks and More: Top Risk Posts of 2017

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As far as risk goes, if 2016 was characterized by political turbulence, then 2017 was all about disasters, natural and manmade. (We’ll let the question of whether there’s really a distinction there slide).

This past May saw a worldwide ransomware attack that hit more than 300,000 computers in 150 countries, disrupted hospitals and manufacturing plants, and caused economic losses that are estimated to be in the billions. Then there were the Harvey and Irma hurricanes of late summer and the ongoing California wildfires. And we haven’t even mentioned geopolitics, commodities, finances and all of the other risks out there that need to be on procurement’s radar these days.

As part of Spend Matters’ year in review, here are the top risk posts from 2017 that you don’t want to miss.

Spotlight on Mexico

President Trump withdrew the U.S. from the Trans-Pacific Partnership (TPP) back in January, and withdrawal from the North American Free Trade Agreement (NAFTA) remains a possibility. In 3 Reasons Why Procurement Needs to Worry About Mexico, Nick Heinzmann explained why the risks of sourcing and managing suppliers from Mexico are on the rise following the TPP move.

Yet another risk appeared a few weeks later. Taras Berezowsky examined the Mexican government’s February decision to deregulate its fuel market prices in A Major Price Risk Just Surfaced in Mexico: Why Unilever, Other Procurement Orgs Are Taking Note. Berezowsky chatted with Heather Mueller, vice president at Breakthrough Fuel, on what this fuel price liberalization will mean for procurement and supply chain organizations.

Cyber (In)security

The murder charge was dropped, but we won’t (and shouldn’t) look at an Amazon Echo in the same way again.

For the sake of brevity and leaving out the lurid details, a murder case received particular media attention this year when prosecutors believed that an Amazon Echo contained evidence of the murder. Then there was the (comparatively less serious) news that your smart vacuum may have been sucking up intel on your home along with the dust, collecting valuable data that could then be sold.

For procurement, digital technologies are a boon, as well as essential for keeping pace with our peers nowadays, but they can also expose companies to more risks. This year, Spend Matters covered companies’ preparedness (or lack thereof) for Internet of Things risks and supply chain resilience in the face of cyberattacks and new regulations.

In the Aftermath of Harvey and Irma

According to estimates from Moody’s, the economic damage wreaked by hurricanes Harvey and Irma has exceeded $150 billion. The oil and gas industry has been hit particularly hard, with Harvey shutting down oil refineries in Texas and closing key ports. In the weeks following these events, Spend Matters editors spoke with various experts on risk management and published a number of posts on supply chain risk mitigation in the near and long term:

Risk Strategizing: Do’s and Don'ts

Recent research shows that a majority of managers do not have enough visibility into their supply chains and that a majority has also faced disruptions in the past year. A significant percentage of these disruptions occurred in Tier 1 suppliers, causing considerable financial loss.

In Supply Chain and Procurement: Risk Management Strategy, GEP’s Maria Cecília Siqueira tackles a number of common mistakes that can obstruct a successful risk management program and explains how these missteps — such as not involving key players or having a superficial approach to priorities — can be avoided. 

One Report to Rule Them All

Last but not least, Spend Matters analysts Jason Busch, Pierre Mitchell and Michael Lamoureux teamed up earlier this year on the Supply Risk Management and Compliance Landscape Definition and Overview.

If you missed it, this comprehensive report discusses the different components of the supply risk management market from a customer perspective and then provides vendor shortlists for each area — supplier risk management, spend analytics, commodity risk, you name it.

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