Supply Chain Visibility – New Paper Looks Beyond the First Tier

We have a new briefing paper available to download now. It is titled “ Supply Chain Risk – Getting To Grips With n-Tier Visibility”. It was sponsored by riskmethods, but as always with our papers, it was written independently by us and in no sense is a sales pitch for anyone or anything really (other than good procurement practice – we always want to “sell” or promote that!)  You can get it here, free on download.

Not surprisingly, it looks at risk in the supply chain (or supply network), but with a focus on going beyond the first tier of direct suppliers. Many organisations focus some sort of risk management effort onto those suppliers, but far fewer have a structured programme in place to consider their suppliers’’ suppliers.

Yet the risks and issues that negatively affect firms can just as easily come from those “n-tier” organisations. For instance, even if you have multiple first-tier suppliers in place to provide a critical item, reducing supply interruption risk, then it may be that all of those businesses buy a critical component or raw material from the same second-tier supplier, who might be in danger of going bust. Or all the second-tier providers of a “product” might come from the same area and be susceptible to natural disasters (just as an example).

Indeed, it may not even be an item purchased that causes the problem in the supply network. It could be some critical technology, or it may be that all of a particular product ships through the same port. What happens if there is a labour dispute affecting that shipping location? Our paper contains some short case studies, and actually both the technology and the shipping issues get mentioned there.

So buyers and their organisations need to consider what sort of visibility they need to manage these risks better. But it isn’t always easy, and in the paper we look at both why that is the case and what levers can be used to gain better insight and information about those wider networks. First-tier suppliers can for example be great allies in gaining more visibility, but they may feel nervous for a number of reasons about exposing their own supply chains to scrutiny. Or they may simply not have good information themselves about suppliers to share!

Anyway, do download the paper now. It is short (a ten-minute read) but filled with useful ideas and tips for improving your supply chain risk management efforts.

We also still have available the webinar with riskmethods and client Acsuhnet that you can listen to here. Acushnet is the parent company of Titleist, and in the webinar, Jay Traficante, Sr. Director of Supply Chain and Procurement at Acushnet, talks about their risk management programme. Peter Smith also adds his views and there is an interesting Q & A session too.

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