Zurich produces healthcheck to assess risk
The number of companies that have had supply chain disruptions has doubled in the past five years, a Zurich survey reveals.
The report, called The Strategic Risk Manager, also says the number of countries to have suffered supply chain problems has risen by a third.
Zurich has produced a supply chain healthcheck for companies to assess risk. Among the important issues for business are knowing their critical suppliers, having routine systems to measure the suppliers’ financial stability and providing risk training to supply chain management teams.
Zurich’s Nick Wildgoose, the report’s editor, said: “As global markets have become increasingly competitive, many businesses have introduced cost-saving supply chain strategies to maintain profit margins, including sole sourcing and just-in-time deliveries of critical resources and components. With many organisations worldwide facing a major economic slump, some of these earlier savings are becoming operational weak links, especially in extended supply chains.”
Wildgoose added: “With due diligence, risk managers can influence decisions made within individual functional areas responsible for different elements of the supply chain.”
The increased risks facing businesses’ supply chains include suppliers going into receivership.
Problems in the supply chain can also damage reputation with customers, investors and policy-makers, says the report.