Question

Essay Question:

Discuss Supply Chain Risks and their mitigation. At what frequency do you suggest buyers, managers, and executives in the supply chain to review risks and mitigation plans. Who among them should focus the most on Strategic risk?, Tactical risk?, Supply Risk?

Answer 1

Below are the supply chain risks and the ways to mitigate them -

1. Evaluate and Identify Current Risks. Take a critical look at your business and identify areas with risk exposure. Identify and evaluate potential supply chain disruption scenarios.

2. Prioritize by Probability and Impact. Covering every scenario is impossible, so prioritize potential risks by the likelihood they could actually take place. Then estimate the financial and brand impact of each event. Develop mitigation contingency plans, starting with the most likely and highest-impact risk scenarios.

3. Ensure Supplier Quality. Suppliers can impact your company’s reputation. In addition to ensuring the quality of suppliers’ goods, be aware of how they treat employees, source materials and interact with other partners. Conduct financial due diligence to ensure long-term supplier viability.

4. Diversify Suppliers. Don’t rely on one source for materials or products. It’s desirable to source from low-cost locations around the world, but if goods can’t be delivered in a timely manner, your supply chain becomes vulnerable. Establish reliable secondary suppliers in different regions to minimize this risk.

5. Be Aware of Suppliers’ Risks. Be aware of risks your suppliers may face, including regulations compliance, country risk, economic and political conditions or anything that may impact their ability to serve you.

6. Include Partners in Risk Planning. Work with suppliers, transportation carriers, data management centers and customers to ensure they have disaster recovery and business continuity plans that align with yours. Involving them in risk management planning reinforces their importance as a partner and elevates their role in risk mitigation.

The Health and Safety Executive (HSE) says risk should be assessed "every time there are new machines, substances and procedures, which could lead to new hazards." An employer should carry out a risk assessment: whenever a new job brings in significant new hazards. There are others who suggest that Companies should review their risk assessments and risk management practices once every 3 years or whenever there are significant changes to workplace processes or design or whenever new machinery, substances or procedures are introduced or whenever there is an injury or incident as a result of hazard exposure.