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A Holistic View of Supply Chain Risk

By Steve Geary | 06/04/2018 | 4:20 PM

Allianz – an international insurance firm headquartered in Europe – publishes an annual “Risk Barometer.” 

According to the report, globally, “Business interruption ranks as the most important global risk for the sixth year in a row (42% of responses), due to its tremendous effect on revenues.”

Drilling down into the Americas specifically, in 2018, the top 10 risks identified in the Americas region are:

  1. Cyber Incidents
  2. Business Interruption
  3. Natural Catastrophes
  4. Market Developments
  5. Fire and Explosion
  6. Changes in Legislation and Regulation
  7. Loss of Reputation and Brand Value
  8. New Technologies
  9. Climate Change and Weather Volatility
  10. Talent Shortage

It’s a good list, and Supply Chain Risk Management weaves through all of it.  Logisticians ship, receive, and store things all over the world, so supply chain leaders have to worry about taking a hit in any one of these dimensions.  At the moment, we’re all riding the uncertainty on the domestic regulatory dimension, while chatter about a trade war looms on the horizon. 

The immediate tends to occupy our attention.  That’s natural. The academics call it selection bias.  We focus on what’s in front of us, and have a tougher time thinking about what might be around the corner.

But hurricane season has officially started, unemployment is under 4% so key positions go unfilled, block chain is disrupting traditional business networks, volcanos are being disagreeable in Hawaii, and the FBI is telling us to reboot our servers because of some insidious Russian virus.  And that’s just off the top of my head.  Take a moment and make a list of the “significant” supply chain management risks for your business.

Take a look at your operation through this holistic lens.  Where are your vulnerabilities?  What are your countermeasures?  Do you have a plan?  Are you even capable of executing the plans you have?

Be honest about it, be a little bit intimidated, and then get to work.

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About Steve Geary

Steve Geary

Steve Geary is an adjunct faculty member at the University of Tennessee's College of Business Administration, and is on the faculty at The Gordon Institute at Tufts University, where he teaches supply chain management. He is the President of the Supply Chain Visions family of companies, and Chief Operating Officer at ROSE Solutions, consultancies that work across the government sector. Steve is a contributing editor at DC Velocity, and editor-at-large for CSCMP's Supply Chain Quarterly. He is listed in Who's Who in America, Who's Who in the World, Who's Who in Science and Engineering, and Who's Who in Executives and Professionals. In November of 2007, Steve was recognized for "Selfless Service to Our Nation and the People of Iraq" by the Deputy Secretary of Defense.



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