Executive Briefings

The Way You Prioritize Suppliers May Not Be Best Method for Mitigating Risk

The way suppliers are typically segmented may work well for prioritizing procurement resources on supplier selection, managing supplier performance, and supporting and developing strategic suppliers. But it doesn't always work well for prioritizing resources on risk management and compliance. Many B and C suppliers may be easily switched, but still represent large material risks to the company (such as litigation or regulatory fines).

The Way You Prioritize Suppliers May Not Be Best Method for Mitigating Risk

One answer to more effectively manage supplier risks is to segment the work into strategic vs. tactical risk management tasks, regardless of which tier the supplier falls in.

Tactical tasks can consume a tremendous portion of time for internal experts (e.g. procurement, commodity manager, safety, risk manager, compliance, quality, etc). By segmenting tasks, internal experts can focus most of their time and efforts on strategic tasks, while tactical and routine tasks are delegated to a third party who (if it is the right service provider) can perform these services much more cost-effectively.

Ideally this segmentation of tasks is implemented by a platform with a rules engine that can be configured using rules created by the company's end-user experts.

Read Full Article


Keywords: sourcing solutions, supply chain, supply chain management, supply chain risk management, supplier base, supplier analytics

One answer to more effectively manage supplier risks is to segment the work into strategic vs. tactical risk management tasks, regardless of which tier the supplier falls in.

Tactical tasks can consume a tremendous portion of time for internal experts (e.g. procurement, commodity manager, safety, risk manager, compliance, quality, etc). By segmenting tasks, internal experts can focus most of their time and efforts on strategic tasks, while tactical and routine tasks are delegated to a third party who (if it is the right service provider) can perform these services much more cost-effectively.

Ideally this segmentation of tasks is implemented by a platform with a rules engine that can be configured using rules created by the company's end-user experts.

Read Full Article


Keywords: sourcing solutions, supply chain, supply chain management, supply chain risk management, supplier base, supplier analytics

The Way You Prioritize Suppliers May Not Be Best Method for Mitigating Risk