• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Risk Management Remains an Untapped Resource in Procurement
ANALYSIS

Risk Management Remains an Untapped Resource in Procurement

February 1, 2021
Nathanael Vlachos, SCB Contributor

When it comes to supplier risk management, many procurement teams are lagging. In fact, fewer than half are responsible for executing operations related to third-party risk management, according to consulting company APQC. What’s more, nearly 50% of organizations don’t have disruption contingency plans from the majority of their suppliers.

Meanwhile, just 7% of organizations require concrete contingency plans — like alternate locations and their activation timelines — from 90% or more of their suppliers.

Procurement teams need to have a comprehensive view of the risks that could potentially disrupt any and all sourcing. Given the ever-growing myriad of moving supply-chain parts to account for, procurement teams need the right technology to continuously monitor risk factors in these areas. Such capabilities are critical to anticipating and quickly responding to disruptions. 

Unfortunately, about a third of organizations (30%) don’t have electronic systems to track suppliers’ risk profiles. Another third (33%) do have systems, but these systems don’t provide information on the potential impact of disruptions to the supply chain. This gap can leave organizations vulnerable and slower to react to unforeseen events. For example, one out of every five organizations told APQC that they take a month or longer to identify impacted materials, sites, commodities or products when a supply-chain disruption occurs. 

Agricultural equipment manufacturer AGCO Corp. is an example of an organization that leverages risk technology to enable lightning-fast responses to disruption. The organization’s risk notification system creates a visual map of suppliers down to the third tier and sends notifications in the event of impending disruptions like supplier bankruptcy. Using this tool, AGCO was able to accurately predict when countries would be shutting down due to COVID-19, and then accelerate shipments out of those countries before borders closed — minimizing disruption to the company’s supply chain and customers.

Outlook

Third-party risk management and continuous risk monitoring are both core facets of supply-chain management that drive security, resiliency and competitive advantage. Organizations that make a robust effort in these areas will be better prepared for whatever disruptions come next.

Nathanael Vlachos is a writer at APQC.

    RELATED CONTENT

    RELATED VIDEOS

    Sourcing/Procurement/SRM Technology Supply Chain Security & Risk Mgmt
    Nathanael Vlachos, SCB Contributor

    Don’t Chicken Out in Your Supply Chain

    More from this author

    Subscribe to our Daily Newsletter!

    Timely, incisive articles delivered directly to your inbox.

    Popular Stories

    • A YELLOW CORP TRAILER IS BEING TRANSPORTED BY A FREIGHT TRAIN.

      Yellow Considering Offer to Revive Company, Rehire Thousands

      Global Logistics
    • A ROW OF MEDICAL DEVICES IN A WAREHOUSE

      Hospitals Face Mounting Shortages of Essential Medical Supplies

      Data Management (Big Data/IoT/Blockchain)
    • AMAZON TRUCK ON HIGHWAY

      Amazon is Now the Biggest Delivery Business in the U.S.

      Last Mile Delivery
    • GROUND VIEW OF THE SHANGHAI CITY SKYLINE BENEATH A BLUE SKY.

      China’s Slowing Economy Is Putting a Damper on Its Plans for Global Dominance

      Sourcing/Procurement/SRM
    • SHIPS SAIL THROUGH THE SUEZ CANAL

      The Panama Canal Is So Backed Up Ships Are Rerouting Through the Suez

      Ocean Transportation

    Digital Edition

    Scb nov 2023 lg

    2023 Supply Chain Innovation Award

    VIEW THE LATEST ISSUE

    Case Studies

    • A GRAPHIC SHOWING MULTIPLE FORMS OF SHIPPING, WITH A HUMAN STANDING AT THE CENTER, TOUCHING A SYMBOLIC MAP OF THE WORLD

      Enhancing High-Value Electronics Shipment Security with Tive's Real-Time Tracking

    • A GRAPHIC OF INTERLACING HONEYCOMBED ELEMENTS REPRESENTING GLOBAL BUSINESS TRANSACTIONS

      Moving Robots Site-to-Site

    • JLL Finds Perfect Warehouse Location, Leading to $15M Grant for Startup

    • Robots Speed Fulfillment to Help Apparel Company Scale for Growth

    • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

    Visit Our Sponsors

    Antuit Zebra Anvyl AutoStore
    BEUMER Group Blue Ridge Global Brightdrop
    Brother CHEP Cleo
    Coenterprise Comarch Data Capture
    E2open Enveyo Eva Air
    ForwardX Robotics Frayt GAINSystems
    Generix Geodis GEP
    Global Supply Chain Marketing Summit GreyOrange Here
    HICX Holman Logistics Infor
    Inmar Kinaxis Lexis Nexis
    Locus Robotics Logility LogistiVIEW
    Lucas Systems MCA Connect MCA Connect
    Moody’s Analytics MPO Old Dominion
    OneRail Overhaul PartnerLinQ (Visionet)
    Port of Virginia Rockwell Automation Ryder E-commerce by Whiplash
    Saddle Creek Logistics SAP Servicon
    Shyft Sourcemap SPS Commerce
    Tecsys TGW Systems Thomson Reuters
    Veho Verusen Walmart
    Workshop
    • More From SCB
      • Featured Content
      • Video Library
      • Think Tank Blog
      • SupplyChainBrain Podcast
      • Whitepapers
      • On-Demand Webinars
      • Upcoming Webinars
    • Digital Offerings
      • Digital Issue
      • Subscribe
      • Manage Your Subscription
      • Newsletters
    • Resources
      • Events Calendar
      • SCB's Great Supply Chain Partners
      • Supplier Directory
      • Case Study Showcase
      • Supply Chain Innovation Awards
      • 100 Great Partners Form
    • SCB Corporate
      • Advertise on SCB.COM
      • About Us
      • Privacy Policy
      • Contact Us
      • Data Sharing Opt-Out

    All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

    Design, CMS, Hosting & Web Development :: ePublishing