Companies need to be realistic when it comes to the disaster preparedness of their supply chains. Natural disasters, factory explosions, labor disputes, power outages, chemical spills, geopolitical crises - these supply chain disruptions and continuity risks are not matters of if, but when and where. Once a disaster strikes, do you know what is going on at the part-level of your suppliers? Have you identified which activities and roles you need to concentrate on so your business can weather the storm?
Any effective supply chain resiliency program will include contingency plans that ensure production and product delivery continue - either uninterrupted or with minimal financial, competitive, or customer impact - in the event of a supply chain disruption. A developed supply chain business continuity plan fosters corporate mindfulness and prepares your business and network of supply chain partners to perform uninterrupted regardless of where and when a supply chain disruption event may occur.
Even though we're three months into 2016, it’s not too late to prepare your business for the supply chain disruptions that are bound to happen. As such, I provide 10 reasons why you should focus on Supplier Business Continuity Planning this year:
- Your organization may be required by government legislation or corporate governance to implement a form of Business Continuity Management into its policies.
- Insurance companies will view your company more favorably should a crisis require your company to summon their services.
- Supplier Business Continuity Planning gives upper management a better grasp of the minute details of the business’ suppliers and helps the organization identify supply chain vulnerabilities. It offers useful ways to improve organizational processes, even in areas that were previously unconsidered.
- Supplier BCP minimizes Time to Recovery (TTR) whilst fostering supply chain visibility.
- Supplier BCP can prepare smaller businesses from large-scale revenue loss from disruptions, disruption which larger enterprises may have been better suited to mitigate.
- Business Continuity Planning bolsters your business against large-scale problems affecting suppliers through detailed planning and helps eliminate smaller problems that may have caused continuity interruptions.
- A Business Continuity Plan shows your investors and stakeholders that you take your shared business’ continuity seriously, and that your organization is prepared and desires to maintain productivity regardless of setbacks.
- Your customers will appreciate that your organization has taken steps to ensure continuity to fulfill your commitments. Business Continuity Plans display your commitment to quality service and instill a confidence in your business.
- Business Continuity Plans help protect your company’s brand, image, and reputation.
- Most importantly, a thorough Supplier Business Continuity plan can significantly reduce your revenue losses in the event of a disaster.
Since disasters come in all shapes and forms, and each disaster has its unique cascade of impacts (see: Anna Karenina Principle), this requires companies to prioritize which parts of the business to keep running when a disaster hits. Since there are too many variables to plan a response for each potential disruption, supply chain business continuity plans are vital supply chain resiliency measures.
Resilinc provides a cost-effective and repeatable process for assessing supplier business continuity risk and recovery capabilities at the part level, and integrates that information into a comprehensive supplier risk evaluation and mitigation program. The solution leverages Resilinc’s existing network of “on-boarded” suppliers and information repository to facilitate supplier collaboration and data sharing. Analytics are then applied to drive supplier scorecards, revenue impact analysis, and risk mitigation strategies and tactics.