Supply chain professionals from very large to very small companies face a wide range of risks that never make the headlines. Indeed, the Japanese tsunami and earthquake riveted the world a few years ago, but in the meantime, supply chain professionals have to deal with the unexpected day-to-day challenges that have just as much impact when taken as a whole on an organization. Supply chain experts at UPS Capital, who specialize in risk mitigation, divide supply chain vulnerabilities into two categories of risk. There are day-to-day risks provoked by the normal challenges of doing business including:
• Customer demand changes
• Unexpected transit delays
• Problems at suppliers, which delay critically needed components
• Theft, a much larger problem than most realize
• Production problems
• Warehouse shortages that cause serious delays in customer shipments.
• Cyber security
And there are the disruptions when “all hell breaks loose.” These usually cannot be predicted—epidemics, tsunamis, terrorism—but companies should be prepared with a risk management strategies to mitigate and minimize the impact of such risks.
a. Describe your strategies to mitigate such risks
