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5 ways to address supply chain risk

Supply chain risk comes in many shapes and forms. Is your company ready to meet it head-on?

By ·

There are many faces of supply chain risk in today’s global business environment, where anything from a natural disaster to supplier insolvency to geopolitical turmoil can temporarily or permanently disrupt the manufacturing and/or transport of goods. Add quality and safety challenges, regulatory and environmental compliance, and even economic changes like fluctuating exchange rates to the list, and it’s easy to see why risk should be a top-of-mind issue for supply chain managers.

While some supply chain disruptions are identified and addressed quickly and without much fanfare, others receive national attention. In April, for example, Toyota, Honda, Sony and other major firms encountered supply disruptions in the aftermath of multiple earthquakes in Japan.

“The earthquakes on Thursday and Saturday, which killed at least 41 people, reflected the vulnerability of Japanese companies to supply chain disruptions caused by natural disasters,” Reuters reported following the event, “and also highlighted the ‘just in time’ philosophy pioneered by Toyota and followed by many others.”

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By ·
Download Article PDF

There are many faces of supply chain risk in today’s global business environment, where anything from a natural disaster to supplier insolvency to geopolitical turmoil can temporarily or permanently disrupt the manufacturing and/or transport of goods. Add quality and safety challenges, regulatory and environmental compliance, and even economic changes like fluctuating exchange rates to the list, and it’s easy to see why risk should be a top-of-mind issue for supply chain managers.

While some supply chain disruptions are identified and addressed quickly and without much fanfare, others receive national attention. In April, for example, Toyota, Honda, Sony and other major firms encountered supply disruptions in the aftermath of multiple earthquakes in Japan.

“The earthquakes on Thursday and Saturday, which killed at least 41 people, reflected the vulnerability of Japanese companies to supply chain disruptions caused by natural disasters,” Reuters reported following the event, “and also highlighted the ‘just in time’ philosophy pioneered by Toyota and followed by many others.”

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About the Author

Bridget McCrea, Editor
Bridget McCrea is a Contributing Editor for Logistics Management based in Clearwater, Fla. She has covered the transportation and supply chain space since 1996 and has covered all aspects of the industry for Logistics Management and Supply Chain Management Review. She can be reached at [email protected], or on Twitter @BridgetMcCrea

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