In summary, the author provides five important considerations for managing supply chain risk. While stated, to move forward in this world, avoiding risk is impossible, so we have to take intelligent risk. These are:
- innovation and efficiency in contracting management;
- strategic requirements for supplier insurance, indemnification and limitations of liability;
- provider optimization and redundancy;
- supplier financial stability visibility; and
- proper diligence in operational supplier assessment reviews.
Here are those components from a food safety perspective.
Innovation and efficiency in contracting management - it is important to review contracts regularly, updating to current systems of management, and incorporating information such as updated specifications, required controls. Goal is to avoid outdated information on contracts.
Strategic requirements for supplier insurance, indemnification and limitations of liability - Are they
required to support, and can they financially support an issue that they cause to the product you sell.
Provider optimization and redundancy - Does the supplier have a back-up plan to get you product or do you have a back-up plan (secondary supplier).
Supplier financial stability visibility - Do you know that your entire supply chain can remain financially viable. This is especially important when we work internationally.
Proper diligence in operational supplier assessment reviews - this is one where the technical people are most actively involved. Sure we can review audits, but are we following up on those audits to obtain verifiable proof that our suppliers are responding to the audits.
SupplyChain Management Review
http://www.scmr.com/article/five_techniques_to_manage_supply_chain_risk
Five Techniques to Manage Supply Chain Risk