Supply Chain Risk Management is becoming a top priority in procurement as 95% of Fortune 1000 companies are seeing disruptions within their supply chains. Organizations are losing millions due to cost volatility, non-compliance fines, and incidents that cause damages such as the risk of natural disasters, or hazards. Many businesses that relied on suppliers based in China had to realign the supply. Coupled with the pandemic and geopolitical disturbances, the significant impacts that supply chains and operations have on the planet and society are not meeting stakeholders’ expectations for sustainability.
Fundamental changes in consumer behavior are setting Business Leaders in motion to source closer to home on a need and demand basis, use alternate supply bases and products or reevaluate the suppliers. Supply chain leaders are trying to turn the complexity and disruption into meaningful change. Brands also have goals on sustainability which get passed to the T1 and T2 suppliers which adds to the cost of supply.
Why- As businesses respond to the immediate impacts of the pandemic and geopolitical issues, companies must develop a robust framework that includes a responsive and resilient contingency plan for the short as well as the longerterm period.