As an operating business it is in the best interest of all stakeholders that a strategic supply chain management plan is put in place so that when there is a catastrophic disruption in a company’s supply chain, various steps can be taken to minimize the risk.
So how does a business mitigate the risks imposed by a disruption in its supply chain?
First step is to identify the risks that are associated with disruptions in a company’s supply chain. Disruptions in a company’s supply chain can come in various forms. Most of them will fall along the lines of:
Political risks and labor unrest
Weather events and natural disasters
Fire and power grid blackouts.
Equipment breakdowns.
The next step is to put together a comprehensive supply chain risk management program that clearly outlines how a company evaluates its suppliers and responds to any disruptions in its supply chain. Thus in the event of any unforeseen disruption in the supply chain, the company is well positioned to mitigate risk posed by that particular disruption and lessen the financial impact to the business.