“The most successful risk-management plans are those that involve input from and education for key stakeholders. Many organizations invest significantly in training programs to improve employee skills, but not in educating employees on inherent business risks and their role in managing and mitigating such risks”.
This quote taken from the recent CFO.com post, Avoid Three Key Supply-Chain Land Mines, offers continued guidance on managing risk in the supply chain. Focused on how organizations can take a more proactive approach, the author offers a structured three-prong framework to sustainable supply chain risk mitigation. Key components of this comprehensive advice include:
- Look Beyond the Obvious – Some organizations focus on mitigating risks that are palpable and overlook less-obvious ones.
- Expect the Unexpected – Organizational risk-management plans may deal with known or suspected risks but fail to provide a comprehensive overview of the risks inherent within the supply chain.
- Practice to Be Perfect – Some risk-management plans are contained neatly in binders and placed on shelves. That doesn’t mean those responsible for implementing these strategies are aware of the origin, likelihood, and severity of risk that exists. Effectively planning for risk requires full disclosure of risks, and all risk-mitigating and contingent actions that may be required, to all who will have to perform such actions.
Within our sustainability consulting, we find common characteristics among sustainable organizations to have the ability to effectively manage the flow of information across key business stakeholder relationships. While many organizations target immediate value, some of the more well known leading organizations continuously assess the health of their supply base. This provides for opportunity to immediately determine risk. In fact, the true ‘business sustainability’ differentiators are those who understand and effectively mitigate the potential derailleurs of supply. Visit us at Taiga Company to learn more.