Complex supply chains are getting harder to manage and risks can go undetected, despite the promise of innovative technology that will help to handle transactions simply. Almost half – 47 per cent – of supply chain professionals said their business had lost revenues as a result of poor supply chain management, according to a 2015 Thomson Reuters Survey. Rather than supply chains becoming efficient and transparent as we adopt new technologies, this article asks whether companies are actually “spinning an intricate ‘supply web’ that could leave them trapped by unexpected events and risks”.
It also points out that many companies – 35 per cent of those surveyed – also described their supply chains as 'very complex'. It stands to reason that as supply chains extend globally, the risks will increase. Thomson Reuters looks at price risk, supply risk and supplier risk – and the graph below shows some of the biggest risks in a company's supply chain.
How companies can manage the opportunities and risks in the supply chain has been covered on CTMfile frequently. While digital technology is enabling – or has potential to enable – companies to be more efficient, to innovate and work in a way that's more coherent across the organisation, there are even greater changes on the horizon as initiatives to develop blockchain solutions for trade finance and the supply chain are due to come to fruition by the end of this year.
The types of risk companies now face in the supply chain are also shifting, as shown by the Allianz Risk Barometer of global business risks for 2017. Corporates also need to be aware of the hidden risks in their supply chain, particularly those associated with third-party relationships with suppliers.
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