Tuesday, February 11, 2014

Supply Chain Professionals Assess the Threat to Global Logistics

Singapore Conference Warns that All Risks Should be Anticipated
Shipping News Feature

SINGAPORE – WORLDWIDE – The Council of Supply Chain Management Professionals (CSCMP) held its 2014 conference, entitled ‘Effective Strategies for Managing Supply Chain Risk: Assuring the Viability of Your Supply Chain’ in Singapore last month and the event, which attracted almost 200 high-ranking delegates from manufacturing, logistics, government and academia, was centred on planning for the ‘worst way’ scenario’s which have often featured in global logistics of late.

With floods, fires and the like only too often making the headlines in the past year or two, several speakers used the earthquake and resulting tsunami is Japan, the Icelandic volcano, and the floods in Thailand as examples of the problems risk management applications must typically confront, and demonstrated how their companies had deployed risk mitigation strategies. They stressed the importance of constantly reviewing strategies, with evaluations conducted at least annually. Delegates were advised that they should map their supply chains for exposure to such catastrophic risks and produce separate maps for each eventuality.

Presenters identified assets, company image and brand reputation, service levels and business continuity as key elements all requiring protection. The need for diversification of suppliers and production points was also an element commonly-cited as essential in risk management strategy; the example was given of one large electronics company which ensures each supply line has three suppliers for every item required. Another showcased firm regularly practices business continuity drills with its key suppliers.  

The need to focus on training staff, giving them appropriate resources for responding, and developing the expertise to employ those resources also figured strongly in advice to delegates. One very important point raised was the need to take risk evaluation beyond Tier One suppliers, possibly requiring them to engage Tier Two and Tier Three suppliers in the risk management process.

The vital importance of communication was also stressed: the audience was told employees must know that their company will communicate if a major disaster occurred, and top management must demonstrate its awareness of, and commitment to, the risk management strategy. Commenting on the conference, CSCMP CEO Rick Blasgen said:

“We were delighted at the quality of speakers and attendants at this year’s event, representing some of the biggest names in global trade. Threats to supply chains are too easily ignored until the worst happens. Prevention, in this case through the exchange of best practices, ideas, and case studies, is not only better than a cure, but always less costly. We hope our delegates have gone back to their bases armed with ideas to minimise supply chain disruption if disaster strikes.”