Operational & financial risk

Identifying, measuring and managing supply chain risk

Driven by the need to identify cost savings and pursue growth opportunities, companies are creating highly complex supply chains. With increasing complexity comes increased risk - particularly in an environment where consumers are seeking more certainty over the integrity of the products and services they are buying.

Consumer focused businesses are therefore focusing more effort on demonstrating that their products are 'responsibly 'sourced. To do this companies need to understand the potential risks which may exist within their supply chains, from issues as diverse as child labour, human rights, environmental pollution and bribery and corruption. They then need to demonstrate that they are actively managing these risks to protect their brand and reputation and maintain and, potentially, grow market share.

Managing risks in a changing environment

Markets are evolving more rapidly than ever before. As companies aggressively pursue their strategies to deliver growth and reduce cost, they are undertaking complex change programmes to accommodate this market change. Many programmes, however, are failing to realise their intended benefits.

This is often because the risks involved in the project are not identified up front or the risks the project can create in the wider business fail to be identified. A portfolio of change projects will significantly increase risk to the business. Often managers are not equipped with adequate knowledge or do not have a clear enough view of the whole business to identify all the risks involved.