Resilience: An Incomplete Business Objective?

Are you satisfied with your current supply chain risk and resilience program? ... I didn't think so, or at least that's what Business Executives are saying. This is why my team and I have developed a workshop about risk and executing at the intersection of supply chains and markets.

Single Point of Failure: The Next Step

Most supply chain experts know that something is wrong but often cannot articulate exactly what that is. So ask yourself ...

• Is your supply chain risk strategy based on responsiveness, compliance, and resiliency?
• Is resiliency an incomplete strategy?
• Do you want to engage leadership, be part of the critical decision-making process and connect with your organization’s profitability goals?  
• Do you leverage your investment in risk to create market value, i.e. new revenue opportunities or support greater value and price?   
• Do you limit your risk capabilities and competencies to the cost side of the profitability equation? Does your risk investment address market value or price side of profitability?
• you leverage risk to pivot your business strategy?

Value Preservation versus Creation

In a recent AIAG (Automobile Industry Action Group) workshop, 74% of the participants described their current supply chain risk strategy as reacting to events or the need to comply with risk requirements. However, when asked what strategy they prefer, 73% stated a value-, performance- or market- based.

Why the gap?

Since I published the book, "Single Point of Failure: Ten Essential Laws of Supply Chain Risk Management", Wiley, 2009 Amazon, much has been written and learned about the value of supply chain risk investments. The topic became more relevant due to large scale transportation, sourcing and manufacturing disruptions such as the 2010 Eyjafjallaj?kull Iceland volcanic eruptions or the 2011 Japan earthquake and Thailand floods. The lessons learned served as the genesis for greater attention, investment and action for supply chain resiliency.

However, is management's fixation on resilience enough? More importantly, does a resiliency objective exploit the opportunity for growth or support the profitability agenda? Here are three considerations when moving beyond resiliency:

• Supply chain risk and resiliency management programs today are designed to preserve value rather than create value for the organization. It's important but incomplete and unsustainable business objective.  What if your competitor had the knowledge and know-how to side-step your resiliency objective? Having the foresight to think ahead and convert uncertainty into opportunity is a growth strategy, one that is more effective than mere resiliency. 
• Supply chain risk and resiliency management programs today are functionally or process oriented, plagued with individual biases and endless stand-alone risk management programs. Does the market or executive leadership care less about the source of the risk or more about the ramifications and opportunities?
• Supply chain risk and resiliency management programs may leave money on the table.   If your investment in risk does not allow you to pivot your business strategy, you are missing an opportunity to gain market advantage and to engage executive leadership.  Why not be an industry leader and leverage the investment into market value and competitive differentiation?

Closing the Gap

Come join us for a workshop about risk and executing at the intersection of supply chains and markets (or we can come to you). Here's what you will learn at the workshop:

• How to leverage supply chain risk and resiliency investments and use them to pivot your business strategy, when a change occurs.
• Why resiliency is an incomplete business objective for your organization.
• How to move your program beyond modes of reaction, crisis, and compliance to a value-driven strategy that exploits a market advantage.  
• How to advance your risk sensing capabilities and focus on what matters most.
• How to enhance your sources of data, tools, technology, and capabilities.
• Through a practical lens, how to create action plans to achieve greater value and identify opportunity in the supply chain risk and resiliency program.

Single Point of Failure: The Next Step Workshop

www.theriskproject.com

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