Visibility is key to a resilient supply chain

Recently the ‘Supply Chain Resilience Report 2015’ has been published within the Business Continuity Institute (BCI) World Conference in London. This report is an influential industry resource which tracks the origins, causes and consequences of supply chain disruption across industry sectors and regions worldwide and one of the most comprehensive, practitioner-led studies in the field. For this reason BCI and Zurich Insurance Group had surveyed 547 executives and managers at small and medium-sized companies from 67 countries. As these latest findings provide interesting insights, I would like to give you a summary on the main points. One of the key findings of the study is that visibility is key to a resilient supply chain.

Visibility is key to a resilient supply chain

Visibility is key to a resilient supply chain

Visibility is key to a resilient supply chain

One of the key facts concerning frequency and origins of occurring disruptions reveal that 74 % of the respondents had suffered at least one instance of supply chain disruption. Nevertheless it is almost the same percentage of companies (72 %) that does not have full visibility over their supply chain. In addition one in ten of the surveyed companies do not even know who their major suppliers are.

Regarding the causes for disruptions unplanned IT and telecommunications outage is topping the list with 64 %. Nearly a half of the respondents experienced cyber attacks and data breach. Adverse weather ranks also among the top three with exactly 50 %. These figures clearly show the growing significance of non-physical risks. Hence it is worth to assess resilience in this sector.

Consequences of supply chain disruptions

The most common consequence of disruption was a loss of productivity with 58 %. 40 % and less experienced the following impacts: customer complaints, increased cost of working, loss of revenue and impaired service outcomes. Interestingly the survey also tracked the costs and the uptake of insurance in covering losses associated with supply chain disruption. A significantly high percentage of organizations (58) has entirely uninsured losses. Cumulative losses of at least € 1 million fall from 23.6 % to 14 % in this year’s results and less than 10 % of organizations claim losses of at least € 1 million as a result of a single incident.

Infographic key findings

The following infographic sums up the key findings of the ‘Supply Chain Resilience Report 2015’

Supply Chain Resilience Report 2015

Supply Chain Resilience Report 2015

All in all the survey shows that one of the biggest challenges to resilience is supply chain visibility. As disruptions continue to occur at lower tiers it is important to monitor the entire supplier network. Therefore, executives must spend all their energy to ensure a transparent and resilient supply chain.

Do you want to learn more about the ROI of  creating near real-time visibility into your supply chain and suppliers? Read more here.

Do you want to read the complete study?

Rolf Zimmer is a founder and managing director of riskmethods, and is responsible for Finance, Product Strategy and Customer Success Management.

Rolf has been working in software business and procurement for 18 years. He has excellent knowledge in the areas of procurement, supply management and risk management – which he gained from working inside procurement departments as well as from consulting activities at SAP, Ariba and Emptoris, among others. His previous position as Sales Director at IBM included responsibility for distribution of the “Emptoris” Supplier Relationship Management suite and associated consulting services.


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