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How To Mitigate Supply Chain Risk
Businesses must learn from the pandemic that change is the only constant. It is crucial to avoid becoming complacent in any given situation, as nothing lasts forever. Risk assessments are crucial for all companies to prepare for future obstacles. Mitigating risks in the supply chain is especially important as it can be sprawling and unpredictable.
You may face natural disasters, war, data breaches, theft, or supplier bankruptcy. This can lead to complications, and damage to your operations, and reputation. Preparing and reducing the impact of these issues is vital to avoid being put out of business. Here are some top tips from Bombyx PLM to help you mitigate these risks.
Prioritise Supplier Quality
Research the reputation of your suppliers before working with them. Verify their standards of service and product quality. Check how they treat their staff, source their materials, and collaborate with others.
Also, perform due diligence on their finances to determine if you want to work with them long-term.
Research Supplier Risk
It is helpful to know the risks your suppliers face. These risks may include country, regulatory, political, or local economic issues. Additionally, these situations could have an impact on your operations.
Use PLM Consulting
PLM software and technology can help you reduce development time, identify potential delivery and cost issues, steer clear of poor design decisions, provide you with early visibility, ensure quality and compliance – and a whole lot more.
It provides you with a centralised system to manage all the information related to your products, helping you to adopt a comprehensive approach to design, research, and development, as well as allowing you to operate more flexibly, making changes as and when appropriate based on the data you’re presented with.
Diversify
Avoid building vulnerabilities in your supply chain by making sure you have several sources for your products and materials.
You may be tempted by the lowest costs available but having a list of secondary suppliers can be useful to help drive down the risks involved. You can also help minimise the risks associated with different regions and countries by localising your supply chain as much as possible.
Carry out Regular Reviews
Risk assessments and reviews should be carried out regularly so you can identify any changes in your supply chain and act accordingly, thus minimising the impact that potential disruptions may have.
Strengthen Your Cybersecurity Defences
With the rise of the Internet of Things showing no sign of slowing down, it’s essential that you’re aware of the risks posed by the likes of malware, hacking, phishing, ransomware and so on. Implement compliance standards for all your third-party vendors, carry out robust vendor risk assessments and introduce security controls to restrict system access.
If you’d like any further advice, get in touch with the Bombyx PLM team today to see what we can do to help you and your business grow and develop in 2022 and beyond.