Cooperative risk management to master supply chain disruptions
Pretty much every company faces disruptions to their supply chain. Cooperative risk management can help, according to an ongoing study conducted by Jacobs University Bremen with the support of the Funk Foundation. But very few companies have used this opportunity for cooperation in times of crisis.
Today the supply chains of many companies are characterised by heavily networked systems, a high degree of internationality and a number of partners working together within one network. As the complexity increases, so too does the risk of disruptions: 99 per cent of the companies surveyed indicated that they had experienced a disruption to their supply chain within the last five years.
Small to medium-sized companies are especially exposed to increased risk, as Dr Alexander Skorna, Business Development Manager at Funk, explains: ‘They are generally much more limited in terms of resources, compared to bigger enterprises, and have much fewer production locations, so they lack buffer capacities. As a result, risk scenarios from the supply chain potentially have a larger negative impact.’
Just 28 per cent of the described disruptions to the supply chain were caused by the surveyed companies themselves. More often, problems arise from external influences, which companies should prepare themselves for. ‘But the potential offered by cooperation in risk management is not being fully exploited yet,’ says Dr Skorna.
The study also reflects this: although the surveyed companies rarely use cooperation as a risk management instrument, they rate it as the most effective course of action. Cooperation among suppliers or within a specific industry helps improve response times and reduce the negative financial impact of a disruption to the supply chain. It is a more efficient approach than each company in isolation preparing to fend for themselves in a potential crisis.
24.03.2020
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