Supply chain risk is something that all businesses should understand, and work hard to mitigate.
By Michael Davies, CEO, ContinuitySA
Last time, I introduced the first of five risks that will affect African businesses over the coming year and into 2017. The second risk our team identified is one that has become more prominent over the course of the last several years: supply chain risk.
The first point to make is that today’s business environment is characterised by long supply chains and greater collaboration with business partners—something that introduces more risk into the equation. Risk can no longer be compartmentalised, so to build true business resilience you need to understand your key dependencies and how resilient your partners are.
The old adage about the chain only being as strong as its weakest link summarises this fact of contemporary business life.
One trend that is of particular concern is companies’ growing use of cloud providers to supply more of their IT requirements. Cloud itself is not the issue; the problem comes when a company assumes its cloud provider has the ability to recover from a disaster. Our best advice? Don’t assume your cloud provider has a good business continuity plan: check it out!
Another key risk relates to the ever-present danger of local utilities running into delivery challenges—a question mark now hangs over power and water supplies, and this threat could affect the whole supply chain. Even if you have measures in place to deal with a power outage, what is the impact if your supplier in goes down and cannot recover in time to fulfil your order?
One supply chain risk is of particular concern: How well prepared is your telecommunications service provider to deal with a prolonged power outage—for example, when communications masts cease to function because their batteries run down?
Next time, 2016 risk No. 3 in detail—are you prepared to go back to basics?
[author] [author_image timthumb=’on’]https://www.continuitysa.com/wp-content/uploads/2013/01/Michael-8-6400.jpg[/author_image] [author_info]Michael Davies has been involved in the Business Continuity Industry for more than ten years, having spent the last twenty years in the IT Industry with companies such as Dimension Data, Enterprise Technologies, Amdahl, Computer Configurations and MGX. Michael has predominantly been on the financial side of business with the most recent progression in 2011 being from financial director to CEO of ContinuitySA in 2011. He has spoken on organisational resilience and BCM at various conferences and heads up the largest independent BCM supplier in Southern Africa. Michael completed a B.comm degree from the University of Natal and a MBA from the Henley College in the UK. He is an affiliate of the Business Continuity Institute based in London and a member of the Institute of Directors. [/author_info] [/author]