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Thursday, September 02, 2010
Thursday, September 02, 2010
Risk Management News
Posted: Thursday, January 14, 2010, 8:56AM
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KNOWLEDGE MANAGEMENT TAGS
"Risk Management"
Fortune 1000 firms ignore risk for 80 per cent of suppliers
On average Fortune 1000 companies are managing risk for less than a fifth of their suppliers, new research claims.While global corporations are focusing on creating collaborative partnerships with suppliers to make supply chains more efficient, the poll from SaaS Supplier Information Management (SIM) software and services firm Aravo, found that more than half of the financial, procurement and risk executives polled from Fortune 1000 rims have less than 20 per cent of their supplier base under active risk management.
A significant number of those polled (71.4 per cent) expressed that their biggest concern continues to be risk of supplier financial viability. Companies that participated in the poll are also exploring opportunities to maximise budgets by adding more emerging market suppliers. For instance, the study found that 31.2 per cent of those polled are "heavily penetrated in emerging markets" while another 31.2 per cent have "already sourced some suppliers in emerging markets and are looking to expand low-cost country suppliers in 2010."
The top concern expressed around suppliers in emerging markets is regulatory compliance (41.7 per cent), followed by the financial viability of these suppliers (33.3 per cent). Only 25 per cent of those polled were concerned about product quality.
"Based on our poll results we see a call to action for global corporations to implement more robust risk management processes to reduce the possibility of supplier failures and supply disruptions, improve supplier performance management, and enhance supplier compliance initiatives," said Aravo CEO Tim Albinson. "
The results were based on a recent poll of more than 200 risk, finance, procurement, and supply chain executives from Fortune 1000 companies.
Procurement Tags - Benchmarking, Risk Management
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