@Risk

Risks associated with the supply chain issues are now top of mind among CFOs, finance directors, and heads of operational risk, according to a recent survey by the Institute of Chartered Accountants in England and Wales and disaster recovery specialist SunGard Availability Services.

More than 70% of those polled said the risk of disruption caused by supply chain issues had dramatically increased over the last year. Likewise, they also cited new concerns over the stability and resilience of smaller supplies and partners during these tough economic times.

“All organizations need to assess the impact that disruption to their supply chain could have on their business and have plans in place to continue normal operations should a supplier run into problems,” says Keith Tilley, managing director UK and executive vice president Europe for SunGard Availability Services. “What is encouraging about this research, however, is that resilience is now being discussed at the highest levels of decision-making within more and more organizations, whereas before it was often overlooked and left to the IT department to look after.”

I agree. This ICAEW data contradicts other research which suggests that CFOs are continuing to focus almost exclusively on cost-cutting, despite significant emerging supplier risk – and so it really is encouraging to hear that, at least among some finance exes, the tide may be starting to turn.

Once CFOs recognize that supply chain operations are integral to risk and therefore fundamental to both bottom line performance and cost savings goals, they can begin to work together with procurement to limit financial risk exposure.  It’s all part of the good governance that leads to development of an integrated, enterprise-wide risk management strategy –an approach that not only mitigates risk, but also positions organizations to benefit from the opportunities that will surely arise as the economy begins to heal.