@Risk

Now that labor costs in China are on the rise, high-tech companies in Asia are exploring alternative sourcing locations within the region, as well as in North America.

In fact, according to new research from UPS, half of all high-tech trade lanes in five years’ time are expected to involve intra-Asia movements.

The annual survey, conducted by IDC Manufacturing Insights, polled senior-level decision makers at high-tech companies in the Asia Pacific region. The results show that: (more…)

Global production of food and other goods regulated by the US Food and Drug Administration has skyrocketed over the past decade –so much so that the distinction between domestic and imported products is now obsolete, according to Commissioner of Food and Drugs Margaret A. Hamburg, M.D.

“There has been a perfect storm – more products, more manufacturers, more countries and more access.  A dramatic change in strategy must be implemented,” she said last week, as the FDA unveiled a new strategy to meet the challenges posed by rapidly rising imports of FDA-regulated products and a complex global supply chain.

The strategy, outlined in a report called the Pathway to Global Product Safety and Quality, calls for the agency to transform the way it conducts business and to act globally in order to promote and protect the health of the nation’s consumers. For example, the FDA says it will:

• partner with its counterparts worldwide to create global coalitions of regulators focused on ensuring and improving global product safety and quality. These coalitions of regulators will develop international data information systems and networks and increase the regular and proactive sharing of data and regulatory resources across world markets.

• build in additional information gathering and analysis capabilities with an increased focus on risk analytics and information technology.

• leverage the efforts of public and private third parties and industry and allocate FDA resources based on risk.

• augment changes already set in motion. For instance, between 2007 and 2009, the FDA increased the number of foreign drug manufacturing inspections by 27 percent and has opened a series of international offices in key locations.  FDA has also collaborated with its counterparts in the European Union and Australia on drug inspections, worked to  integrate certain aspects of drug regulation via the International Conference on Harmonization and joined the Pharmaceutical Inspection Cooperation/Scheme (PIC/S) which is an organization of the drug manufacturing inspectorates from 39 countries.  The FDA and other global leaders are also creating an expanded global regulators forum for medical devices.

• broaden its food safety efforts under the FDA Food Safety Modernization Act (FSMA). This new law creates a new foods safety system, in which FDA has a legislative mandate to require comprehensive preventive controls across the food supply chain and has new tools to hold players in the supply chain responsible.  There are also new inspection mandates, including a mandate leading to the inspection of more than 19,000 foreign food facilities in the year 2016.

These new initiatives will enable the FDA to better address fundamental global shifts that are on the horizon. In particular, the agency says it is preparing for these worldwide trends: (more…)

How confident are you in the effectiveness of your compliance functions?

If you’re like many of the business leaders recently surveyed by PwC US and Compliance Week, you may be a bit uncertain about exactly how you want to answer that question.

PwC US and Compliance Week polled senior compliance officers at more than 100 leading US companies, asking them questions about four key areas critical for the compliance function: leadership, reporting relationships and structure; compliance function scope, focus and risk; metrics to gauge program effectiveness; and budget, staffing and resources.

When the results were analyzed, the survey showed that one of the biggest obstacles facing Chief Compliance Officers (CCOs) is measuring the effectiveness of their compliance functions.  In fact –as remarkable as it sounds –nearly 40 percent of the companies surveyed said they make no attempt to measure the effectiveness of their compliance program.
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What are supply chain professionals thinking about as they look ahead into 2011?

A recent survey conducted by eyefortransport in September and October 2010 reveals some intriguing insights about their mindset –and the results are largely positive. For example: (more…)

Hello to Everyone,

I am excited to take the reins of Aravo’s @Risk blog. Kevin has set a high bar both in the range of his coverage and the quality of his analysis, and I will strive to maintain that level of excellence as we explore the many facets of Risk.

A bit about me . . .

I am a 25 year veteran of supply chain strategies, execution, and solutions across industries and geographies. I began my career in professional services with E&Y helping companies assess supply chain issues and mitigating risk through the design and implementation of approaches, processes and software. From there, I moved on to enterprise supply chain solution strategy and marketing for companies like Oracle, PeopleSoft, Ariba and others. Add to that my time on the board of directors of the Supply Chain Council and conducting global trade risk research as the leader of the supply chain group at The Aberdeen Group, and you can see that I have a strong foundation and commitment to the topic.

As to Risk itself, it comes from many sources and impacts every part of your supply chain and supplier relationships. How do you define risk? Is it the risk that comes from a key supplier financial failure? From supplier product quality or liability? From supply chain disruption due to natural disasters? Infrastructure failures? Geo-political factors? From commodity price volatility? Social responsibility failures or code of conduct violations? Regulatory compliance?

Unfortunately, in today’s business environment the correct answer is “All of the above” — and more. Add to that the difficulty in measuring and monitoring those risks, combined with the complexity of developing mitigation plans, and it’s no surprise that many enterprises are ill prepared to deal proactively with risk.

So we have a wealth of topics to continue to explore here on @Risk. I look forward to taking that journey with you.

Bob