During the development of the Supply Chain Risk Management Guidelines, the project team created a Risk Categorisation Matrix, comprising details of the possible Supply Chain risks and their causal factors. Analysis of the matrix showed that one of the OEM’s primary Supply Chain risks is the availability of adequate and proven production capacity at the supplier’s site.
For many years organisations have used contingency plans to mitigate the worst effects of a potential supply risk. However, with companies now requiring ever-greater flexibility, shorter lead times and reduced inventories from their long-distance, global supply networks the probability of a supply failure has become heightened.
