June 08, 2022
June 08, 2022
Contributor: Jordan Turner
It’s important to balance investments in people, process and technology.
Disruptions in the last several years have reinforced the importance of supply chain risk management that enables organizations to manage risks while also delivering business results.
Download now: How to Reduce the Rate of Supply Chain Disruption
The 2021 Gartner Supply Chain Risk and Resilience Survey indicates 79% of large organizations are leaning into resilience and risk management. We predict that by 2025, supply chain risk management will be a key success driver for more than 50% of organizations. Plus, we found that many organizations are developing a dedicated function with multimillion dollar budgets to spearhead the effort.
“Supply chain leaders must invest in building an advanced risk management function. It’s not a choice but a survival decision at first and then a differentiator for success,” says Koray Köse, Senior Director Analyst at Gartner. “Technology is key to scale, but it must be chosen carefully to match critical required capabilities.”
Learn more: Transform Your Supplier Relationships with Gartner's Automated Scorecard
Supply chain risk management will soon be a core competency and budget line item that requires effective investments and holistic management. It has the potential to impact almost every stakeholder inside and outside of the supply chain function. Almost 80% of survey respondents at large organizations have used lessons from past disruptions to change the way they conduct business. They are leaning into resilience and agility in an attempt to be more proactive and better prepared.
An effective supply chain risk management strategy consists of well-designed processes and dedicated resources to manage situations that hit organizations unexpectedly. The right mix of technologies — ones that enable better supply chain visibility, information gathering, analytics and decision making — are the differentiators.
Learn more: Your Ultimate Guide to Supply Chain Management
Risk management is not a guarantee of mitigation, but it does prevent specific risks by enhancing absorption and recovery capabilities. Consider the below risk categories that you can manage:
Learn more: Supply Chain Planning — Your Strategic Guide to What, Why and How
These questions will help facilitate the creation of a risk management roadmap.
Download now: What Top Supply Chain Companies Do Differently
In short:
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Recommended resources for Gartner clients*:
Procurement’s Critical Role in Boosting Supply Chain Resilience
Tool: Key Risk Indicators for Supplier Risk Management
Market Guide for Supplier Risk Management Solutions
Infographic: Supply Chain Visibility Is Fundamental to Resilience in Supply Ecosystems
*Note that some documents may not be available to all Gartner clients.