Risk is a moving target Tomorrow’s risk will be different -
The systems used to identify and respond to risk must be agile. They require continuous, critical, re-evaluation and tuning.
Different risks require different data
- Look beyond historic financial and operational metrics. Acquire solid data on supplier capacity, technology, certifications, capital structure, engineering practices, safety training and other factors.
Understand Market Factors
- The cost of raw materials, energy, capital, taxes and labor can have a local, regional, national or global impact.
Enable data sharing between trading partners -
Make it easy for suppliers to share profile, financial and operational data. Give something back in return. Earn the supplier’s trust. Standardized platform across the industry will help: Vontik.com in Automotive.
Breakdown internal data silos
- There is a natural tendency to hoard data. Leadership is needed to break it free. Compromising on a smaller subset of the desired whole can get things moving.
Analytics is hard – it takes a team
- Individual front line decision makers aren’t usually well equipped to do effective analytics without assistance. Build analytic teams and promote sharing between business units. Education and training are important. Nurture and reward those who demonstrate skill.