RISK MANAGEMENT
ENHANCING PROCUREMENT VALUE WITH RISK MANAGEMENT
Discover how organisations enhance procurement value with effective risk management with Nicolas Walden , Vicky Kavan , Andrew Elvish and Jack Macfarlane
WRITTEN BY : GEORGIA WILSON
Expanding beyond a one-off exercise of basic supplier due diligence and screening of financial risks , supply risk management today includes a broader set of activities .
They include identifying , evaluating , controlling and the continuous monitoring of a much more extensive set of risks and risk domains for both direct and indirect spend .
“ Simply put , it means procurement teams are taking action to mitigate or bear the inherent risk in third party relationships . Today , there is even an ISO standard – ISO31000 – for those seeking principles , process and guidance on the topic ,” explains Nicolas Walden , Associate Principal and UK and Europe
Practice Leader , Procurement Advisory at The Hackett Group .
Emphasising that risk management activities should be undertaken early in the process of evaluating whether to do business with any third party , as well as reviewed periodically at least annually , or when a significant event occurs , The Hackett Group encourages companies to focus their efforts on the most critical suppliers and supply chains .
“ Risk management can be the difference between success or failure as modern procurement teams become responsible for all third party relationships ,” says Nicolas .
Echoing Nicolas ’ thoughts , Jack Macfarlane , Founder and CEO of DeepStream , explains that “ teams must
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