TOP 100 WOMEN

Strengthening supply chain resiliency and forging true supply partnerships is a key imperative that today ’ s procurement organizations must tackle .

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Written by : Rhys Thomas

You have to be a good customer to your vendor — especially with regard to mitigating risks throughout the supply chain .

Chris Windfelder

Managing Director EY-Parthenon Ernst & Young LLP

Procurement is expected to create resiliency for certain risks that exist within the supply chain .

Vijay Yalamanchili

Partner Supply Chain & Operations Consulting Ernst & Young LLP

This publication contains information in summary form and is therefore intended for general guidance only . It is not intended to be a substitute for detailed research or the exercise of professional judgment . Member firms of the global EY organization cannot accept responsibility for loss to any person relying on this article .

No organization is immune to the challenges that threaten supply chains and operational continuity . But risk can be mitigated by building resiliency as an imperative — an objective for which procurement organizations are uniquely placed to achieve .

“ Procurement is expected to create resiliency for certain risks that exist within the supply chain ,” says Vijay Yalamanchili , Ernst & Young LLP Advisory Services Partner . “ We ’ re seeing a shift of those organizational capabilities in procurement , going beyond sourcing and starting to differentially invest in other areas , including contracting excellence and supplier risk analytics .”

Risk comes in many forms , but can largely be defined under five categories , as identified by Chris Windfelder , EY-Parthenon Managing Director : changes in customer preferences ; adoption to technology and associated cyber vulnerability ; geopolitical turmoil and governmental regulation ; brand perception and social media ; and unforeseen supply shocks , such as COVID-19 .

“ Building resiliency in your supply chain helps to mitigate , or at least understand , where your risk may be across those five overarching profiles ,” Windfelder says . Tabletop exercises and stress tests can be invaluable tools in understanding where an organization ’ s biggest risks lie . He adds : “ It really all starts with trying to laser in on which risks are most likely to occur , while also understanding that there ’ s always an unknown .”

Strengthening partnerships is also key in today ’ s market , where the more stretched supply chains and procurement ecosystems become , the more options suppliers have . “ You have to be a good customer ,” says Windfelder . “ Providing a true understanding of how you as a customer can add value to your vendor is equally as important as your vendor adding value to your own market — especially with regard to mitigating risks throughout the supply chain .”

Data is the final tool that procurement organizations must leverage when building true resiliency . “ We ’ re working with many of our clients to understand how they capture data , how they enhance the data that they already have with automation and AI , and then how they bring in the external information that is most valuable to their organization , because there ’ s a cost in doing so ,” Yalamanchili explains . “ These are the key elements of data and analytics that are absolutely critical for driving all the outcomes that are related to risk and building that resiliency .” PROCUREMENTMAG . COM

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