Tag: Supply Chain Explorer

Categories
Innovation in Compliance

Exiger’s Fight to Secure Supply Chains: Spotlight on Energy


Welcome to a podcast series on the fight to secure Supply Chains through cross-industry innovation. Exiger sponsors this series. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management;  Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management;  Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs at Exiger; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this concluding episode 5, we discuss Supply Chain issues with Dan Banes and Mark Henderson in the energy sector. Highlights of this podcast include:

  • Key drivers for change within the energy industry around Third-Party and Supply Chain risk management
  • The impact of Russian sanctions on the energy industry; and
  • How ESG regulatory risk management has evolved within the energy industry.

Resources
Dan Banes Profile
Mark Henderson Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Blog

Exiger’s Fight to Secure Supply Chains: Spotlight on Energy

Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we have explored the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In our concluding episode 5, I visit with Dan Banes, President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead, and discuss supply chain issues in the energy sector.
Energy is one of the high-profile natures of the energy business, with long-standing business relationships, literally around the globe. Due to this high-profile nature, anytime there is a cyber-breach, it garners much attention. To see this play out, one only has to look at the Colonial Pipeline hack. This profile means that the whole world is watching the energy and the energy ecosystem.
We discussed some of the key drivers for change within the energy industry around third-party and supply chain risk management. Banes believes there are a couple of key trends in energy around supply chain risk management. The first is transparency (or perhaps lack of transparency) and the fact that many energy companies only have visibility into the first layer of their supply chain. This could be in the company they purchase their hardware from or the software products they install. He believes energy companies need to go down into those next layers to understand the additional suppliers that feed into those pieces of hardware or software.
The second area we reviewed is the monitoring of cybersecurity risk. Henderson said typically, and the approach has focused on “things like questionnaires and attestations that companies sign that say that they have a robust cybersecurity program.” He said, “now data is available for companies to do their homework themselves. This allows companies to understand the different companies within their supply chain and have transparency of the third parties you deal with directly and those suppliers down the chain. It allows a company to be alerted to a vulnerability and then quickly mitigate before a cyber security breach or attack happens.”
He believes companies will have to continue to push down responsibilities to that wider supply chain ecosystem. Companies are starting with their highly critical supply chain partnerships and ecosystem vendors. This has led to a “quite a collective dialogue, which is beneficial for the industry. If you go back to the point, we made earlier, one successfully compromised entity can have a ripple effect across the supply chain. It is better equipped for a successful defense if the industry can move their standards and best practices forward together.”
We then turned specifically to Russia sanctions. Here Henderson returned to transparency; companies need to understand the networks of parties they are dealing with. But it is more than simply understanding the company; and it also understands the owners of that company, the ultimate beneficiary, the key management personnel, so you can make sure that none of the individuals associated with the company are sanctioned individuals or on a Specially Designated National (SDN) list. This level of transparency and screening should be maintained on an ongoing basis to ensure that you stay up to date with all new sanctions. This is a fast-paced environment and ensuring that you have controls in place and the transparency in the companies you deal with is very important. The second component is ensuring you have proper supply channels. Russia and Russian companies are large exporters of energy products. This will impact the supply chain for several energy companies and has already caused supply shortages in many cases.
We concluded by looking at Environmental, Social, and Governance (ESG) and how ESG regulatory risk management has evolved within the energy industry. While most compliance and supply chain professionals understand that the ‘E’ has traditionally been the most letter within the ESG acronym, the ‘S’ within ESG, the social issues, is rapidly becoming as important a focus area as the ‘E’ has traditionally been. Banes noted a “huge commercial incentive for companies to move forward in this space; appropriately and effectively.” It could be based on legislation, such as the UK Modern Slavery Act or its German equivalent, but it could also be pressure from key stakeholders such as customers or employees. He noted this “will require companies to identify, assess, prevent, and remedy human rights, risks, and impacts across their supply chains.”
The recently proposed Securities and Exchange Commission (SEC) rules on reporting material climate change risk point to many concepts we touched on herein. Henderson noted that initially, these proposed rules were “meaningful accountability.” But Scope 3 adds “the transparency component as you are also moving down the supply chain and leading to perhaps commercial opportunities that were not present before because of collaboration.” Banes noted, “it does come with an opportunity to have a more meaningful relationship across your supply chain and find those efficiencies even that we were discussing across the control environment but finding those efficiencies when it comes to environmental risk and emissions. To obtain the data required for Scope 3 requires that partnership and the industry come together to find those efficiencies within the supply chain.”
Resources
Dan Banes Profile
Mark Henderson Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Innovation in Compliance

Exiger’s Fight to Secure Supply Chains: Spotlight on The Defense Industrial Base


Welcome to a podcast series on the fight to secure Supply Chains through cross-industry innovation. Exiger sponsors this series. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management;  Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management;  Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this episode 4, we discuss Supply Chain issues in the defense industrial base (DIB) with Jennifer Nestor and Theresa Campobasso. Highlights of this podcast include:
·      The DIB’s role in Supply Chain Security;
·      What has changed for the DIB regarding Supply Chain Risk Management; and
·      How the DIB responds to the government-led changes in Supply Chain standards.

Resources

Jennifer Nestor Profile

Theresa Campobasso Profile

Exiger Website

Exiger’s Supply Chain Explorer

Categories
Blog

Exiger’s Fight to Secure Supply Chains: Spotlight on Defense Industrial Base

Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 4, I visit with Jennifer Nestor, Vice President, Americas and Public Sector, and Theresa Campobasso, Senior Director for Defense Programs. We discuss supply chain issues in the defense industry.
We began with the role of the supply chain in the Defense Industrial Base (DIB). Nestor said, “the DIB is different from other sectors for several reasons, but two stand out. The first will be the unique relationship this sector has with national security missions. The DIB’s role includes defense research and development, production, delivery, and maintenance of military weapons systems, sensors, and other critical technology. This direct impact on US National Security means that the resilience and stability of the DIB and its supply chain are critical to ensuring US economic security and military technological superiority. Moreover, unlike other sectors, the US Defense Community’s ability to protect our nation rests greatly on the DIBs’ risk management efforts to fortify their supply chain, software, and hardware products. The second differentiator is the high rates of foreign adversary targeting that DIB companies experience as opposed to typical commercial organizations. This means that foreign intelligence actors like nation-states, organizations, or individuals employ aggressive actions like foreign investment, M&A activity, espionage, and supply chain and cyber operations to access the US critical infrastructure to steal sensitive information and disrupt our supply chains.”
We then turned to what is new for the supply chain in this area. The heightened pressure on supply chain security, specifically the higher regulatory standards related to supply chain due diligence, the increasing complexity of global supply chains, and, most importantly, the growing availability of data to support SCRM deep into the sub-tier supply chain. Nestor believes that the only way the DIB can ensure they support the Department of Defense’s (DOD) acquisition strategy is by investing in AI technology to map their supply chains and relationships throughout their programs. You can review both direct and indirect exposure to goods and materials from foreign adversaries and nation-state actors by performing supply chain illuminations. This allows you to map the sub-tier supply chain and provides insights regarding risks like counterfeit parts, IP compromise, and critical technology theft.
Campobasso noted an increase in executive orders and regulations over the last several years to address much-needed supply chain security reforms. Interestingly, many of these proposed higher standards put the responsibility on the DIB to prove and demonstrate this level of supply chain transparency and risk management. She cited the example of the “Uyghur Forced Labor Prevention Act, which requires vendors doing business with the government to establish evidence that goods are not the product of forced labor. Another example is the Feb 2022 DOD action plan to secure Defense-Critical Supply Chains.”
The DIB has responded to both these initiatives and challenges. Many large DIBs have moved to acquire an enterprise solution that gives them transparency and actionable intelligence beyond the first tier. Nestor said, “we are seeing the increased emphasis on risk management, and the DIBs are bringing large groups of often 20+ stakeholders to evaluate SCRM capabilities.” Moreover, this “cross-functional collaboration challenges both pre-sale and post-sale to gain consensus and determine how to manage the data and continuous monitoring, mitigate the risks and truly operationalize this increased capability.” Interestingly, the “DIB is also figuring out how to share the SCRM information with their sub-tier suppliers to drive accountability and how best to influence at that level.”
We conclude by considering how the DIB responds to this heightened level of risk insights. A truly effective SCRM solution is more comprehensive than just sanctions or watchlist checks. Campobasso noted that Exiger has a long history of assisting the Defense community to uncover hidden risks, helping to manage those risks, and making supply chains more transparent and secure, mainly through technological innovation and solutions. Specifically, the TRADES framework enables DIBs to measure SCRM program progress over time to ensure appropriate Return on Investment (ROI). Nestor concluded that there is still some organizational change resistance to these innovations. However, she believes that the key is to involve as many key stakeholders across the business and bring consensus to your project.
Join us tomorrow, where we will spotlight the energy sector.
Resources
Jennifer Nestor Profile
Theresa Campobasso Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Innovation in Compliance

Exiger’s Fight to Secure Supply Chains: Spotlight on Information Technology & Telecommunications


Welcome to a podcast series on the fight to secure Supply Chains through cross-industry innovation. Exiger sponsors this series. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management;  Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management;  Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this episode 3, we discuss Supply Chain issues in the Information Technology & Telecommunications industry with Skyler Chi and Andrew Lehmann. Highlights of this podcast include:
·      Unique vulnerabilities in this sector;
·      Potential operational disruptions from one geo-region or single source in IT; and
·      Hardware and software requirements in Supply Chain Risk Management.
Resources
Skyler Chi Profile
Andrew Lehmann  Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Blog

Exiger’s Fight to Secure Supply Chains: Spotlight on Information Technology & Telecommunications

Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 3, I visit with Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management, and Andrew Lehmann, Associate Director, and discuss supply chain issues in the Information Technology & Telecommunications sectors.
We began with an overview of risks affecting the Information and Communications Technology (ICT) industry. This includes hardware and software manufacturers and service providers. Because of this dual nature, there are dual challenges for companies operating in the ICT space. Chi noted this is “largely due to their business involving so much storage of sensitive customer data and facilitating the transmission of that data worldwide. It also includes attack factors on the infrastructure they are setting up and supporting. This means that the industry has to contend with multiple types of third-party and supply chain risks.
Supply chain disruption in this industry is a critical risk factor. Lehmann noted a couple of ways to help prevent such attacks, stating a “starting point is getting a handle on whether or not you have an overreliance in your supply chain concentrated in one geographic area or perhaps one country in particular. And not just that, but you might have an overreliance on a single supplier, just one company, one manufacturing facility in one country that is specialized in producing equipment to your specifications.” So, you should look at “who are all of your direct suppliers, and then go a few levels deeper and learn more about their entire supply chain and find out how much of that is based in one country.” He pointed to printed circuit boards, where “90% of the manufacturing facilities are in Asia, primarily east Asia. More than half of those factories are in China, which gives you a lot of risks just in terms of that geographic concentration.”
In addition to the direct risk modeling, you should also consider geopolitical risk. Here think of Taiwan, one of the staunchest US allies in the world. However, it is under increasing pressure from China. The Russian invasion of Ukraine has awakened many peoples’ eyes to the risk of the overreliance on supply chain manufacturers from Taiwan. Can you diversify your supplier base in light of this information? It may well behoove you to do so sooner rather than later.
Chi noted this is “a seismic shift in how our clients think about globalization globally. Previously a company would order a server rack, not caring where the parts came from. Today we are now asking the questions and establishing frameworks for us to realize that we may need to diversify ourselves away from Taiwan’s semiconductor industry, for example, where 53% of global chips are manufactured.” That “mental shift in asking the right questions and training which we work with to ask those questions is creating real-world impacts.”
We then turned to the question of to whom should this message be directed? Chi said this was an interesting question, as it got down to “management philosophy at core.” Historically the answer would be “supply chains deal with purchasing, and purchasing is done by procurement. This meant that procurement would be the risk stewards and the risk owners that have the responsibility to look into the issues.” However, that type of thinking has greatly evolved and indeed, “overwhelmingly what we’ve seen over the last two years is that various stakeholders from across the business have really formed working groups and can consistently communicate with each other.”
All of this has helped to do away with siloes. Now “procurement is working with the IT security professionals to perform vendor reviews of software bills of material for the hardware vendors that any given firm may be purchasing.” There has also been an evolution of the Board’s thinking about the supply chain and procurement. Chi related that it had been a “collective group effort across some of the world’s largest enterprises working together. It can include the background subject matter expertise of IT, security of procurement, or even diversity and inclusivity with vendors that you might be purchasing from, which is typically seen as outside of risk management function.” It is bringing “all stakeholders in the business, putting their budgets on the line to make those decisions.”
We conclude with the role of the Board of Directors. Boards must start asking questions about their organization’s supply chain risk and risk management strategy. Chi believes a key role for a Board is to “set the tone at the top of any given organization, align the shareholders’ values and provide the strategic vision of any given enterprise.” But he cautioned that most boards’ “lack of risk detection” around the supply chain could be a limiting factor. He emphasizes that Boards should “prioritize the governance framework of the firms that they oversee to the real-world risks of what that means to their organizations.”
Join us tomorrow, where we will put the spotlight on the Defense Industrial Base.
 Resources
Skyler Chi Profile
Andrew Lehmann  Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Innovation in Compliance

Exiger’s Fight to Secure Supply Chains: Spotlight Manufacturing and Consumer Markets


Welcome to a podcast series on the fight to secure Supply Chains through cross-industry innovation. Exiger sponsors this series. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management;  Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management;  Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this episode 2, we discuss Supply Chain issues in manufacturing and consumer markets with Kim Lee and Nick Wildgoose. Highlights of this podcast include:

  • Key challenges in Supply Chain Risk Management in the manufacturing and consumer sectors;
  • How manufacturing and consumer sectors can improve their approach to managing Supply Chain risk; and
  • The evolving supply risk areas in the manufacturing and consumer industry sectors.

Resources
Kim Lee  Profile
Nick Wildgoose Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Blog

Exiger’s Fight to Secure Supply Chains: Spotlight on Manufacturing and Consumer Markets

Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 2, I visit with Kim Lee, Associate Managing Director who focuses on risk and compliance, and Nick Wildgoose, a Consultant at Exiger. We discuss supply chain issues in the manufacturing and consumer markets.
We began with some of the key challenges in this sector. First, the manufacturing sector is incredibly diverse. It can be from electronics, automotive, clothing, and food, which are all vastly different, but a common denominator is the need to be cost-efficient. This makes cost-efficiency relevant to all in the supply chain. Over the past few years, Lee noted that she has seen supply chains in manufacturing and consumer sectors challenged “like never before with well-accepted practices put to the test.”
Moreover, from the macroeconomic perspective, COVID restrictions have disrupted every part of our supply chain, including air, ocean, and land freight, resulting in shortages.
Further, there have been factory shutdowns and labor shortages, which have impacted supply chains. The second type of macroeconomic factor is geopolitical. “The Russian invasion of Ukraine Russia is front and center of everyone’s mind, but there are also the China-US trade wars. In Australia, there are growing tensions between Australia and China, which has resulted in shortages in the supply chain to different degrees. These have been striking at the heart of the entrenched supply chain policy of centralizing distribution.”
Wildgoose noted that while most supply chains had responded to these issues, additional costs have been associated with the results. One of the biggest challenges is the cost of more thorough due diligence in looking at supply chain partners below tier one. This means understanding the multi-tier nature of your supply chain is critical. Before COVID-19, the only criteria was generally cost. But was, Wildgoose noted, “Suddenly COVID comes along, and you can’t operate your manufacturing lines, your consumer, sector stores without PPE, and suddenly it’s become strategic. It would be best if you also reassessed your risk management aspects. I think the other thing that companies have realized is that they need technology and data to look at this better, bring together the silos across the organization, and link up their approaches.”
Lee added that it is “a perfect time now for organizations to revisit their supply chain, risk management framework and ensure that it is fit for purpose, well communicated and understood.” This will help organizations in the current geopolitical environment manage the increasing expectations from consumers and regulatory expectations that continue to be challenging factors for manufacturing and the consumer sector. She added, “does your organization understand how far down the supply chain they have evaluated risks?”
Moreover, your organization should have a clear framework that sets out what you want to achieve. This should incorporate your risk appetite and tolerances, particularly in countries with a high perception of corruption. Other key risk areas include modern slavery and resilience, and operational efficiency. Having such a framework is important to ensure that everyone in your organization understands where the company stands and how to approach a supply chain risk management program consistently and coherently. Lee raised another issue which is around technology. The effective use of technology is fundamental to the success of your supply chain risk management program. With thousands of suppliers, you need to understand your risk profile.
We concluded by looking down the road at where supply chain risk management for manufacturers might be headed. The risks in this area are expanding. It could be cyber-attacks directed at your organization through a supply chain or ransomware claims which could bring your organization to a grinding halt by depriving your organization of key raw materials. Another key area is around climate change reporting risk, aka climate risk, from a supply chain point of view in the consumer and manufacturing sectors. Wildgoose said, “somewhere between 80 to 90%, quite often, of an organization’s carbon footprint is in its supply chain. Unless you understand your multi-tier exposure, how are the CEOs standing up to say, they’re going to achieve a net-zero?” Additionally, the financial community is looking at more disclosures around the impact of climate risk on companies. Indeed, the investment community, such BlackRock, Inc., have said that “sustainability is a competitive material issue that needs to be addressed as well.”
Join us tomorrow as we spotlight supply chain issues in IT and telecommunications.
Resources
Kim Lee  Profile
Nick Wildgoose Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Innovation in Compliance

Exiger’s Fight to Secure Supply Chains: Spotlight on Healthcare


Welcome to a podcast series on the fight to secure Supply Chains, through cross-industry innovation. This series is sponsored by Exiger. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management;  Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management;  Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this episode 1, we discuss Supply Chain issues in the healthcare industry with Erika Peters and Tim Stone. Highlights of this podcast include:

  • Key challenges for Supply Chain Risk Management in healthcare;
  • Lessons learned from Covid-19 on Supply Chain in healthcare; and
  • The evolving areas for Supply Chain Risk Management in healthcare.

Resources
Erika Peters Profile
Tim Stone Profile
Exiger Website
Exiger’s Supply Chain Explorer

Categories
Blog

Exiger’s Fight to Secure Supply Chains: Spotlight on Healthcare

Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 1, I visit with Erika Peters, a Senior Vice President (SVP) with close to two decades of experience working across the financial, corporate, and government industry, and focus on the firm’s supply chain and third-party risk management practices, and Tim Stone, Senior Director, Supply Chain Risk Management, for Exiger Federal Solutions. We discuss supply chain issues in the healthcare industry, including hospitals, life sciences, pharmaceuticals, medical devices, and medical services.
We began with critical supply chain risk management challenges in the healthcare industry. Peters said the “way I think about the healthcare sector and how it differentiates from the other sectors is that the ultimate risk is trying to mitigate fatalities. This means thinking about the third parties that healthcare companies must work with and then their supply chain makes it one of the most extremely critical industries to be thinking about. In the current post-pandemic era, it is one of the timeliest topics. Equally important is that if you must switch out a key vendor, the entire process can take between 12-18 months, putting your organization in a bind. This means you need to put a rigorous process in place and then follow that process.”
Stone noted key lessons learned on healthcare industry supply chain issues from the pandemic. He stated that the federal government created a Joint Acquisition Task Force in the Department of Defense (DoD) during the pandemic. This was an interagency push to source products across various pandemic-related areas like therapies, vaccines, ingredients, testing, materials and equipment, personal equipment, and even items such as no-touch thermometers. The task force illuminated dozens of product areas across those different sectors, then used market intelligence tools to identify companies in each industry. Further, they used modeling to estimate production capacity and entered information into the Exiger software product DDIQ to risk-rank based upon these and other inputs.
This led to the finding of supply chain fragility. This is because many components in the healthcare supply chain come from state-owned enterprises, and many of these are from China. Even when the team began to focus on migrating to India, it turned out that many underlying components came from China. Another problem discovered was the concentration of raw goods and manufacturers. Stone noted, “we saw otherwise obscure examples of concentration risks arise during COVID that you had never thought about before. In Malaysia, for example, we realized it was a top producer of nitro gloves that owns about 65% of the market. This led to COVID-driven disruptions, which impacted our ability to get nitro gloves. This was the way the world turned and focused on supply chains and where goods are ultimately sourced.” Just-in-time supply chains saw similar if not more disruptions as well.
We then turned to how the healthcare industry supply chain can improve its approach to managing risk. Here Peters noted there were two key areas. The first is programmatic, and the second involves a technological solution. Companies need to create a genuinely risk-based program, for instance, looking at entities that will cause an operating room to shut down or prohibit a company from getting materials required for medicines. These critical entities need to have the most in-depth due diligence; taking that strategic risk appetite and having it trickled down to the tactical level is an important way of making sure that the people at the bottom who are doing the actual work that they are hitting the right risk lens that the company wants to take.
The other piece is to have technology in place to facilitate this and that “we need to improve on that technology.” She noted, “we get to this higher level of more of a predictive posture, which is the golden standard where we need to be. We need to have these teams looking at their risk and bringing it into one view of this entity, especially these critical ones.” It looks at a wide variety of risks, from legal/regulatory to geopolitical to operational. It is doing so quickly and efficiently so the front-line supply chain professionals can make decisions for their organizations’ long-term care and health.
Stone concluded that down the road, supply chain professionals in the healthcare sector “can improve the bottom line, through greater fluidity, greater understanding of their supply chains, greater ability to on the fly to gauge the credibility of vendors, and have that due diligence information at their fingertips through technology.” It will also help avoid a lot of fraud, waste, and abuse and create a more well-oiled machine from a supply chain perspective.
Join us tomorrow when we spotlight the manufacturing and consumer markets.
Resources
Erika Peters Profile
Tim Stone Profile
Exiger Website
Exiger’s Supply Chain Explorer