A new tool can help companies identify and mitigate the risks of suppliers defaulting
Citicus has extended a risk management tool to include services to help organisations cope with supply chain risk issues.
Citicus ONE is designed to enable organisations to assess, manage and minimise the risks associated with critical suppliers.
Simon Oxley, managing director of Citicus, explained: ‘The volatile economic climate is creating a boom in supplier failures, presenting increased risk for organisations that outsource. The impact of supplier failure on organisations can be devastating - resulting in loss of customer service, reputational damage and lost revenue.’
Maintaining a current view of the operational and financial position of suppliers and identifying potential threats is a major challenge, he said.
“Maintaining a current view of the operational and financial position of suppliers and identifying potential threats is a major challenge.
The tool employs criticality assessments, risk scorecards and incident assessments to measure supplier risk in business terms.
Marco Kapp, who led development of the tool explained: ‘The risk posed by a major supplier can be divided into a series of localized evaluations, and results aggregated to provide an overall picture of risk.’
With the information provided organisations can identify and assess controls that need to be implemented to drive supplier risk down, he said.
Incidents associated with suppliers and services can be tracked and their business impact assessed, added Kapp.