Whilst company boards are legally required to consider principal risks and publish the results, we have found that this is often compliance-focussed, rather than practical and action-orientated.
Once legal and fiduciary responsibilities have been satisfied – what then?
We focus on supply base resilience – the management of risk driven by processes or interactions with suppliers. These risks can threaten a business commercially, reputationally and ethically. It is not uncommon for our work to uncover existential risks to a business, sitting unmanaged within the supply base.
At Ivo, we believe that managing risk means practical, everyday actions rather than an annual exercise in corporate box-ticking.
AREAS OF RISK TO YOU:
SOURCING STRATEGY FOR GOODS AND SERVICES
SUPPLIER AGREEMENTS CONTRACTS
THE CHOICE OF SINGLE VS MULTIPLE SOURCES OF SUPPLY
LACK OF FEASIBLE CONTINGENCY OPTIONS
INTERNAL TEAMS AND SUPPLIER RELATIONSHIPS
CRITICAL INFORMATION STORAGE AND MANAGEMENT
HOW WE WORK
In developing our approach for evaluating, scoring and prioritising supply base risk, we looked to the engineering world, where rigorous testing of systems for potential points of failure is critical.
We use failure modes and effects analysis (FMEA) to identify hidden risks and create a prioritised list of issues.
This methodical and data-driven process allows us to quickly establish an understanding of your business, your suppliers and identify underlying issues.
HOW CAN WE HELP YOU?
We work with your internal teams to explore the following risk questions:
What level of risk currently sits within the supply base?
Are there any verticalisation or M&A targets that would help mitigate risks?
Given a more holistic evaluation, who are your truly important suppliers (not just the biggest…)?
Are there suppliers that receive disproportionate levels of resource and attention?
Which smaller suppliers are critical to your operations? Why are they critical? How should the situation be managed?
How could you reduce dependence on certain suppliers and develop alternatives?
What processes and ways of working would help to maintain good supply base resilience in your business?
PRACTICAL ACTIONS
Sourcing Activity | Contract Negotiations | Supplier Research | Tracking Risk Levels | Develop New ‘risk resistant’ Internal Processes
