Reduce Risk and Minimize Potential Recalls

There are multiple examples of how organizations have been impacted by not understanding their supply chain’s extended supply chain. A study  identified a number of producers that had unacceptable levels of lead paint in their products. Outside of safety concerns, organizations that understand their extended supply chain can gain significant insight into how to manage their overall risk of recalls and their financial implications

Identify Product Availability Risk

At a Supply Chain Planning event, a prominent wireless carrier identified a key issue in their supply chain. All of the products that they were selling had issues with power supplies, i.e. the external device that was connected to a wall. After performing an extensive extended supply chain audit, they identified that all of the power suppliers were coming from one of two vendors. These vendors were unable to keep pace with the market demands, limiting this carrier’s ability to sell their devices.

By identifying this risk, the carrier changed its specification to allow a broader range of suppliers, enabling them to improve their ability to receive and sell their products.

Supplier Quality

The quality of a product is only as good as its weakest supplier.

The study referenced above identified a key risk supplier quality risk in the supply chain. These quality issues can dramatically impact a brand, especially with products that the manufacturer passes through or does not change in its production processes.

Identifying potential extended supply chain issues provides insight into two key issues. The first is the direct supplier’s ability to identify and resolve these issues before it affects your product. The second is proactively ensuring that these key supply chain partners are aligned with your direct supplier’s quality program. For regulated industries such as automotive, aerospace and medical devices, these extended supplier relationships can make a big difference in product cost and product availability.

A recent client engagement found that what they thought was a direct relationship turned out to be a two tier system. Auditing the supplier earlier in its relationship would have avoided this misunderstanding and provided key insights to mitigate ongoing risks.

Improved Innovation and Collaboration

Understanding the extended supply chain fosters stronger relationships and collaboration with suppliers and partners. From an innovation perspective, the institutional knowledge that the extended supply chain offers enables improved innovation based on the entire supply chain’s experience delivering products to meet market needs.

Improved communication, which minimizes errors and ensures alignment on production goals. Improved collaboration also increases responsiveness to market trends by synchronizing production, distribution and logistics efforts to ensure that the end manufacturer meets its market’s product delivery commitments.

Let us know if we can assist you to help you become more familiar with your extended supply chain partners.

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