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Krannert’s Global Supply Chain Business Continuity Planning Discussion

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Presentation on theme: "Krannert’s Global Supply Chain Business Continuity Planning Discussion"— Presentation transcript:

1 Krannert’s Global Supply Chain Business Continuity Planning Discussion

2 Gary Henriott, Chairman Henriott Group, Inc. Lafayette, Indiana
1972 graduate from Krannert School of Management 44 years in Insurance & Risk Management CPCU Designation

3 What’s your organization’s position in the supply chain?
Incoming Their goods, service & expertise Outgoing Your goods, services & expertise *Both positions entail risk *Both positions must be managed

4 “So….what could POSSIBLY go wrong?”
“Just about ANYTHING imaginable…..”

5 Our Risk Management Process in the Supply Chain
Step #1 Profile your supply base through review of capacity, providers, trade etc… Step #2 Assess your vulnerability Step #3 Evaluate your Risk Management options Step #4 Decide and Implement Step #5 Monitor Results Step #6 Obtain Management Support

6 Looks like a lot of work. So why is this import? Time... Resources…
Talent... So why is this import?

7 Possible Negative Impacts of Poor Supply Chain Risk Management
Loss of Business Poor Quality (expensive field fixes or service) Impact on Workforce Morale Financial Impact of Non-Performance Reputational Impact

8

9 STEP #1: Profiling Your Organizations Supply Chain
Identify Relationships Map or Flow Chart Processes Determine Where Raw Materials, Components or External Services Come From?

10 STEP #1: Profile and Assess Sources & Suppliers
Profiling Considerations: External Factors Geographic limitations Transportation channels involved in distributing your product Providers available to source your raw materials and supplies Internal Factors Using the “just in time” manufacturing process Inventoried product / raw materials Employee skill availability Capacity to manufacture with disruption

11 STEP #2: Assess Vulnerabilities & Dependence Upon Others
Use an analytical tool to map your exposure to loss, based upon frequency & severity.

12 STEP #2: Transfer Risk

13 STEP #2: Supplier Evaluation Criteria
History Quality Capacity Dependability Financial Strength Workforce Location Their R/M Program

14 STEP #3: Evaluate Risk Management Options
Step #1 is really important – you can only manage the exposures you’ve identified Retain Mitigate or Control Multiple Sources Sample/Test Every Batch Transfer the Risk Contractual Insurance Other Financial Arrangements

15 STEP 4: Decide and Implement
For each exposure, what’s the best option? Who will implement? You must have their buy-in. Justify cost/benefit Organizational criteria or constraints

16 STEP #5: Monitor Results & Effectiveness
Continuous process Change is constant Communication between departments (i.e. purchasing, engineering, logistics, etc.)

17 STEP #6: Obtain Management Support
How do you make supply chain risk management tangible? A priority? How will the effort be funded & sustained?

18 Insurance Resources Property Business Interruption & Disaster Planning
Dependent/Contingent Business Data Transportation Liability Coverages Design & Errors and Omissions Exposures Product Recall Expense Cyber & Privacy Coverages Intellectual Property Directors & Officers Crime

19 Gary Henriott, Chairman
Henriott Group, Inc.


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