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Supplier Risk Management

Anticipate and respond to supply chain risks at speed and scale

Organizations have historically focused supply chain investments around a “just-in-time” philosophy. But in today’s global marketplace, with increasingly complex supply networks and risks that need to be mitigated and managed, organizations that develop both resilience and agility are best suited for success. Deloitte’s Supplier Risk Management solutions can help organizations gain better supply chain visibility and effectively counter disruptions.

Driving supply assurance in a risky world

For procurement leaders, the pursuit of cost savings is often thwarted by supplier risks that can proliferate along the way. Between global public health crises, economic uncertainty, geopolitical conflicts, and natural disasters, supply chain disruptions have a real impact on the bottom line. To minimize losses, supply chain leaders must take steps to build capabilities that can help their organizations anticipate, sense, and respond to unexpected changes. To maximize gains, they must build connected, digital supply networks that can evolve alongside shifting business priorities.

But many organizations have a long way to go when it comes to proactively managing supplier risk. In our 2021 Chief Procurement Officer (CPO) Survey, enhancing risk management was only the sixth highest priority for responding CPOs—a measure that’s barely changed since 2019. On top of that, the reported supply chain challenges from 2020 were substantial:

  • 70% of CPOs said they have good visibility into their direct supplier base
  • 52% said they are not using supplier risk management tools for supplier collaboration
  • 26% were able to confidently predict risks within that direct supplier base
  • 15% had visibility to tier 2 and beyond

Many organizations desire multitier supply chain visibility, but face challenges in achieving true transparency into their immediate first-tier suppliers. They often struggle to answer questions such as these:

  • Where are the critical nodes and commodities?
  • Are all suppliers financially solvent?
  • Is the enterprise diversified enough to withstand shocks to the supply network?

The key to gaining a more comprehensive view of supplier risks relies on interconnected digital tools, physical infrastructure, and corresponding data streams. Trustworthy data can help provide better supply chain visibility and help leaders identify risk exposure. With this foresight, organizations can proactively respond to emerging threats in an effective, cost-friendly manner.

Why Deloitte?

With supply chain risk management engagements for some of the world’s largest and most complex enterprises, we know what best-in-class looks like and how to take you there. With mastery in technology implementation and supply chains, we can help you avoid potential pitfalls in transformation, seize opportunities, and quickly mature your organization’s supplier risk management capabilities.

Supplier Risk Management offerings in action

Building supply network resilience and agility with data, tools, and technology

Deloitte’s Supplier Risk Management solutions can help your organization build more trustworthy supply chain data and establish the full picture of your potential supply chain risks. Through a combination of our technological assets and a deep understanding of both supply chains and industry trends, we can help model supplier networks, sense risks in real time, and take prescriptive actions based on simulated outcomes. Successfully managing risks across modern supply chains requires organizations to:

You can only manage what you can see. To map your supply chain, we use tools and accelerators developed by working with the Department of Defense for more than 20 years, an organization with one of the most sensitive and secure supply chains in the world. We use 1,400+ internal, open source, and third-party purchased data sources to look beyond tier 1 suppliers and help you capture a holistic view of your network. With more than 4.2 million supplier records mapped with corresponding risk profiles, we help you reveal critical nodes, dependable alternatives, risks, and their potential consequences. Our solutions have been used to deliver 80+ projects across industries.

Risk management is only as strong as the data behind it. We can position your enterprise to identify and assess core operational risks by integrating siloed systems and data. Using risk-scoring algorithms, we can help reveal your potential operational risks and deepen your understanding of supplier capacity, delivery performance, quality and qualifications, financial visibility, and more.

Meanwhile, we draw from dozens of proprietary and third-party data sets using cognitive technologies and machine learning to help reveal risks, from geographic to regulatory and beyond. By combining your operational risks with relevant external indicators, we can help detect nearly real-time changes in your risk profile.

Our solutions can empower your enterprise to respond strategically to emerging or changing supplier risks. Our risk alerts and data visualizations enable key stakeholders, including purchasing, planning, manufacturing, and more to understand the risk indicators, run scenarios, analyze potential impacts on supply, and determine the best mitigatory actions.

We bring a proven approach tailored to your business priorities to enable process efficiency, proactive risk awareness and mitigation, and value for the enterprise.

Our approach includes:

  • Ecosystem accelerators: We bring numerous assets and accelerators to enhance and expedite the collection, integration, harmonization, and analysis of data from both internal and external sources, including millions of supplier records, thousands of third-party data sources, and data management and system integration alliances
  • Conceptual architecture: Bespoke architecture using technology components based on your unique business requirements and technology strategy
  • Data collection: Proprietary frameworks, methodologies, models, and solutions that draw from internal and external data sources
  • Decision support and accelerators: Prebuilt, proprietary solutions and leading-class third-party technologies that permit advanced analytics, data visualization, and external collaboration

Leveraging leading-edge technology to enhance efficiency, effectiveness, and speed throughout the architecture, we help you chart a proven path forward. Our supply chain risk management maturity models enable you to reach best-in-class architecture that permits supply chain visibility and agile risk management.

A global leader in building operational resilience and agility

  • A leader in Data and Analytics Service Providers, Magic Quadrant, 2021 by Gartner1
  • A leader in Enterprise Insights Service Providers, Q2 2020 in The Forrester Wave™2
  • A global leader in Procurement Operations Consulting, 2020 by ALM Intelligence3
  • A global leader in Business Analytics Consulting and Systems Integration Services, 2020 by IDC4
  • A global leader in Cybersecurity Consulting, 2019 by ALM5

Ready to make it happen?

We know how to quickly take you to a state where risk is actively managed, opportunities are seized, and supply is assured. Reach out today to discuss your vision for building more resilient, agile supply networks.

Endnotes

1 Jorgen Heizenberg, Twiggy Lo, Gareth Herschel, Divya Radhakrishnan and Shubhangi Vashisth, “Magic Quadrant for Data and Analytics Service Providers,” Gartner, February 15, 2020.
2 Jennifer Belissent, “Forrester Wave™: Enterprise Insights Service Providers Q2 2020,” Forrester Research, June 8, 2020.
3 ALM Intelligence, “Procurement Operations Consulting 2020”; ALM Intelligence estimates © 2020 ALM Media Properties, LLC. Reproduced under license.
4 Jennifer Hamel, “Worldwide Business Analytics Consulting and Systems Integration Services 2020 Vendor Assessment,” IDC MarketScape, June 2020.
5 ALM Intelligence: “Cybersecurity Consulting 2019”; ALM Intelligence estimates © 2019 ALM Media Properties, LLC. Reproduced under license.