Proactive planning prevents multiple failures every year
A multimillion-dollar equipment manufacturer had multiple catastrophic, supplier-driven shortages that greatly impacted sales and resulted in lost production and expediting fees. Much of the supply base was in best-cost countries, was single-sourced, or involved tooling, which added more complexities to an already fraught situation.
To prevent this in the future, our team worked to risk-rate the supply base and implement viability monitoring best practices. First, we mobilized an executive-led team to prepare for a rapid response. We evaluated the supply base to identify and monitor the most critical suppliers and classified 300 of 2,500-plus suppliers as critical and at risk. Following deeper review, we worked with the company to implement sustainable supplier management and related governance structures. For the riskiest suppliers, we also developed detailed supplier contingency plans. Based on this review, the company proactively circumvented multiple supply-based failures every year and built detailed contingency plans for an additional 60-plus suppliers.