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Daily Insurance Industry News
Thursday 18th of January 2018
October 28, 2010

BCI highlights supply chain risks

by Gill Montia

Story link: BCI highlights supply chain risks

The Business Continuity Institute (BCI) has been updating its research on supply chain issues and their impact on businesses, to find that while awareness of supply chain risks is increasing, many businesses remain exposed to high levels of risk.

The study also concludes that outsourcing, in particular in IT and manufacturing, often ultimately reduces cost-benefits through greater exposure to supply chain disruption.

Having researched firms in 35 countries, the BCI found that over 70% of organisations recorded at least one supply chain disruption in 2010; further findings include:

Adverse weather was the main cause of disruption around the world, with 53% of firms citing this, up from 29% last year.

Unplanned IT and telecommunication outages took second place as the most likely disruption and failure of service provision by outsourcers third, with these incidents leading to a loss of productivity for over half of businesses questioned.

Twenty per cent of firms surveyed admitted they had suffered damage to their brand or reputation as a result of supply chain disruptions.

Where businesses have shifted production to low cost countries they are significantly more likely to experience supply chain disruptions, with 83% reporting disruption.

The main causes were transport networks and supplier insolvency.

 

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