The Manufacturing Industry has previously focused on:
- Implementing a reduction policy of its intermediate stocks and finished products in order to decrease its Working Capital;
- Grouping its Production Plants in order to reduce structural costs and “utilities”;
- Sub-contracting its entire Supply Chain in order to reduce costs in an increasingly complex and global context;
- Asking its Purchasers to unify and globalize their purchasing by reducing the number of suppliers and increasing the volumes purchased from lower-priced suppliers without taking into account the supply constraints of these same suppliers.
- Streamlining Products and / or analyzing customers (usually representing about 80% to 90% of the scope of their concerns) as well as short-term optimization of Production and Supply Chain
What the Covid-19 crisis reveals is the fragility of this type of structure when an unforeseen event (like the Covid-19, an industrial accident or a climatic event) generates a chain reaction of internal and/or external system failures.
Once the emergencies of such an event have been dealt with (i.e. Team safety, Supply Chain adjustment and the rapid adaptation of production – downwards and upwards), it is vital to analyze all critical products and processes, namely Purchasing, Production and Sales, to reduce the risk of reoccurrence.
For instance, every company should have at minima:
- An internal definition of what “Critical Products” mean for their business
- A list of the 20 most Critical Products for the proper functioning of their production
This study must be considered as vital as the resolution of original emergencies. It is key to reducing possible dysfunctions, risks of failure or upcoming damages – their criticality and their consequences – which will occur in increasingly short periods of time in the coming years.
In this context, and drawing on 20 years of experience and expertise in the Industries areas, some of us having spent years in industrial organizations, we sought what could help our clients to have a clearer and more effective vision of their situation. From this thinking, we created a new study method based on the same rigor as our traditional D-Method: the Risk Mitigation Preliminary Analysis.
Risk Mitigation Preliminary Analysis
With this Analysis combining 20 Questions and Best Practices Rankings, we can efficiently assist you in assessing your risk related to Sourcing, Production, Supply Chain and Sales. Our study is based on interviews within your organization and possible ideation workshops, scrutinizing the critical path of your whole process resulting in a quick but complete vision of your Risks from Sourcing to Sales.
With this Preliminary Analysis, we can help you to fully pinpoint the weaknesses of your Operations and take the necessary actions to develop a Risk Mitigation Plan to strengthen your Supply Chain, Procurement and Sales against future unforeseen events.
Please let us know if you are interested in learning more about it, and we will be glad to share how we could work on it together.