MMH Mobile
Log In  |  Register          Subscribe to Modern Materials Handling and MHPN
Zibb
Subscribe to Modern Materials Handling and MHPN

Economy: Supply chain disruptions plague most companies

Nearly all of the companies surveyed had a supply chain disruption in the past year, with more than half suffering financial losses as a result.

By Allison Manning, Associate Editor -- Modern Materials Handling, 10/1/2008

Current level of readiness to supply chain disruptionsWhen it comes to disruptions in the supply chain, few companies can afford to ignore possible risks and hope for the best, according to a recent study by Aberdeen Group.

Nearly all, or 99%, of the companies surveyed had suffered a supply chain disruption in the past year, with 58% suffering financial losses as a result.

Viktoriya Sadlovska, lead co-author on the study, said she was struck by the number of disruptions companies reported, with almost all of the 138 checking off at least one.

The most commonly reported disruptions were:

  • Supplier capacity not meeting demand (56% of respondents)
  • Raw materials price increases or shortages (49%)
  • Unexpected changes in customer demand (45%)
  • Delayed/damaged/misdirected shipments (39%)
  • Fuel price increases or shortages (35%)

Best-in-class companies were twice as likely to suffer no major impact in the form of financial or market share loss or brand damage as a result of disruption.

“Overall, there's still a pretty big gap in supply chain risk management,” Sadlovska said.

The study identified a number of risks, including logistics congestion and capacity, risk profile of suppliers, fuel prices, risk profile of a country and non-environmental catastrophic events, and found that best-in-class companies were between 28 and 43% more likely to manage those risks.

“Fewer than a third of companies said they were actively managing any of those risks,” Sadlovska said. “That's very alarming to me.”

A disconnect across the organizations contributes to the lack of management, Sadlovska said. Even though more than a third of companies reported having an enterprise risk department, only 3% said that department was leading in managing supply chain risk management initiatives.

Talkback

We would love your feedback!

Post a comment

» VIEW ALL TALKBACK THREADS

Related Content

Related Content

 

By This Author

Sponsored Links

Reed Business Information Resource Center

Featured Company


Related Resources


 
Advertisement

More Content

  • Blogs
  • Webcasts

Blogs

  • Tom Andel
    Takeaways

    October 26, 2009
    Forklifts from space! Tell your kids.
    The worst insult you could pay a warehouse manager is that his facility is a black hole. That implies a huge cosmic point of no return. Well if log......
    More
  • Tom Andel
    Takeaways

    October 5, 2009
    Whirlpool raises its lift truck IQ
    In a recent blog I let off some steam about people who have no right to be lift-truck-ignorant. I’m sorry if I came off as a petulant snob. B......
    More
  • View All BlogsRSS
Advertisements





MODERN MATERIALS HANDLING NEWSLETTERS

This Week in Modern
Modern Best Practices
Modern Product Showcase
Modern Technology Trends
Modern Early Edition
MHPN Product Alert
MHPN Product Showcase
Please read our Privacy Policy
About Us   |   Contact Us   |   Advertising Info   |   Site Map   |   FREE Subscriptions   ||   RSS
© 2009 Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.
Use of this Web site is subject to its Terms of Use | Privacy Policy
Please visit these other Reed Business sites