Speaker 1: And our presentation is about risk management in a supply chain. So, what is risk management in a supply chain? Risk management and supply chain management are very intertwined. Together, they create a balance where companies are able to prevent and manage issues as they occur. Risk management is the implementation of strategies to manage both everyday and extreme risks along the supply chain based on continuous risk assessment with the goal of reducing vulnerability and ensuring continuity. Here's a video that dives deeper into the definition of risk management in supply chains.

Speaker 2: Supply Chain Risk Management Supply chain risk management is the process of taking the necessary steps to identify, assess, and mitigate the risks of an organization's supply chain. Implementing a sound supply chain risk management strategy can help a firm operate more efficiently to reduce costs and enhance customer service. Supply chain management refers to how organizations manage the flow of their goods, including all the processes involved in transforming raw materials into finished products. Supply chain management includes the planning and managing of the activities around sourcing, procurement, and conversion and a LL the logistics management functions. Good supply chain risk management enhances a firm's operations. The purpose of risk management is to prevent issues and provide loss mitigation if the risk eventually occurs. A significant reason why companies implement global supply chain management strategies is to boost their competitive advantage. Sound supply chains can assist a business to improve the quality of risk, safety, business continuity, and reputation. The benefits of supply chain risk management include 1. Creating a strategic competitive advantage by promoting an agile supply chain. 2. Outperforming competitors are affected by the same shared risks, thus boosting market share when a common risk occurs. 3. Supporting optimal supply chain design by reducing uncertainty and strengthening relationships and trust to reduce risk. 4. Continually detecting, optimizing, and reducing risk exposure and cost compared to competing for supply chains. 5. Operating and continually improving a resilient supply chain. 6. Safeguards the image of a company and improves customers' satisfaction. 7. Enabling organizational self-assessment and certification against international standards to meet safety rules and regulations. Importance of Supply Chain Risk Management Supply chain risk management is an essential subset of enterprise risk management, ERM. It focuses on implementing strategies to continuously manage daily and infrequent risks along the supply chain to reduce vulnerability and ensure continuity if risks occur. Supply chain risk management attempts to reduce supply chain vulnerability through a coordinated and collaborative approach involving all stakeholders, including subcontractors. The supply chain risk management system identifies and analyzes the critical failure points within the supply chain. Mitigation plans are implemented to ensure supply chain continuity in a scenario that otherwise would have interrupted regular business. The supply chain environment is monitored for risk events and their consequences. Using a risk-based approach prioritizes events based on their frequency and consequences. It promotes the identification of tangible improvements that reduce operational, financial, and reputational risks while meeting the needs of customers and end-users. The approach taken needs to recognize that each organization is different and has competing needs and priorities driven by cost, risk, efficiency, and competitiveness. A secondary objective of supply chain risk management is to mitigate financial and reputational risks and increase value within the supply chain through improved performance.

Speaker 1: Supply chains alone are a tricky concept. There are many factors at play within them, such as manufacturers, retailers, and most importantly, customers. With all these factors comes large amounts of risk associated with each one. Risk management in the supply chain is one of the most important things companies need to address while they are beginning to work on their supply chains. Without risk management, a company can utterly and catastrophically fail. They need to plan and encourage workers to be comfortable in uncomfortable situations. With this, they can survive a downfall of their supply chain and begin to recover. Implementing ways and strategies to manage risk while it is occurring allows for major issues to never occur. Risk management in a supply chain has many layers, and we will begin to discuss them all now.

Speaker 3: Internal risks are problems that arise from within a company. These problems usually lead to the operation of the company to collapse. Employees not doing their job efficiently or correctly can lead to internal problems. Employees not doing their work correctly can lead to non-quality products, which will make the customer unsatisfied and the company losing equity. The main way to ensure that the employees are doing their job and operations are running smoothly is through management. It is management's job to communicate to employees the goals of the company, as well as teaching them what needs to be done. Internal risks are variables that can be controlled. That is why it is so important that these operations are running smoothly. Another internal risk is the equipment throughout the facilities. Faulty equipment can lead to machines breaking down, which you will need to repair. It can also lead to non-quality products, which will lead customers unsatisfied and can even lead to injuries. Equipment malfunctions can lead to companies losing money from customers. Another way companies can prevent internal risks is by investing internally, and thus losing equity directly. Their internal equipment could be damaged or get non-quality products that are damaged through the process of repair. all of their softwares and equipment are modernized and up to date. Equipment malfunctions can lead to companies losing money from customers. Another way companies can prevent internal risk is by investing in long-term assets. This will ensure that the company is not falling behind of its competitors. In business, it is vital that you are always striving to improve these operations so that you are always staying ahead of your competitors. Another internal risk is ensuring the company is operating legally. Poor management can lead to a company breaking law. For example, managers telling accountants to lie about company earnings. All of these factors contribute to the

Speaker 4: operations and success of the company. External risk and supply chain fall out of the control of the company and therefore these risks are more difficult to predict. They often require additional resources to overcome and to deal with them effectively. Some examples of these include governmental or regulatory actions or a change in currency rates that could affect the value of an international trade. Here are some more examples of external risk and supply chain. One is unpredictable consumer demand, interruptions to the flow of products which include raw materials, parts and finished goods, social, governmental and economic factors, concerns related to a supplier's physical facility and regulatory compliance, and natural disasters.

Speaker 5: A supply chain connects a firm to the rest of the world, supplying the raw materials, completed products and services to promote your products and services. It has also been critical to the development and growth of a successful firm. However, in today's market, which is categorized by more powerful distributors and dangerous hazards than ever before, effective risk mitigation procedures are crucial for safeguarding both businesses, continuing the short-term and competitive advantage growth and probability in the long run. Understanding the risks that threaten your supply chain and using the best strategies in your supply chain risk management can help you avoid risk events in your global supply chain. Some of these strategies are prioritize contingency planning, invest in new technology and manage environmental risk in the supply chain. Effective supply chain risk management is as much about mitigation as it is prevention. Protecting your company's ability to maintain operations as well as the services and workflows that support production against supply chain distributors is where supply chain risk management intersects with business contingency planning. A comprehensive risk assessment is the first step. Identifying all the internal and external risks that could contribute to or create failure points in your supply chain or operations provide the context you need to create protocols and contingencies for mitigating or even eliminating them. The PPR risk management model is a popular global supply chain risk management strategy and is used by businesses around the world. The PPR stands for P, prevention, take precautionary measures for supply chain risk mitigation, preparedness, develop and implement a contingency plan in case of an emergency, R, response, execute on your contingency plan in order to reduce the impact of the disruptive event, R, recovery, resume operations and get things running at normal capacity as quickly as possible. Your business contingency planning should include multiple contingency plans prioritized by risk, severity and likelihood. Artificial intelligence and advanced analytics must be used in conjunction with human ingenuity to manage supply chain risk in the digital age. To manage your supply chain and the risks associated with it most effectively and accurately, you need a centralized cloud-based data management system enhanced by technologies such as robotic process automation and machine learning based analytics. By implementing a comprehensive procurement solution that includes dedicated supply chain inventory and supplier relationship management modules, you can provide your procurement team with the digital tools to collect, manage and analyze spending effectively and supply data. According to McKinsey & Company, organizations that implement AI improve logistics costs by 15%, inventory levels by 35% and service levels by 65%. AI can reduce costs and minimize supply chain challenges by driving more informed choices across all aspects of supply chain management. The COVID-19 pandemic has severely disrupted the global economy and affected us on all global scale. Shipping is a primary industry for almost all countries globally and serves as an integral part of supply chain for most industries. During a pandemic like this, we are absolutely dependent on the shipping industry to transport food, medicine and other necessities across borders. The shipping industry is absolutely dependent on production output to secure cargoes. With a significantly reduced workforce, retailers struggle to process and get shipments out on time and there were questions of whether certain shipments would need to undergo quarantine before they could be delivered. As a result, some retailers decided to move from a single-sourcing to a multi-sourcing model, which would provide a much more efficient and cost-effective way to which would provide them with the contingency plan should their primary supplies become unavailable. Others opted to change their business model entirely in order to adapt to drastic changes in product seasonality and viability. A few strategies for improving supply chain resiliency are multi-source near store, stress testing often and build buffers for inventory. Multi-sourcing is a practice of working with more than one service provider or manufacturer to fulfill demand. Near shore outsourcing is the practice of getting work done or services performed by people in neighboring countries rather than an organization or country. Stress testing is comprehensive and reoccurring. Stress tests are the best way to check for vulnerabilities some which may lie hidden deep within the supply chain.

Speaker 1: Through our presentation, we have discussed several factors within and outside of companies that cause risk in supply chains. Internal risks are just as prominent as ones that we find externally. Internal risks include problems companies may face within them. While we have specifically said that external risks can be events that no one can plan for, COVID-19 served as a great example for this. Luckily, we have introduced several ways to manage risks that may occur within a supply chain that companies implement every day to protect themselves and their customers. We specifically touched on the four types of risk mitigation, which include avoiding risk, minimizing risk, transferring risk, and accepting risk. The PPRR risk management model is also a very important factor. This model addresses how to prevent, prepare, respond, and recover to and from risk factors in a supply chain. New technologies have also shown how valuable they can be to businesses in addressing risk. The use of artificial intelligence in robots has widely been used by several companies for risk management reasons. As technology continues to grow around us, new ways to combat issues are available to businesses everywhere. Through delicate planning and heavy prevention methods, risk management in supply chains is essential to the survival of a company.