In the age of global commerce, gauging supply chain risk is the business world’s version of playing “six degrees of Kevin Bacon.”
If it’s a truism that all people in Hollywood are only a few film credits away from the Footloose star, it’s not a stretch to say that all companies — buyers and suppliers — are linked as well, in one way or another, no matter where they are or what they do.
The challenge for companies is to understand where risks lie, especially across borders.
“A lot of things that are breaking down in the world are at the network level, not at the buyer-supplier relationship level,” Altana Technologies CEO Evan Smith told Karen Webster.
It’s that sixth or seventh degree of separation that winds up causing the seismic shift, and it’s located and lurking somewhere upstream in the supply chain.
Well beyond the challenges of COVID, enterprises, logistic providers and governments also must monitor the changing risks and disruptions — environmental and geopolitical — that can bring trade to a standstill or even make sourcing goods difficult in the first place. Regulations and import bans are fluid.