2
Figure 26: DO YOU BELIEVE THERE ARE INHERENT RISKS IN YOUR SUPPLY CHAINS?
84.1%
Yes
90.9%
12.5%
No
7.3%
3.4%
Don’t know
1.8%
0
10% 20% 30% 40% 50%
60%
70% 80%
90%
100%
Greece 2011 Global 2009
The maxim “you cannot manage what you cannot see” holds true, as most organisations have difficulties in detecting and deciphering risks. There are numerous examples of companies that have been caught by surprise by events such as the Japan tsunami and earthquake in 2011. That catastrophic event disrupted the supply chains of many companies worldwide, since a high percentage of semiconductors and other essential electronic components are manufactured in Japan. Unsurprisingly, given current economic conditions, the risk of supplier failure is seen as the top threat by 64.4% of respondents. We believe this figure underplays the real situation. Indeed, workshop participants agreed that they expected this risk to be mentioned by more organisations in the survey. The poor financial position of many suppliers is reflected in demands for shorter payment terms or even advance payment.
Figure 27: WHAT DO YOU SEE AS THE MAJOR RISKS WITHIN YOUR SUPPLY CHAIN?
64.4%
Financial failure of supplier (including an inability to obtain trade finance)
78%
52.2%
Physical incident impacting supplier facilities
42.2%
46.7%
Quality failure at supplier leading to product recall or contamination
39.4%
45.6%
Failure of service provision by outsourcing partner organisation
34.9%
43.3%
War, terrorism, or other geopolitical concerns
12.8%
37.8%
Physical incident impacting own facilities
36.7%
32.2%
Regulatory concerns
29.4%
22.2%
Counterfeited products
9.2%
21.1%
Supplier ethical standards revealed publicly as being unsatisfactory
17.4%
20%
Ligitation with supplier
13.8%
14.4%
Data security / IT incidents
30.3%
11.1%
Breach of Intellectual Property Rights
13.8%
7.8%
Pandemic
20.2%
2.2%
Other
8.3%
70%
0
10% 20% 30% 40% 50%
60%
80%
Greece 2011 Global 2009
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