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Articles in category: Risk Management
THE latest Ernst & Young-Namibian Fraud & Corruption Landscape Survey shows that 79% of Namibian businesses view fraud and corruption as a big risk.
Executive management and risk management staff of 90 Namibian companies were surveyed for their views on fraud, bribery and corruption in Namibia and their efforts to mitigate these risks.(Read Full Article)
In 2013, 80% of supply chain leaders had a material supply chain disruption. It was not just one. The average company had three. Yet, in a study that we just completed, when asked about business pain, supply chain risk rates low. How come?
It is new. It lacks a consistent definition and set of practices. Companies reward the urgent. Risk management requires a focus on the important. It requires leadership and orchestration. Teams don’t know what to do. The companies that are the most mature learned the hard way. They had a disruption.(Read Full Article)
Three more officials have been arrested in the South African Social Security Agency's ongoing fight against fraud and corruption. The officials, who are based at the KwaMhlanga local office in Mpumalanga, were arrested during a joint operation on Thursday for defrauding the agency of a total amount of R752 460.
The joint operation is between SASSA, the SA Police Service (SAPS) and the National Prosecution Authority.
The arrest of the officials follows a report by a member of the public on 8 January 2012, who informed the agency that two beneficiaries from Verena in Mpumalanga, were receiving fraudulent disability ...(Read Full Article)
Five elements of a resilient supply chain
Supply chain managers tend to rely heavily on data to support decision-making processes. Data proves helpful in planning for risk but is insufficient in light of the massive number of scenarios that could disrupt a supply chain. Developing a plan to deal with so many unknowns requires a slightly different set of priorities. There are five key elements that distinguish a resilient supply chain:
1. Prepared: Designing a supply chain that is prepared for a catastrophic disruption involves understanding the risks, maintaining deep visibility into the supply chain resources, and developing operational readiness ...(Read Full Article)
Banks around the world, consumed with meeting more stringent capital regulations, will miss a deadline to upgrade outdated software for ATMs and face additional costs to Microsoft to keep them secure.
The US software company first warned that it was planning to end support for Windows XP in 2007, but only a third of the world’s 2.2 million ATMs that use the system will have been upgraded to a new platform, such as Windows 7, by the deadline next month, according to NCR, one of the biggest ATM makers.(Read Full Article)
What the Age of the Consumer Means to Industrial Manufacturing: A Conversation with Simon Ellis, Part II
There is no question that consumer demand is now driving the consumer goods and retail industries. But how does it impact industrial manufacturing? To get some Expert Insights on this topic, Supply Chain Nation spoke with Simon Ellis, practice director, supply chain strategies, for IDC Manufacturing Insights. In Part I of this series, Ellis discussed how consumer demand and what IDC calls the third computing platform are impacting industrial manufacturers.(Read Full Article)
Facebook’s acquisition of WhatsApp for a reported $19 billion (£11.3 billion) shows how procurement can get involved in high-risk high value projects, such as IT systems and major capital expenditure. Here are three points to inform your thinking: • Cost, price and value. The acquisition price of $19 billion has very little to do with cost because WhatsApp employs about 55 people and charges 69p in the UK for an annual service – it’s free for the first year.(Read Full Article)
Supply chain disruption moved down the list to 16th place, after being included in the top 10 concerns in last year's annual Business Continuity Institute (BCI) Horizon Scan.
This is despite increasing supply chain complexity featuring within the top five emerging trends and the fact that 75 per cent of respondents experienced at least one supply chain disruption during the previous year.
Is this a symptom of short term memory loss, because the past year has been less significant than the previous two as far as natural disasters are concerned, or has risk management really improved?(Read Full Article)
Supply chain disruption, natural catastrophes, and fires or explosions are the risks that global insurance companies are most concerned about in the coming year.
The Allianz Risk Barometer 2014 found that 43 per cent of corporate insurance experts are worried about business interruption and supply chain risk. This is down slightly from last year’s 46 per cent. Natural catastrophes (storms, floods, earthquakes) are second on the business risks list.
Due to the complexity and inter-dependencies of these megatrends and the diversity of affected countries, markets and companies it’s difficult to assess the impact on procurement but leading procurement managers foresee major changes in a couple of focal areas within the next decade.(Read Full Article)
Supply chain management has been in the news lately, and not in a favorable way. Recently, Hitachi Consulting revealed that supply chains are not a major concern for many top executives who responded to its survey, a fact that is jarring to say the least, and hopefully not indicative of management sentiment generally.
Then, there were all the reports of the horrific Bangladesh factory collapse that killed 1,100 garment workers. Those reports included one about a clothing manufacturer who claimed no responsibility for the victims. Yes, the company is part of a consortium funding safety upgrades to Bangladesh factories ...(Read Full Article)
In an unusual move, the eThekwini Municipality intends to extend its contract with a liquidated company that has been operating the city’s parking meter system. This is according to papers before the Durban High Court in an application for extended powers brought by liquidators Johannes Muller and Hussan Goga, who are handling the affairs of Emtateni Logistics.
Judge Gregory Kruger granted an order which extends the liquidators’ powers and enables them to continue the contract with the city.(Read Full Article)
A methodology for properly classifying information risk is the first rule of designing an effective supplier assurance programme. It may sound obvious but in practice not many organisations do it. Fewer still do it well. But unless your programme is based on a clear understanding of the value of the information you have stored, along with your regulatory obligations, it is very easy to end up with a one-size-fits-all approach that treats every supplier the same.(Read Full Article)
Purchasers must monitor their suppliers and build strong relationships if they want to avoid risks in procurement.
That’s the message from Jaguar Land Rover’s director of purchasing Ian Harnett, who was speaking at the ‘Resilience, sustainability, integrity and emerging trends – managing supply risk in the 21st century’ event. Harnett explained that the company looks at risk management on a regular basis because it demonstrates “certain things that you cannot ignore”. He explained that as the company has grown significantly over the past years........
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Stephen Easton, partner at A.T. Kearney, told the ProcureCon conference in Amsterdam unknown unknowns were by their nature difficult to predict but they included how laws are going to change in future, what regulations could be introduced, how global terms of trade might alter and natural disasters.
Known knowns included whether a supplier has filled in a compliance report and known unknowns included whether a supplier was complying with the law, Easton said.(Read Full Article)
It's possible to insure against most things these days, but cyber security insurance is a relatively new field and findings by NSS Labs show that it's becoming more popular. The report rounds up a number of recent surveys which put cyber insurance adoption at around one third of large US businesses.(Read Full Article)
Yet another MTN executive, head of procurement Edwin Mashilo, has been "pushed out" and will leave at the end of this month. Mr Mashilo’s departure was announced to staff on Friday. He becomes the sixth senior executive to leave the telecommunications giant in the past five months.
The list includes chief financial officer Nazir Patel, head of mergers and acquisitions and international business development Khumo Shuenyane, and group executive for business risk management and member of the tender committee Ignatius Sehoole. Another recent departure was that of Fatima Laher, while chief corporate services officer Robert Madzonga is on special ...(Read Full Article)
Today, supply chain risk is recognised as a major threat to business continuity. A break in the supply chain can reduce a company’s revenue, cut into market share, inflate costs, or threaten production and distribution. FM Global has identified three steps that organisations can take to reduce their supply chain risk: Identifying critical suppliers is the first step towards understanding your exposure to supply chain risk.(Read Full Article)
Today's dramatically changing business environment highlights the strategic importance of procurement. Until recently, procurement was a necessary, but seldom celebrated, component. But now-a-days, procurement function is playing a pivotal role in the organization's success as supplies of critical commodities have tightened and prices have risen. Procurement is now undergoing transformation as a function in itself. Age old, traditional and rudimentary concepts have shifted towards a more open, innovative and flexible focus. Expectations have also undergone a change. Companies are looking for procurement related services not just to fulfill their requirements at the lowest cost but also to enable ...(Read Full Article)
After tsunamis, protests, wildfires, and riots — to name just a few recent major disruptions — few managers can be unaware of companies' vulnerability to the vagaries of politics and extreme weather. You'd think. Yet three quarters of the 195 large companies surveyed recently by APQC got hit by an unexpected major supply chain disruption in the last 24 months. We are talking here about an unforeseen event involving a physical asset owned by the enterprise or a third party. Major means an event that has the potential to severely interrupt a business' ability to deliver on its promises to customers ...(Read Full Article)
CEO Ashley Almanza is to conduct a thorough review of the security business following a year that has seen it suffer financial and reputational damage as a result of contract problems. Almanza, who replaced previous chief executive Nick Buckles in May, announced the review days after the world’s largest security company was accused of over-charging the Ministry of Justice (MoJ) on an electronic tagging contract. In addition to this issue, the review will also look at the company's failure to deliver the contracted number of security guards for the London 2012 Olympics, which cost the company £88 million ...(Read Full Article)
Contract compliance is the ability of an organisation to insure purchase order detail accurately reflects the terms and conditions as are found in the contract detail of long term agreements (LTA’s). The reasons for entering into LTA’s with suppliers are many. LTA’s are often used for securing supply of a scarce resource from a supplier. LTA’s are also used to group a large number of common items (Commodity/Category) together to obtain purchasing leverage and thereby obtain preferential pricing over the term of the contract. LTA also facilitate closer and more stable relationships within the supply ...(Read Full Article)
As natural disasters play havoc with supply chains, procurement professionals need to know what a robust risk management process should look like. The name Eyjafjallajökull might not exactly trip off the tongue, but it is one that has been on everyone’s lips for the past few years. It is, of course, the Icelandic volcano that erupted in 2010, causing all sorts of logistical problems for both goods and people. It also alerted the whole of Europe to the issue of supply chain risk, when previously this had tended to be the preserve of risk managers and supply chain ...(Read Full Article)
Risk mitigation strategies lie at the heart of corporate governance. What is the contribution to these mitigation strategies from the procurement and supply chain management function? It is rare to find robust methodologies in place that will, in a structured way, identify the potential risks that exists in contracts with third parties. A failure to manage the risks leaves the organisation vulnerable to reputational damage, disputes, threats to service performance and diminishing profit margins. Contractual risk is one such key area. There are organisations who have not reviewed their contractual terms and conditions for many years. There are others who ...(Read Full Article)