Depending on objective, there are several risk evaluation approaches to consider
Objective:
Holistic view of the overall supply chain risk profile and a relative risk prioritization across the enterprise. Typically serves as the foundation for an enterprise-wide program that can be further scaled by individual BUs.
Enterprise Assessment (Portfolio-wide)
Methodology:
Benefits:
• Informs broader ERM framework, governance, and operating model
• Helps identify common risks, dependencies, and vulnerabilities
• Enables effective resource allocation and development of risk mitigation strategies that address critical risks affecting multiple BU's
Considerations:
• Focuses on enterprise risk mitigation v. unique BU/supplier risks
• Less precision to existing risk mitigations or treatments
• May not fully capture acute industry or supplier/supply market risks
Discovery/ mobilization
Risk assessment
Prioritization & mitigation
Risk identification
Objective:
Focused on deeper, more detailed diligence of known risk areas. Typically focuses on BUs with existing management programs to further quantify or treat high-risk exposures, and may form the foundation of a framework to be leveraged across the portfolio.
Methodology:
Benefits:
• In-depth analysis allows for a deeper understanding of specific supply chain risks that may be scaled to other BUs with similar profile
• Risk-based approach to focus resources to higher impact areas
• Quick response to acute/BU specific supply chain risks
Considerations:
• Limited perspective to overall enterprise risk profile
• May result in unequal or biased risk treatment across enterprise
• May miss unknown risks and best practices that exist across the enterprise/portfolio
Targeted Assessment (BU-level)
Scoping & targeting
Risk identification
Risk analysis & Evaluation
Detailed discovery
Prioritization & Scaling