Before I even begin my notes, let me just point out that if you are not a member of the Next Level Purchasing Association, you are missing out. Next Level Purchasing offers the SPSM (Senior Professional in Supply Management) certification program. Joining the association is absolutely free and comes with a number of benefits, such as members-only webinars, newsletters, and networking opportunities. If you want to get your feet wet with the kind of programs they offer, there are several mini-courses they offer, completely online and for less than $20! Interested? Good for you! Click here to learn more by clicking on the NLP logo on our partner page. That way Buyers Meeting Point gets credit for your purchase and a portion of the proceeds go to charity.

Japan Supply ChainThe speaker on 'A Case Study for Proactive Supply Chain Management' was Catherine Herr, a Senior Director of Global Manufacturing Procurement at a Fortune 500 Company. Her presentation centered around that company’s response to the March 2010 earthquake and tsunami in Japan. What captured me immediately about this webinar is that she told us the STORY of the disaster and the outcome and responses rather than just walking us through bullet points on a slide.

To give you some of the factual basics, her company’s annual risk assessment ranks suppliers high, medium or low on nine areas of risk. These areas were put together by a cross functional team that involved both procurement and business owners:

  1. Historical Performance
  2. Financial Health
  3. Country of Operation (Political, Economic, Financial)
  4. Legal Compliance
  5. Business Concentration
  6. Quality Compliance
  7. Social Responsibility (Labor/Ethics/Management)
  8. Health, Safety & Environment
  9. Intellectual Property Protection

When they started managing risk they did not involve suppliers for fear of revealing how immature their program was. They have now reached a place where suppliers are routinely asked to participate in risk mitigation planning during review meetings.

Catherine’s advice on starting a risk management program? Just pick somewhere and start, because as overwhelming as it may seem, anything is better than nothing. Aim for something “accessible and understandable” and keep everything in perspective (for example, she offered up that lost sales are more expensive than lost inventory).


So what well and what went poorly in their response to the Japanese tsunami?

On the positive side:

But, on the other hand:


For more information on Charles Dominick, Next Level Purchasing, or the SPSM Certification, click here.