The necessity for a chief supply chain risk officer to manage the enterprise's supply chain risk management plan is growing. Read on to find out why it makes sense.
Enterprises are recognising the need for a new set of C-level officers for supply chain risk management. While a formal study has yet to be released on the subject, I hope to get the concept across in this article. I will discuss the benefits of closing the gaps in the roles of three other executive positions: chief supply chain officer, supply chief robotics officer and chief risk officer (financial). For each position, I start with what the position is briefly about (from various sources) and then show the downsides of each position as compared with the chief supply chain risk officer.
Chief supply chain officer
The chief supply chain officer (CSCO), writes supply chain consultant Martin Murray, is responsible for the supply chain management of a company, which includes manufacturing operations, materials management, procurement, packaging, handling, and transportation. The officer focuses on customer experience, omnichannel commerce, demand prediction analytics and supply chain optimisation. Hans Thalbauer, senior vice president, SAP, writes that customer experience and omnichannel commerce have been the hot business topics (in supply chain).
The downside is the CSCO is most likely not experienced with risk management (cybersecurity and financial). If risks are not properly managed, demand prediction analytics will contain flaws and supply chain will not be properly optimised, for example.
Chief robotics officer
The chief robotics officer (CRO), posits Mark Bünger and Kyle Landry, will be necessary to manage (in-house) the proliferation, cost and especially integration of robotics technology in early adopter businesses. Manufacturers rely more and more on robotics (and machine vision) to automate some repetitive human activities, including the tasks of checking for the defective electronics parts on the assembly line.
The downside is the CRO is not responsible for the risk management of robotics technology in electronics supply chain commerce.
Chief risk officer
The chief risk officer focuses on cost effective governance of risks and opportunities to a business unit and/or the entire company. The officer coordinates the organization's Enterprise Risk Management (ERM) approach on identifying and mitigating risks — usually hazard, operational and strategic from the financial standpoint.
The downside is the officer may not have supply chain and cybersecurity risk management programmes in place. Often overlooked are the supply chain-related federal/international regulations that must be complied with.
Chief supply chain risk officer
Having a chief supply chain risk officer perform a broader range of tasks could close the gaps in each of the three roles. The benefits of a chief supply chain risk officer are:
Greater visibility. The chief supply chain risk officer gains a greater visibility (via a dashboard on a mobile device) on dynamic interactions between risks, robotics technologies and supply chain commerce. The officer can detect one source suppliers hidden in deep tiers and reroute the shipments in the complex transportation network with the goal of saving millions of dollars.
Global residual risk handling. The officer has a wider choice of handling residual risks globally when cost-effective safeguards cannot be implemented in the ever expanding, dynamically changing electronics supply chain commerce. Property insurance, supply chain intelligence analytics, more efficient robot process automation, and human factors (social and environmental) risk assessment are some alternatives on the officer's agenda.
Multiple regulatory compliance. The officer must establish a roadmap on complying with laws and federal regulations affecting procurement, materials management, robotics safety, trade facilitation, and risk management and other supply chain aspects. This requires planning ahead on meeting different deadline dates and document storage requirements — to avoid noncompliance penalties.