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70% of Businesses Record Supply Chain Disruptions in 2010

The research, which covered 35 countries, looked into the impacts of the supply chain on business continuity. It showed that while awareness of risks ...

Freddie Pierce
|Oct 29|magazine4 min read

The research, which covered 35 countries, looked into the impacts of the supply chain on business continuity.

It showed that while awareness of risks in the supply chain is increasing, businesses remain exposed to high levels of risk.

Adverse weather conditions were found to be the main cause of disruption.

Unplanned IT and telecommunication outages was the second most likely disruption, according to 35 percent of those surveyed, up from 20 percent last year.

The failure of service provision by outsourcers was identified as the third likely disruption. The research found that outsourcing, in IT and manufacturing particularly, often reduces cost benefits through greater exposure to supply chain disruption.

As many as 20 percent of the businesses surveyed went so far as to say that their brand or reputation had suffered damage due to supply chain disruptions.

In fact, outsourcing was continually identified by organizations as having disrupted the supply chain. Those businesses that had shifted production overseas to low cost countries were more likely to be on the receiving end of disruptions. In this instance, transport networks and supplier insolvency were the main reasons for interruptions in the supply chain.

For advice on how to minimize supply chain disruptions when it comes to outsourcing, read Supply Chain Digital’s report ‘Managing Your Suppliers Successfully’.

Edited by Rebecca D'Souza