After interviewing 70 leading companies, the UN Global Compact and EY found that companies are overcoming supply chain transparency challenges by leveraging supply chain platforms.
The UN Global Compact and Ernst & Young recently released the report “The State of Global Supply Chains,” in which they conducted interviews with 70 leading companies pertaining to their supply chain transparency practices. The report revealed that the most widely reported challenge for companies is in achieving supply chain transparency beyond the first tier of suppliers. The sheer number of suppliers and subcontractors within a supply chain creates a significant challenge for companies pursuing complete transparency. Starting with Tier 2, suppliers include a myriad of subcontractors, mines, smelters, mills, and farms, to name a few. It is in these lower networks of tiers where real risks such as corruption and human trafficking lie, due to gaps in monitoring and oversight.
Leading companies are examining how they can improve supplier performance beyond the first tier as a way of mitigating risk. Some companies are implementing new practices such as requiring suppliers to join a data management platform that consolidates and monitors audit-ready supplier data. Other companies are requiring suppliers to implement terms and conditions, such as corporate policies pertaining to environment, social responsibility, and anti-corruption. Suppliers are also being encouraged to join international organizations such as the UN Global Compact, and in some cases are required to report progress on implementing the organization’s guiding principles. Platforms can make tracking the implementation process much easier.
The increasing popularity of mobile technology and cloud-based solutions has created a boom in the supply chain technology solutions market. Leading companies are utilizing these solutions in order to increase visibility, collaboration and communication with suppliers. Platforms can also serve as a protected channel between internal systems and external suppliers, supporting data points such as financial information and supplier performance. These technologies are allowing supply chain managers to get a better vantage point of supply chain characteristics, performance and how to better mitigate risks. The Global Compact report also revealed a trend that solutions are moving from data collection toward supplier verification, communication and visualization of supplier inputs. Platform solutions serve as a single, consolidated source of verified supply chain information. After suppliers have inputted information based on customer requests, supply chain managers can then log onto the solution provider’s platform and cross-reference verified supplier data.
Source Intelligence provides both enterprise and supplier-size companies a platform that makes mapping, managing and minimizing supply chain risk as easy as 1, 2, 3. The platform is built to help companies tackle the enforcement of regulatory compliance and supplier assessments throughout the supply chain. If you’d like to sit back and let Source Intelligence handle the complex world of supply chain risk mitigation, get started by requesting a demo.