Supply chain risk management strategies are gaining more attention these days. Companies are trying to keep better track of suppliers or outsourced parts of a supply chain to mitigate risks. But there's one area of supply chain risk assessment that's often overlooked.
The deterioration of supply chain management software presents a significant risk to operations, according to Bristlecone, a supply chain consulting firm based in Milpitas, Calif. that specializes in SAP.
Supply and demand planning software relies on advanced statistical modeling to generate accurate plans. But the underlying assumptions on which the algorithms that control the models change as the company changes. If these algorithms aren't updated on a regular basis, the forecast accuracy of these systems will decline, according to Bristlecone.
In this podcast, Anil Gupta, vice president of marketing for Bristlecone, explains the root of the problem, some of its consequences and how to fix it.
|Managing risk in SCM software|
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- 00:45: What are the major causes of supply chain system risk?
- 2:48: How common is this problem?
- 3:54: How can you figure out whether there's a problem in your SCM system?
- 4:52: What are some of the consequences of ignoring this problem?
- 5:50: How often should IT be evaluating these algorithms?
- 7:05: Who should be working on this problem, and what sort of resources should a company devote to it?