Not everybody will know exactly what Business Continuity is, but many will have heard about it. Similarly, many will have heard of Supply Chain Risk Management, but Supply Chain Continuity? Well, that is what you get when you match Business Continuity Management and Supply Chain Management, and that is what Betty Kildow did in her newest book: A Supply Chain Management Guide to Business Continuity. To be honest Supply Chain Continuity is never used in the book anywhere, but that’s what it is; instead, she uses Supply Chain Business Continuity. Personally, I consider straightforward supply chain continuity the better terminology.
Semantics aside, this is the first book that I have seen that successfully marries Business Continuity Management with Supply Chain Management, and that looks at supply chains form a business continuity perspective, or rather, looks at business continuity through supply chain glasses.
In its structure, the book more or less follows the same and familiar steps that Steve Cartland used in his book chapter on business continuity in global supply chains:
- Assess the risk
- Analyze the business impact
- Develop business continuity strategies
However, unlike Cartland's book chapter that bases much its ideas from IT continuity, Kildow focuses on supply chains in particular, explaining in detail why and how she thinks that business continuity thinking should be part of supply chain management.
One of the major points that Kildow stresses in her book time and again is that business continuity is NOT business as usual, but business at an acceptable level, where the acceptance level must be defined by the business itself, depending on whether or not an to what degree the loss of certain business functions will
- Directly result in a loss of revenue and profit
- Potentially result in a loss of customers
- Directly result in increased operating costs
- Result in accounts receivable delays
- Delay distribution of products or service delivery
- Delay shipment or receipt of products
- Delay receipt of materials, parts or components
- Negatively impact the company's current public image
- Result in significant liability exposure or other legal ramifications
- Prevent the company from meeting regulatory requirements
- Lead to imposition of fines or other penalties for failure to fulfill delivery clauses or meet service level agreements
- Result in financial penalties for late payment of accounts payable
- Whether the supplier is a single or sole source for a vital product or service
- Whether your company is a priority customer or not
- The proximity of your supplier to your facility; closer may be better, but remember to then also assess
- Whether you and your supplier can be impacted by the same disaster, i.e.
- Whether the supplier's operations are geographically dispersed or clustered
- The length of time required to process and deliver an order placed with the supplier
- The suppliers history, financial standing and reputation
- The expected level of difficulty in finding an alternate supplier
- Whether the supplier has a continuity plan, in particular
- Whether the supplier can restore activities in time to meet your requirements
Not only does Kildow go into details about risks and strategies specific to supply chains, her book also includes a detailed appendix on
- how to assess your own business continuity readiness,
- what specific hazards a supply chain continuity plan should include,
- how to deal with pandemic issues,
- how to set up your continuity team,
- three continuity plan samples, and
- a supply chain/business continuity glossary.
Reference: Kildow, B. A. (2011) A Supply Chain Management Guide to Business Continuity. New York: AMACOM.