5 Best Practices For Supply Chain Risk Management
Supply chains are ever-increasing in complexity. Supply chains may have achieved “critical mass,” as evidenced by shortages at the start of the pandemic in the U.S., resulting in a desire to bring manufacturing home for critical supplies (including medical devices and pharmaceutical products).
We condensed the complexities into five simple signals to watch for when assessing your supply chain. We recommend deeper examination and correction in any area where you see any of these.
How To Manage Supply Chain Risks
It is crucial to understand potential disruptions, such as delays, damaged products, partner resistance, and regulatory challenges when managing a supply chain.
From maintaining strong relationships with reliable partners, and regularly auditing supply chain activities to ensure compliance and efficiency, we’re able to help reduce supply chain risks effectively.
Related: How Is Your Supply Chain Management? Download This Supply Chain Audit Checklist.
Avoid Delays
Delays are a sign that something is wrong. If a shipment did not make it to the customer on time, it often signals an underlying risk that will point to the root cause of the delay. Transportation delay?
Maybe your 3PL employs unreliable drivers or uses poorly-serviced equipment. Backorders? Maybe your suppliers have instability, or your own processes are out-of-control. Customs delays? Are you sure international clearances are complete? You get the picture.
Choose Quality Shipping
Product damage is supposed to be a rare occurrence. For instance, medical device regulations state that the design of a device includes the design of its packaging. In other words, risks to shipping damage are expected to be anticipated, and therefore, essentially nonexistent.
Damaged product might also signal product tampering – do you know if you can trust everyone who handles your products? Maybe material handlers lack training on how to handle your product.
Create Good Partnerships
Your business partners are essential to a robust supply chain. They are, in fact, part of your quality system, and need to be integrated with your operations as such.
Refusals for quality agreements, inspections, or sharing of information through nondisclosure agreement should raise a red flag, and signal that the company you intend to partner with (supplier, logistician, broker, etc.) may not be appropriate for a highly-regulated product.
Consider working exclusively with suppliers who specialize in the needs of the pharmaceutical and medical device industries and confirm their registrations on the FDA website, as applicable.
Document Properly
When going on a trip, one equips oneself with a GPS or road map to be oriented to the destination. Effective (and validated!) electronic and documentation systems are also needed to assure that product arrives at its destination on time, and correctly. The result of a poorly documented or understood system is confusion, much in the same way of a lost traveler.
Major confusion can come from understanding the shipping routes, and the changes that ensue as the Drug Supply Chain Security Act (and similar international regulations) near implementation. Take the time to plan, and your customers will thank you!
Study Audit Findings
Findings in an audit or inspection are a sign that one or more of the above items were overlooked or minimized. The ultimate sign of a good supply chain management program is the capacity for self-reflection; the ability to question the process from the same objective angle as an auditor might, so audit findings are averted.
Time To Organize Your Supply Chain
The rare inspection finding is often a signal that the organization’s capacity for self-reflection is off-kilter. Leverage your organization’s CAPA system to be better prepared next time.