You’ve likely already heard about the horse meat scandal in the UK – the fact that horse DNA has been found in “beef” products such as hamburger patties and ready-to-eat meals sold by large, trusted retailers. And customers are freaking out, dropping affected brands like a hot potato. The big question on everyone’s mind is – how could these retail superstars not know what’s going into their products? Because if they were unaware of these hidden substitutions by players in their supply network, any company could be vulnerable to similar risks.
I suspect that the answer is rooted in growing supply chain complexity. Supply chains aren’t linear today – at least not very often. In today’s economy, they are more likely to represent a spider web with many touch points and inter-dependencies that span the globe. And without the right tools and transparency, you’ll find that complex networks are notoriously difficult to govern. Just one supplier to your supplier’s supplier has to sneak a substitution and bingo – you’re on the front cover of the Wall Street Journal for peddling unsafe or repulsive products.
Risks like these can occur anywhere and at any time. A recent blog by James Marland on The Network Economy highlights some of the ways business networks can help you gain transparency into supply networks and quantify these risks. For example, Marland suggests that you monitor Twitter feeds, Facebook, blogs and other social media to assess consumer “temperature.” (With Ariba Discovery Release 10 (AD10), we’re enabling suppliers to add links to their social media profiles to their supplier profile pages on Ariba so buyers can easily identify and follow their social media activities.) He also directs you to trusted brands such as Dunn & Bradstreet to understand the credit scores of everyone in your supply network. (Ariba Discovery’s Advantage and Advantage Plus suppliers can submit their D&B information with every response to a posting.)
It’s also recommended that companies gather information regarding how many other trading relationships a supplier may have with suppliers in the same industry or geography (a time-consuming process that Ariba will vastly simplify with AD10 by adding this data to supplier profiles). Other key data points for assessing supplier risk include check suppliers’ ISO certificates, accreditations and other documentation (which Ariba Discovery already shows on supplier profile pages).
Check out what our supplier profile pages will look like after AD10 – and you’ll understand just how much more transparency you’ll have across your supply network in the near future. And of course, if you’re in the market for meat, you’ll find thousands of meat suppliers on Ariba Discovery.
Sample Ariba Supplier Profile, update coming with Ariba Discovery Release 10 (AD10), currently scheduled for April 2013*
*This information reflects the status of Ariba's planning as of March 2013, and the features and release schedule discussed are subject to change at any time without notice. Ariba assumes no responsibility for errors or omissions and nothing on this page should be construed to represent any commitment by Ariba to include any specific new features in any version of the Ariba solutions.
