A supplier to major biopharmaceutical companies was identified as the sole source of certain biopharma materials. Consequently, one of these companies required evidence of the supplier’s supply chain risk analysis, as part of a due diligence exercise.
Furthermore, the supplier was coming under pressure internally from the finance team to reduce working capital in the form of safety stock. However, the supply chain leads were concerned about the message this would send about the resilience of their supply chains to customers.
Our client undertook a SCAIR® analysis of its own supply chain to assure the customer and its stakeholders. One of the key benefits of SCAIR® is that it follows the value – i.e. focuses efforts on the highest-revenue products – and this function was key to delivering a solution to the requirement.
The client manufactured a range of materials, including bespoke and standard specification materials, so the first challenge was to determine how to map the revenue streams.
Once the value streams were identified and the key assets modelled within SCAIR® (as a Baseline Scenario), the supply chain managers were able to use the Stock Scenarios functionality of SCAIR® to precisely target stock reductions. This was preferable to a blanket approach.
Using the Baseline Scenario as the reference point, two scenarios were set up:
The resulting exposure profiles proved invaluable to the supplier for two reasons: