A large pharmaceutical manufacturer wanted a detailed picture of its manufacturing supply chain dependencies as part of a risk mitigation assessment.
The business decided that materials management/procurement systems were inadequate for the task, as they often don’t hold manufacturing location data. Instead, they are more likely to have a record of an agent or distributor of the manufacturer. Also, these systems are designed to prioritise risk based on spend, rather than value at risk, which makes it difficult to prioritise the mitigation of suppliers that could be the most financially damaging if impaired.
The risk director used SCAIR® to identify and quantify the locations that presented most financial risk to the business; and the Natural Catastrophe alerting tool to provide the procurement team with information about their most exposed supply locations.
SCAIR® helped the client build a detailed picture of its supply chain dependencies over a number of annual reviews, expanding the scope of study year on year to cover all its major brands.
This review included quantifying several contract manufacturing and critical supplier dependencies in Florida and Puerto Rico.
When Hurricane Irma threatened to hit the coast of Florida at the end of August 2017, the manufacturer used SCAIR®’s exposure assessment and Natural Catastrophe Monitor to immediately understand which of its most critical suppliers and contract manufacturers were in Irma’s path and at risk. Unfortunately, they were forced to use the SCAIR® data again just two weeks later when Hurricane Maria made landfall on Puerto Rico, which is a world hub for pharmaceutical manufacturing facilities.
Supply chain managers and procurement rapidly anticipated the likely impact on critical materials, put continuity plans into action and activated alternative suppliers. This helped ensure business continuity, uninterrupted service to clients and the minimum impact on profits.