5 Ways Your Supply Chain Could Be at Risk for Disruption

Supply chains move materials or goods from one location to another. While traditionally that’s represented movement of physical parts and materials, today, your organization’s supply chain may also include electronic transfer of data or services.

Did you know that 70% of manufacturers experienced at least 1 supply chain break in the past year and that supply chain breaks are one of the top three threats for manufacturers?

Supply chains are a lifeline for most organizations. When disrupted or delayed, there are often devastating effects on operations. That’s why effective business continuity (BC) programs should include supply chain resiliency. Routine vendor assessments as part of your BC program can help keep operations running smoothly, ensure compliance, and facilitate rapid mitigation and resolution in case of an event.

Here’s a look at a few examples of supply chain disruptions and how they can impact operations:


Supply chain cyber attacks are on the rise. Symantec’s Internet Security Threat Report notes a 78% increase, with attackers taking over software updates and adding malicious code to software as common tactics. This is particularly troublesome for online retailers and eCommerce sites where form-jacking allows attackers to compromise third-party services—everything from chatbots to widgets.

According to a study by CrowdStrike, less than 40% of U.S.-, U.K.-, and Singapore-based organizations have vetted all of their external suppliers in the last year, and when they do, they don’t have the same security requirements for third-party vendors as they do internally.

In that same study, almost two-thirds of respondents indicated they were victimized by some sort of digital supply chain attack in the past year, costing an average of $1.1 million.

Carbon Black went on to point out that about half of these supply chain attacks use “island hopping,” which enables attackers to target multiple networks that are connected by a supply chain. Finance, manufacturing, and retail are among the top three industries targeted.


From wildfires to hurricanes, tornados to floods, and earthquakes to snowstorms, natural disasters are big supply chain disruptors.

Aon’s “Weather, Climate & Catastrophe Insight: 2018 Annual Report” indicates there were almost 400 natural catastrophic events in 2018. The total economic loss from those weather disasters? $215 billion. That includes 42 individual billion-dollar natural events that year. The costliest natural event was California’s Camp Fire at about $12 billion.

While Camp Fire was the state’s most destructive fire on record, its losses pale in comparison to the 2011 earthquake and tsunami that hit Japan causing $210 billion in losses, including impacting worldwide supply chains. In the U.S., Japan’s natural disaster resulted in major car manufacturers temporarily shutting down.


From the threat of global terrorism, to trade wars, and tariffs, the modern political landscape continues to be an emerging disruptor for supply chains.

Tariffs, for example, often increase production costs and can force organizations to seek alternative suppliers to offset increases. When those alternatives include outsourcing supplies outside the U.S., American companies can face significant political backlash and pressure.

According to the 22nd Annual Global CEO Survey, of CEOs who indicated trade conflicts were of extreme concern, 62% in the U.S. and globally are making changes to their supply chain strategies.


The Institute for Supply Management (ISM) indicates that through July of last year, supplier deliveries slowed for 22 consecutive months. Some of that was the result of significant employment and production cutbacks made during the Great Recession from 2007-2009 from which producers haven’t fully recovered. They’re struggling to keep up with increased needs for production fueled by current economic growth.

Supply needs are also further affected by our modern, “always-on” society, where products and services can now be purchased any time, day or night, from just about anywhere, with a simple mouse click or screen tap. Today, more than 60% of U.S. CEOs say agility is a critical supply chain capability to help them more efficiently meet customer expectations.


As organizations focus on improving operations and increasing supply chain reliability and efficiencies, 95% of supply chain leaders say they struggle to get unified insight into all of their supply-chain data. In another study, 66% of CEOs said supply chain data is critical for making decisions, but only 21% actually have comprehensive insight.

Supply Chain Resilience

With these risks and others impacting supply chains around the world, 42% of manufacturers are increasing their business continuity spending. They’re investing in BCM programs that include supply-chains with more than one point of recovery, including response and recovery plans for all primary and secondary vendors.

Remember, it’s also important for your third-party vendors to have their own BC recovery and response plans, so they can quickly respond to their own disruptions to prevent their issues from impacting your operations.

Ready for some hands-on help? Let’s discuss how to best achieve your resilience goals.