In a previous blog post, my colleague has gone in depth on “How to save $10M+ with Supplier Mastering” by creating a comprehensive 360 view of supplier activity. This view is possible through programatically unifying all points of supplier data at scale. By finally being able to understand questions like “who are my suppliers?” and “can I trust my supplier analytics?”, it becomes so much easier to onboard suppliers with confidence and investigate your supply base for insights into compliance with government regulations, as well as sustainability & diversity goals.
However, the value of unified supplier data doesn’t stop there! We have seen that mastered supplier data enriched with various strategic data sources continue to help large enterprises put in place new systems to not only generate additional insights, but mitigate risks of supply chain disruptions that could cost them millions of dollars.
Leverage Various Data Assets to Enrich Your Supplier Base
As leaders in procurement know, any disruption in the supply chain can cause expensive, negative impacts all across the organization and should be monitored and mitigated before it happens. This risk is particularly tricky to manage given the current global economy with multiple layers of third-party risks. However, by unifying external sources along with your organization’s mastered supplier data, the organization is positioned to implement an powerful risk mitigation process to protect profitability across the wider business.
Below are four common areas of risk mitigation that benefits from enriching mastered supplier data with various external data assets
1. Maintain a Diverse Supplier Base
In addition to providing equal opportunities for suppliers, a diverse portfolio of suppliers is critical to mitigate the risk of over-reliance on any key supplier who may one day fail to perform. Due to the complex ecosystem of global trade and corporate structuring, it is very difficult to determine whether two suppliers, who may look like different entities, actually share the same supply network thus provide the same risk of failure.
By mastering suppliers against aggregated list of global entities and trade associations, it is possible to avoid often overlooked overlaps that may lead to unnecessary risk.
For example, mastering your supplier base against known hierarchical entities through sources such as Duns & Bradstreet, Owler, or GLEIF can provide clues to whether suppliers are part of the same corporate umbrella. In addition, mastering your supplier base against known list of key associations can provide additional context around third-party risk that might not be obvious.
2. Identify At-Risk Suppliers Based on Another Supplier’s Performance
Just as it is important to keep your supplier base diverse using external entity data enrichment, it is also important to identify suppliers that are similar. By clustering supplier entities together that share the same corporate umbrella, logistics network, or associations, you can quickly respond to potential failures when one supplier in that cluster fails to perform. While one supplier’s failure certainly doesn’t spell disaster for its counterpart, having these kinds of alerts at your fingertips will allow you to respond much more quickly when anything happens.
3. Understand Global Conditions
There are many external global factors threatening your supply chain that, while seemingly overwhelming, can be monitored. Depending on your specific concerns, various sources of external data enrichment can be used to master against your supplier base to ensure that you are always alerted when something in the world changes. This may include data around geography, weather, financial news, geopolitics, and more.
For example, enriching your supplier data can alert you of potential flooding for factory plants located in regions classified as flood plains, or that sanctions have recently been placed against the parent organization of one of your key suppliers.
4. Flag against Undesired Entities
Are your suppliers reputable? Are they associated with sanctioned entities? Do you have an internal blacklist that supplier-related entities are trying to avoid detection? While most enterprises are careful to screen their suppliers through the onboarding process, that level of scrutiny begins to loosen after onboarding.
For example, you may want to be notified if one of your supplier’s subsidiaries showed up on the U.S. OFAC list. By mastering your supplier based against a live list of risky entities, a hands-off system can put in place to monitor your mastered supplier entities for potential alerts when and if those occur.
Let these alerts and notification enabled by unifying third party enrichment sources save you risk and headache down the line.
Get More With Your Data Assets
As an enterprise organization, chances are that you have a large volume of both internal and external data assets that are being used in various ways. Oftentimes, these data assets are either used once and forgotten or are left to fill a very niche use case.
With the help of Unify, we have helped many organizations collect and unify data assets across data silos into unified singular systems of references. Along with our own catalog of third-party enrichment sources, we can leverage your existing assets to enrich and get more value out of your mastered supplier records.