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Supply Chain Risk Mapping Tool

For a business to develop resilience to climate change it needs to ensure the resilience of its supply chain as well as its own business. A supply chain mapping methodology allows you to assess the ways in which drought, flood and other risks occurring in your businesses’ supply chain as a result of climate change impacts can be assessed. By making the treatment and management of the risks more effective – your overall approach to risk management becomes more systematic.

This methodology is based on value chain analysis, risk assessment of suppliers and customers, and interactions with business and service processes. The methodology is applicable to businesses providing products as well as services and allows for risk associated with various extreme conditions (i.e. flood, drought, prolonged heat wave, etc).

The methodology is based on a 12-step action plan that will allow you to;

  1. Assess risks amongst your suppliers

  2. Identify ways in which those risks might transfer into your business and service processes

  3. Identify ways in which your customers and stakeholders may be affected.

The key steps for applying the supply chain mapping methodology to a business are;

 

Step 1: Establish an inventory of your suppliers

Step 2: Characterise your suppliers

Step 3: Assess the risks and vulnerabilities of your suppliers

Step 4: Assess the criticality, drought and flood risk status of your suppliers

Step 5: Establish an inventory of your business and service processes

Step 6: Assess the risks to your business and service processes

Step 7: Assess the transfer of risk from suppliers into your business processes

Step 8: Assess the vulnerability of your business and service processes

Step 9: Establish a customer and stakeholder inventory and action plan

Step 10: Establish a management system for your contingency planning

Step 11: Link this contingency plan to your Business Continuity Plan

Step 12: Maintain a programme of continuous improvement

 

How to Get Started?

It’s simple. All you need to do is following the ‘Worked Example’ of the 12 steps and use the associated blank templates provided to enter in information for your business.

Should you have any questions about following the 12 steps please contact Groundwork on 01394 444218.

 

Reference Notes

Smart businesses know how to manage supply chain uncertainty. But extreme weather and our changing climate present a new set of uncertainties that threaten old ways of doing business. Little information is currently available on the unique vulnerabilities facing supply chains and how businesses can increase their resilience. This guidance fills this gap, providing information on climate risks and opportunities, and demonstrating how this understanding can be integrated into established business practices for addressing risk across supply chains.

This methodology makes use of the Environment Agency on-line flood plain mapping tool to identify flood plain risk in the supply base. The methodology should be used in conjunction with the Guidance recently issued by the Environment Agency's Climate Ready Support Service to provide a generic approach to evaluating the risks and opportunities faced by business and their supply chains as the climate changes [EA2013]. The Guidance published by the Environment Agency on managing risks in the supply chain provides a wealth of information on assessing risks and opportunities. The Guidance covers topics such as procurement, sourcing, negotiating, buying, pricing, supply collaboration, design collaboration, operations, infrastructure, logistics, distribution, and customers. Several case studies are presented in the Guidance to illustrate specific ways in which businesses can develop resilience.

The underlying premise of the approach used here is that by making the links and flows between supply- and demand-sides of the business more resilient, the business itself will be made more resilient. A worked example of the supply chain mapping methodology is presented for the case of a small hotel as part of a regional group of hotels. In addition to risk assessment, the worked example shows how Scope 3 (supply side) greenhouse gas emissions can readily be estimated for the business, as well as visualisation of the risks in terms of supplier flood risk and business process risk. Templates for application of the methodology to a business are provided and can be used for a variety of weather conditions (flood, drought, etc).

Templates Examples
Supplier Inventory Examples to follow
Characterisation Supplier Examples to follow
Supplier Flood Drought Supplier Examples to follow
Supplier Criticality Examples to follow
Characterisation Supplier Examples to follow
Risk Assessment of Business Service Processes Examples to follow
Transfer of Risks From the Suppliers into the Business Processes Examples to follow
Vulnerability Of Business And Service Processes Examples to follow
Customer and Stakeholder Inventor Examples to follow
Management Of Contingency Plans Examples to follow