Supply chain complexity - top business continuity concern for automotive industry

A third (35%) of businesses in the manufacturing industry are extremely concerned about potential supply chain disruption according to research released by BSI, the business standards company and the Business Continuity Institute (BCI). More than three quarters of manufacturing firms (77%) report increasing supply chain complexity as the fastest growing risk in business continuity, with malicious attacks via the internet (68%) and increased regulatory scrutiny (58%) taking second and
third place.

Global sourcing across supply chains creates severe business continuity challenges for manufacturers with key industry being automotive. BSI’s business continuity management system helps companies across different sectors to manage distruption due to natural disasters, man-made disruption (conflicts) and a lack of resiliency in different countries.   

Risk exposure varies by sector. The proportion of supply chains exposed to elevated, high or severe risk of natural disaster is highest for the apparel (85.6%), automotive (53%) and aerospace (51%) sectors, all of which have a high proportion of manufacturing and raw material sourcing based in politically and geologically unstable regions.

While the relative risks differ, the key lesson for organizations to consider is their planning for potential disruption. For example, the automotive sector suffered heavily from the 2011 Japanese tsunami due to a global reliance on a single manufacturer of a particular pigment essential for metallic paint finishes. As a result of the disruption, production in the factory was halted for three months before normal operations resumed, causing long lasting effects across the automotive marketplace.