Andrei: (00:52)

Hi everybody. I’m good.

Ben: (00:53)

Thank you so much, Andrei. It is a really an amazing experience and an opportunity to talk to you today. And as we know, the discussion today is on the topic risk and disruption management using SAP integrated business planning. So on the same topic, we have some questions submitted by our listeners for you. I hope they’ll find this episode insightful, uh, interesting and informative. So before we go forward with the questions, I would like to remind all business that you can submit your questions by clicking the link found in the description. So with no more delay, here are the questions. How can companies prepare for supply chain disruptions?

Andrei: (01:31)

So first most of the supply chain have an inherent resilience to disruptive events. For example, the scope of the safety stock is to protect against variability of demand and transport and under normal condition. The stock will be sufficient to cover customer orders. Second, most supply chains are following industry best practices. For example, multiple sources of supply portfolio diversification, and thirdly planners intuition play a crucial role in preventing and recovering from unforeseen events. Nevertheless, organization can prepare for supply chain disruptions by actively simulating and checking the system performance.

Ben: (02:13)

Okay. System performance, talking about system performance. What is system performance?

Andrei: (02:18)

Good question. So system performance is related to the ability of a supply chain system three return to a stable state after disruption. This involves both the ability to withstand systematic discontinuities as well as the capability to adapt to new risk environments. And when looking at the system performance, we would need to talk about risk and disruption management.

Ben: (02:42)

Okay. So what is risk and disruption management?

Andrei: (02:46)

Risk is the process to identify, evaluate and prioritize risk followed by a coordinated and economical application of resources to minimize, monitor and control the probability or impact of unforeseen events or to maximize the realization of opportunities. There are two types of events. For example, negative events. We classify them as risk while positive events are classified as opportunities. Disruption management is the process for which a company recovers from a disruptive event and usually consists of three phases discovering the recovery and redesign discovery refers to the point in time when people become aware of supply chain disruption after discovery managers then begin to either stop the event and or begin the recovery process. And how quickly manager recognized that the event or disruption is occurring is vital only then, then can recovery full, fully realize upon the return of the supply chain to its previous state begin. After the disruption is discovered supply chain managers often first assess any previous plans that have been developed as part of the risk management planning processes. This is the concept of readiness or plan of action that is standing by for implementation should certain events occur and aid managers in determining what immediate actions to take in response to the effect of the event that has been occurred. Recovery phase includes formal or informal designation of the decision maker or makers who will lead to the recovery effort. Companies may centralize this decision-making authority in one primary return leader, sorry, or in a team that has been created to make recovery decisions or in a hybrid of the two approaches. Some companies establish war rooms or meetings of individual reps representing various parties in the supply chains or various roles within the focal organization who will make decisions regarding the recovery process during or after the event is recovered from learning effects and system redesign the first step of the disruptive management. At that point, they can start being implemented to avoid future financial and or services impacts to the supply chain. So each in short, this will be in the risk management and a disruption management.

Ben: (05:11)

Yeah. So what is the case for this in IBP, case for IBP?

Andrei: (05:18)

Okay. So the case for IBP, so integrated business planning disruptions can affect companies usually in two primary ways, financial and services impact financial impact, refer to the monetary costing cure as a consequence of the disruptions and service failures that occur during disruption because companies cannot devote as much intention to customer demand as they can in normal operating environment. The goal of the risk and disruption management process is to minimize this impact and the respective coasts on the supply chains in today’s supply chain without the proper integrated planning tool company usually rely on a wait and see tactic in dealing with disruptions. Many organizations still continue to work in traditional silos and firefight their way from, uh, to learn more about how SAP IBP can help mitigate risk and provide an efficient and effective response to your subdivisions, we invite you to check our webinar on this topic risk and disruptive management with SAP IBP.

Ben: (06:20)

Perfect. Thank you so much, Andrei, for this insightful episode with us, it was really knowledge. I mean, it was filled with knowledge and it was really insightful for us and I appreciate all of your efforts and I am looking forward to connecting the two for many more, uh, other episodes.

Andrei: (06:39)

Thanks, man. Same here. Looking forward to more podcasts to come. And also as mentioned, check our out webinar on risk and disruption management with sub IBP there, we will go a bit more in details, what risk and disruption management we can do with SAP IBP, the different steps, the what if simulations? So it’s a very entertaining webinar and we’re looking forward to connect a bit more on this topic on

Ben: (07:06)

That’s Perfect. Thank you again. And I will also remind all our listeners, uh, today, again, to be part of our podcast by submitting your questions. When you click on the link that is available in the description below. So thank you again for joining all of us. This is supply chain today cheers.