Sometimes globalization seems like a pursued goal among companies. The variety of suppliers and the ability to engage in business globally seem infinite. You can buy cheap and sell (almost) anywhere in the world. Bonanza! However, globalization has brought countless new challenges and risks to companies.  

Political, governmental, and economic climates in countries where a company operates – someone mentioned a trade war? Company and customer data security – do you know the level of security of your subcontractors? Counterfeiting of materials and products – have you ever wondered why products from Chinese factories are cheaper? Customers’ desire to know the origin of everything and receive it on time – it’s not easy to achieve that when you have no control and transparency over the shipping process. Some of these points are not always under the company’s control, while others are. However, the key to dealing with these challenges and risks is based on one insight alone: building an intelligent supply chain risk management system, also known as SCRM (Supply Chain Risk Management). While the insight is clear, implementing it involves numerous parameters and management methods. Indeed, it’s difficult to predict political climates, trade wars, or the actions of specific individuals like Trump, so it is important to adopt an active approach of risk diversification and workload distribution among manufacturers and suppliers from different countries – especially when working with countries prone to terrorism threats and political upheavals. This significantly reduces the likelihood that an economic collapse of a country/company or a natural disaster will leave you facing a broken market. Do you have a plastic supplier from China? It won’t hurt to have alternative suppliers in Taiwan.  

In the global era, information security should be a top priority for every company. Therefore, it is imperative to start working with encrypted systems where different encryption keys are used for each system. As you saw in the blockchain article, this is one of the most efficient ways to take the first step toward that. It is important to entrust the company’s data security to specialized companies, but without neglecting the organizational allocation to an in-house security department that oversees the process.  

The challenge of counterfeiting and fraud prevalent in the supply chain is connected to the challenge of customers demanding to know the origin of everything! Therefore, it is time to integrate the company’s management systems with digital platforms that provide information and transparency throughout the supply chain. This is a process that must be implemented here and now. Here again, blockchain technology can provide the ultimate solution – you can’t steal a load from an encrypted certificate or impersonate its owner. And since there is accurate information about the location of the load, it can be determined whether it actually came from the Chinese factory that was ordered from or from another factory the Chinese manufacturer works with to save costs. Additionally, even if the load is stolen or lost, we can precisely track its location, and the thief cannot cover their tracks because the encrypted information is owned by the entities involved in the process.