Outsourcing, supply chain and third-party risk is one of the top five areas where internal audit spends its time and effort, according to Risk in Focus 2020.
This short read draws on leading thinking about the future of supply chains and how developments could influence internal audit assurance deep within the supply chain.
Advancements and new developments
Continuous advances in delivery and logistics management are making supply chains smarter and faster, with the potential to improve sustainability and meet heightened customer expectations. In addition to technology, key drivers of change in the industry also include climate risk management, resource scarcity, labour migration, shifting demographics and political uncertainty.
New trends may include:
- Reducing cost and attracting customers by switching to positive environmental
- Sea and land integration strategy for two of the largest container freight companies, Maersk and DAMCO, coupled with digitalisation to improve efficiency and flexibility while reducing costs.
- Blockchain technology could enable complete supply chain tracking, enhancing inventory management and maximising asset utilisation.
- Digital workflows and artificial intelligence through to robotics and drone deliveries replacing human workforce in areas where return on investment is achievable as digitalisation can be costly.
- Increasing efficiency and effectiveness of logistics through partnerships.
- Rise in protectionism and the uncertainty of tariffs and quotas on pricing and demand.
- Simplifying supply chains and heightening supplier relationships to improve traceability and remove the risk of hidden risks deep within a complex supply chain.
Is your organisation too dependent on one locality for supply, such as China?
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