A survey by McGrathNicol and YouGov has found that 97% of Australian businesses are very or somewhat confident in their ability to respond to risks in the supply chain, but the reality is that many are underestimating or do not fully comprehend the real nature of these threats.
McGrathNicol partnered with YouGov to survey 300 Australian Directors and c-suite leaders across multiple industries on the risks they are concerned about, their risk management processes, and the barriers they face in addressing supply chain threats.
In the light of this apparent over-confidence boards must ‘interrogate the steps their organization has taken to understand, and mitigate, the many elements of risk that make up a modern supply chain’ says the survey report.
Key findings published by McGrathNicol include:
- 75% of business leaders say their organization has faced challenges addressing supply chain risks, with respondents citing a lack of awareness and understanding of their supply chain, apathy, limited data, unstructured planning, and the assumption that others are responsible for managing these risks.
- Only 16% of business leaders believe that geopolitical risk will increase in severity in terms of the impact on their organisation over the next 12 months. McGrathNicol believes that this underestimates the potential impact of the rapidly shifting geopolitical environment, including risks associated with upcoming Taiwan and US elections.
- Third party cyber risks are misunderstood, as many businesses think a global supply chain attack won’t impact them. While 64 percent of Australian businesses rank cyber security as the second greatest challenge to their organization (behind financial performance), businesses underestimate the likelihood or impact of an attack on their third-party suppliers to their business. Only 16 percent predict that these risks will impact their organization over the next 12 months, with only 27% including cyber risks within their supply chain management plans.