Supply chain audit

But before approving the expansion, Industrial s management wanted a supply chain audit of the entire system. This meant an analysis of all physical and informational flows throughout the system. Industrial wanted a complete analysis of every step in the supply chain, inside and... 

We will now focus on steps involved in completing an audit of a supply chain ([59]). The goals of this supply chain audit are to (1) understand the architecture of the current supply chain and (2) identify potential sources for improvement. 

The first step in a supply chain audit is to map chain structure and ownership as well as associated flows of physical products and information (orders) between members of the supply chain. The role of a supply chain map is to get a picture of the overall supply process and where the particular retail store fits. It reminds the manager that the current supply sources may need to evolve as the product characteristics change. 

The next step in a supply chain audit is to examine how capacity is deployed by understanding its product-based allocation, which is related to design choices across locations and product types and across locations. Thus, we will first consider how products can be separated based on their demand volumes and consequent impact on capacity requirements. The next step will be to consider if product design specifications can be standardized to improve supply chain performance. Finally, the impact of a consolidation warehouse on required capacity will be considered. 

This example suggests that supply chain costs can be decreased by adjusting the supply process to match product characteristics. Thus, in this step of a supply chain audit, the question is Are the supply chain capacity and its deployment tailored to product characteristics If not, how can supply chain costs be reduced by such adjustments ... 

The supply chain audit question is Can geographic postponement be used in this supply chain to improve performance ... 

This chapter focused on examples of supply chains and their underl dng supply chain architecture, using a Four C conceptual framework. The Four Cs refer to chain structure and ownership, capacity, coordination, and competitiveness. The supply chain audit permits an understanding of current choices and an approach to evaluate alternate choices for supply chain architecture. The goal of this chapter was to explain the Four C choices made in different successful supply chain contexts. 

The coordinated approach contracting relationships built on collaboration, trust and close interpersonal ties define the coordinated approach. This approach means that the producer inherits the responsibility and costs of social auditing as they are passed down the supply chain. This is achieved, however, within the framework of close retailer-supplier relationships. Although subcontracting exists, known networks of traceable suppliers are involved. As such, it is possible to exert considerably greater control over the ethical trading process. 

Quality control in the upstream supply chain is part of our supplier approval system and regular supplier auditing. The applied control systems are based, as within our own factory premises on the HACCP systems (Hazard Analysis on Critical Control Points). These quality control systems have been elaborated for each individual raw material. It is our objective to source our raw materials as far as possible from approved suppliers these are suppliers who are able to guarantee the qualities we require. 

For medical devices, inspectors expect to see a process improvement program in place encompassing all activities within the supply chain, including the systems that support it. Activities that would provide evidence that such a program is in place include the implementation of documented processes such as Corrective and Preventative Action (CAPA), self-inspection, and internal audits." Organizations should ensure that where an SOP has been put in place to initiate a process improvement activity, the SOP is adhered to. For example, if a quality audit SOP states that all areas shall be subject to audit at least once every 2 years, then inspectors will expect to see evidence that this has been the case. Failure to do so is likely to result in a citation similar to that issued to Krieger Medical, Inc. ... 

Flanges Fraudulent, inadequate flanges from other countries escaped detection and were used on domestically produced equipment and piping systems Excessive search and removal from installed equipment and piping systems where catastrophic failure might have resulted Ensure all suppliers pass audit and have adequate quality control procedures for their supply chains... 

A good transportation risk management system includes periodic audits of the management system, its technical elements, and compliance across the supply chain. The purpose of an audit program is to provide feedback on transportation risk management efforts to improve or enhance current operations such as determining ... 

Transportation risk management program procedures of the supply chain partner commissioning the audit and those of the supply chain partner being audited... 

Salama K, Luzzatto D, Sianesi A, Towill D (2009) The value of auditing supply chains. Int J Prod... 

The open and seamless lines of communication that often exist between supply chain partners tend to have a leveling effect on the IT security posture of all involved. Just because your firm takes information security seriously, it should not be assumed that partners do the same. Twelve percent of the respondents in our study reported terminating a relationship with a supply chain partner over security concerns. Treat interconnected IT systems as a special case of the untrusted network. Audit and protect it accordingly. 

Audit supply chain partners before, during, and after establishing a collaborative relationship. Amazingly, many firms link themselves to partners without knowing anything about their security posture orprac-tices. Thirty-seven percent of firms never audited their supply chain partners, and only 23% of the firms in our study audited prior, during, and after a partnership. 

The disaster sparked global responses. New safety standards for garment factories in third world countries and closer involvement in supply chains by major retail companies from the United States and other countries were instigated. Many saw the need for clothing retailers to conduct audits of supplier facilities and safety practices as part of their corporate social responsibilities. 

Personal Mastery. Audits are prepared and carried out annually for each of the purchasing categories. The aim is to ensure that the Supplier Code of Conduct is followed in practice throughout the supply chain ... 

Grazyna Wieteska is Assistant Professor of Business Administration at the University of Lodz. She has several years business experience in the area of B2B relationship management and risk management. Since 2007 she has been employed at the Unit of Operational Processes Excellence at her home university. She lectures on supply chain risk management, business continuity management and logistics audits at a variety of business schools in Poland and abroad. 

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