Supply chain remains high up German corporate agenda–Germany

They also agreed that the insurance market had reacted well to rising demands from customers over the last five years or so. Klaus Braukmann, Head of Insurance at Continental AG, said that he has certainly seen steps forward in supply chain risk management. “Yes there has been big progress in the automotive sector. This is now a CEO subject. We are taking this very seriously and have just put two million euros on the table to invest in the collection and analysis of loss data in this area. This data has to be collected from different parts of the company and we are setting up a dedicated IT system to pull all this together. Compared to three or five years ago I think we have made big progress There is still room for improvement but supply chain is certainly now in focus,” he explained.hideAlexander Mahnke, CEO of the Insurance Unit at Siemens Financial Services and current DVS president, agreed that supply chain continues to be an important topic. But he pointed out that risk and insurance managers and their insurers should not delude themselves that insurance is the main focus of debate on the topic in the boardroom. “Senior management of our DVS members are taking supply chain more seriously. But do not think that they wake up in the morning and think about insurance. This is not the case,” said Mr Mahnke. As with cyber risk, it is critical to remember that the first priority in this area should be risk prevention and management rather than transfer, agreed the German risk and insurance managers. Jörg Henne, Committee Member of DVS and Risk and Insurance Manager at EPCOS AG, said that he has seen changes in the way suppliers analyse their risks, but he is not convinced that all the work is that useful. “There has been a real change in the behaviour of OEM and second tier suppliers. They try to collect data which they define as risk related, but it is unclear how this data is used, how it benefits to manage the supply chain risk and most of all how it influences the future procurement decisions. In the end a risk valuation and the management of a risk cannot be solely based on questionnaires,” said Mr Henne. Christian Böhm, Committee Member of DVS and Risk and Insurance Manager for Freudenberg & Co, said that one of the problems with the analysis of supply chain risk is the speed at which supply chains change in today’s economy. “The problem is that parts of supply chains change every day and so the profile of the risk changes every day. It is difficult to keep up with this changing profile,” said Mr Böhm. Mr Mahnke said that one of the big challenges in this area is posed by the fact that the economy has radically changed in recent years and many companies are becoming service providers rather than producers of goods. This has big implications for the risk profile, not least in the supply chain, he pointed out. “Industry is changing and I am not just talking about Industry 4.0. Some of our companies in the past solely produced things and so the risk emanated from production. We now live and work in an environment where it is more about providing services than goods,” he explained. The danger is that companies and their risk and insurance managers experiencing this apparently inevitable change are unable to adapt fast enough. “I am not sure that we are following the changing risk exposure at the same speed of change,” concluded Mr Mahnke.

Supply chain remains high up German corporate agenda–Germany

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