Supplier qualification during crisis
The outbreak of COVID-19 had a disruptive effect on global supply chains, forcing companies to find new ways to qualify, assess and manage suppliers in their value chains.
Structured qualification of suppliers is always essential to ensure business continuity, quality, safety and sustainability. A crisis such as COVID-19 puts additional pressure on companies’ abilities to maintain control and perform adequate due diligence. Circumstances may complicate continued assessment and management of existing suppliers. It may even force companies to quickly onboard new suppliers.
COVID-19 is one very current example of a global crisis affecting business continuity and the resilience of supply chains. Others caused by climate change, political unrest, natural disasters or other shocks in international trade may require our attention in the future.
Actively managing the process for supplier qualification:
- Identifies risks and puts you in control of every link;
- Demonstrates to your supply chain and stakeholders that you are upholding set standards;
- Safeguards your business, customers and consumers in the long-term;
- Ensures business continuity and builds resilience.
Identifying gaps, appropriate steps, and continuing to actively qualify and assess suppliers are actions required to address risks, maintain control and keep the wheels turning. DNV can support you with gap analysis, setting up new supplier qualification systems and solutions, or reviewing existing ones to adapt to the new scenario. We work with you to enable remote audits and plans for ensuring adequate and compliant monitoring of new and existing suppliers through:
- Gap analysis of supplier qualification gaps. Assess existing practices and processes to understand your company’s status, identifying adequate follow up actions. You can either assess your overall system or look specifically at your crisis-related status.
- Training or workshops. Dedicated sessions, delivered remotely, to follow up the gap analysis results for companies that wish to understand more about identified topics or issues before proceeding.
- Supplier qualification systems and assessments. Support in setting-up structured supplier qualification system and/or assessment programs according to the procurement strategies, goals and risks. This can include writing protocols and procedures that describe the company’s qualification criteria for any given parameter, i.e. sustainability. The protocols and tools used to assess the suppliers can be customized to a specific company and supply chain. Assessments can for example be based on an ESG (Environmental, Social, Governance) risk mapping and desktop assessment.
- COVID-19 risk mitigation audit. Provides brands and retailers forced to suspend supplier monitoring programs due to access and travel restrictions with an assessment of their policies and procedures’ compliance with national COVID-19 regulations and instructions. This includes an evaluation of the controls required to be in place, such as (PPE, physical distancing, control of access, limitation of unnecessary travel) and a review of the controls in place. This will help companies adapt and implement compliant policies to actively continue supplier audits, demonstrating to stakeholders continued commitment to workers safety and active supply chain management.
- Continued supplier assessments. Builds a plan and executes audits on suppliers to ensure continuation and control even during the crisis. This includes a review of existing audit plans/programs, identifying what parts of your supplier audits can be still done on-site and what parts can be done remotely or replaced by innovative digital alternatives. Combining the planning with a COVID-19 preparedness audit ensures audit execution in compliance with national crisis regulations and instructions.
- Digital Assurance solutions. Remote assessment of suppliers’ capability and performance has become a reality, thanks to technology advancements in the field of live streaming, telestration and remote control, enhanced software and new mobile devices.
As a global auditing company, DNV can support you with your different supply chain risk mapping, auditing & monitoring and remediation solutions.