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  5. Seven Trends in Strengthening Business Continuity and Supply Chain Risk Response:What Leading Companies Consider in Improving and Advancing Their Competitiveness

2013 Vol.3
Seven Trends in Strengthening Business Continuity and Supply Chain Risk Response:What Leading Companies Consider in Improving and Advancing Their Competitiveness

2013/08/02

In recent years there have been a notable number of companies that have scaled up efforts to reconstruct and develop two major tools for strengthening business continuity. These companies have reconstructed their business continuity plan (BCP) and have developed a system to manage supply chain risks involving materials and equipment. Companies that have actively restructured their BCP have made it highly sophisticated and multilayered. Although details of these BCPs vary across companies, there are many general commonalities, and, in particular, major trends exist in terms of the approach to the restructuring. As for the management of supply chain risks, the current state is such that the only relevant activities observed are progressive actions taken by some major companies in the manufacturing industry (automobile, construction machinery, industrial machinery, etc.). The management framework is being defined despite some remaining issues. Japanese companies’efforts to solve issues in BCPs and supply chain risk management were triggered by the Great East Japan Earthquake and the floods in Thailand, both of which occurred in 2011.
Facing limitations of their measures to prevent or mitigate disasters, companies, as a first step, revised their BCP, which tended to center on disaster prevention planning, and shifted their focus to its original purpose─continuation of business activities during an emergency situation. Then, as a tendency to increase the return on investment in BCP development arose, companies made a shift to activities emphasizing the preparation of substantive measures that would generate positive economic effects in both normal and emergency situations, that is, activities that would reduce business continuity risks existing in production processes and the supply chain. Since efforts to strengthen business continuity must cover a wide range of business operations, companies’relevant reconstruction and development efforts must be based on the characteristics of their business, which has led to each company’s efforts differing from others’. Therefore, to contribute to companies’future efforts to strengthen business continuity, this paper focuses on the real main issues, summarizes them in seven trends, and discusses practical approaches to such efforts. In particular,this paper has an entire section on the response to supply chain risks which is the newest trend. The concluding section summarizes the paper from the standpoint of companies’competitiveness.

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