The Evolution of Risk Management?

Tuesday, March 4th, 2014

Procurement decisions have the potential to create serious risks for a buying organisation. Allianz, the global business insurer identified supply chain risk as the #1 challenge in 2014 for risk management professionals. Not a surprise with the changes in business structures of the leading Fortune 500 – their businesses are growing through extended supply chains, with plateauing or shrinking internal resources. Procurement (or Sourcing or External Resource Management) is an increasingly critical function.

An evolution of risk management is needed.  A structured risk modelling tool to materially help to identify potential procurement and supply chain risks to stimulate the development of risk mitigation strategies.

Procurisk® is a risk modelling tool, unique in it’s field, designed to probe and identify procurement risks. It augments current risk management approaches, for example ISO 31000:2009 and is of material assistance to Directors, Corporate Risk, Audit, Legal, Finance and Procurement/Supply Chain specialists.

The benefits of using Procurisk® include:                   

  • Enhanced bottom line performance
  • Visibility of procurement risks to inform the Board of Directors
  • Greatly reduced potential for contract disputes
  • Lower insurance costs
  • Strategic supplier risks visible and managed
  • Robust methodology to support Audits and Corporate Risk Management
  • Enhanced negotiation strategies for risk allocation
  • Enhanced Contract Management processes to avoid supplier non-performance

Procurisk® currently has twelve (12) datasets, aimed at identifying risks in key facets of procurement. Examples of the datasets are; Supply Market Risks; Contract Risks; Intellectual Property Risks; Contract Management Risks; Vendor Risks and Price Management Risks.

Procurisk® is designed to be used on-line by our clients. The tool can be applied to a single purchase; a project specific procurement; a procurement category (IT for example), and in a dispute scenario. There are >200 metrics within the datasets. The metrics can be self-assessed within an organisation, although Brian Farrington Limited can provide resources to assist with the assessment. The output is visually displayed and offers the potential for an annual review of procurement risk management. Each metric has descriptors to help position your risk modelling on a risk scale. Procurisk® is augmented by ACTION guidance, suggesting possible actions that can be taken to mitigate your procurement risks.

For more information or for a free trial please contact me, Ray Gambell on 01744 20698, or email me at [email protected]

Visit the Procurisk site

We now recommend reading “Do you believe in the reliability, truth and ability of your suppliers? Do you trust them?

To meet the needs of thoughtful people, Brian Farrington publishes a newsletter “Think Procurement.”

It’s free. See bottom of the page for a quick and easy sign up.


Why Brian Farrington?

There are three themes that clients tell us over and over again.

First, they tell us they believe they are making a smarter investment working with Brian Farrington Ltd — bringing a thorough understanding of their procurement and supply chain issues and a proven track record of enabling excellent returns on their investment.

Second, our clients are confident that they are working with specialists that bring experience, expertise and stay focused on client success; not on our next income target.

Finally, people –people just like you – tell us they actually like working with us. They find us easy to work with and collaborative in solving issues that inevitably arise in procurement.

About Brian Farrington 
Brian Farrington is one of the world’s longest established procurement and supply chain consultancy and executive training specialists. 33 of the current FTSE100 have retained our services, as well as leading organisations in the UK, North America, southern Africa and Asia. Established in 1978, we have proven expertise and experience in procurement, risk and negotiation.

Brian Farrington solutions and services are formed through consultancy, training & development and coaching – all underpinned by proprietary technology. Our four core areas of procurement capability are:

•Strategic review and commercial governance

•Performance delivery and transition

•Major project support including contract negotiations

•Learning & development in support of organisational aims.

Let’s connect on Twitter and LinkedIn


2 Responses

  1. Tuesday, March 4th, 2014 at 12:17 pm

    […] […]

  2. Tuesday, March 4th, 2014 at 9:07 am

    […] – The evolution of risk management For more information and instant access to the free demo site please contact Ray Gambell on […]