Tips to Mitigate Risk
Here are some tips and best practices that you can follow to mitigate risks in the optical supply chain:
Manage Environmental Risk
Environmental risk is defined as any risk to your supply chain that is posed due to the location(s) of your vendors. For example, a hurricane that forces coastal vendors to shut down would be one instance of environmental supply chain risk. While it isn’t always possible to prevent this type of risk outright, you can prepare for environmental risk by using supply chain risk assessment to help you develop a contingency plan that can be put in place should one of your high-risk vendors pause their operations.
Ensure Vendors Practice Appropriate Cybersecurity
The threats posed by cyber-attacks are a growing concern for businesses in almost every industry. By ensuring that all of your vendors practice appropriate cybersecurity, you can prevent supply chain interruptions caused by ransomware and other cyber-attacks.
Implement Contingency Plans
It’s never a good idea to be completely reliant on any one vendor or group of vendors. By implementing multiple contingency plans, you can create a flexible supply chain that can quickly adapt in the event of a disruption.
Use Data Models
Data modeling and predictive analytics enable you to highlight potential points of risk in your supply chain and forecast what would happen in various “worst-case scenarios”. Data modeling can help you mitigate supply chain risks by providing the information needed to create appropriate contingency plans.
Prioritize by Probability/Impact
Once you’ve identified your potential risk factors, you will want to prioritize those risk factors based on their probability and potential impact on your business. The risk factors that rank the highest in terms of probability/impact are the ones that you should prepare for the most in your contingency plans.
Second sourcing (also known as dual sourcing) is the practice of using two different vendors for each material, component, or service that your business relies on. This practice ensures that you always have a vendor ready to pick up the slack if one of your vendors is not able to meet your needs.
Forming excellent relationships with your suppliers is an important part of managing supply chain risk. By working closely with your vendors and communicating with them effectively, you can ensure that there aren’t any disruptions due to miscommunication. Forming close relationships also makes it easy to create solutions if issues arise.
Consider Geographic Location
The geographic location of your vendors is a major factor when it comes to predicting how much risk they pose to your supply chain. If a vendor is located in an area where geopolitical risk factors are high then they should be treated as a high-risk element of your supply chain. It’s also important not to cluster suppliers.
Identify Substitute Materials When Possible
Being able to substitute vital materials in your supply chain isn’t always possible; however, if you can identify substitute materials, this is a great way to mitigate supply chain risks. Substitutes enable your business to pivot to a new material if your primary material isn’t available. Substituting optical glasses, in particular, is often possible because the glass manufacturers publish tables of equivalent glass types.
Transfer Some Risk Via Insurance
One great way to offset some supply chain risk is to purchase supply chain insurance. Supply chain insurance is available from a variety of providers and is designed to cover non-physical damages that your business incurs as a result of supply chain disruptions.
Rely on JML Optical
Mitigating supply chain risk is essential if you want to keep your optic supply chain healthy and ensure that there are no major disruptions to your business. Of course, working with the right vendors is one of the most important ways to reduce the risk of supply chain disruptions.
JML Optical has nearly 50 years of experience developing a network of vendors for metal parts, bulk optical glass, and high-volume components that we use to make optical assemblies. Many of our customers appreciate that we offer a single point of contact to manage the entire supply chain necessary to supply the optical solutions they need. Our experience reduces risk for our customers.
At JML Optical, we are proud to provide world-class design, manufacturing, and assembly of precision glass optics. If you are looking for an optics vendor that you can always rely on, JML Optical has what you need. To learn more about working with JML Optical for all of your precision glass optics manufacturing needs, be sure to contact us today.