Using specialized tools to mitigate procurement risk management involves leveraging technology and software solutions to identify, monitor, and reduce potential risks throughout the procurement process. These tools help organizations automate data collection, track supplier performance, flag compliance issues, and gain visibility into supply chain vulnerabilities. By providing real-time insights and analytics, these tools support informed decision-making and allow for early detection of risks, enabling companies to respond proactively and maintain a resilient procurement strategy.
Here is an example of a Risk Index you can create to help evaluate procurement decisions. Check out the article linked below for more information on how to create a new Risk Index:
Risk Index Management in BOMs
Stock
| Condition | Risk |
| No Data | 60 |
| Stock = 0 | 80 |
Stock History Trend Since Last Month %
| Condition | Risk |
| Stock History Trend Since Last Month % < -50 | 80 |
Price History Trend Since Last Month %
| Condition | Risk |
| Price History Trend Since Last Month % > 20 | 80 |
Number of suppliers
| Condition | Risk |
| No Data | 80 |
| Number of suppliers = 1 | 80 |
| Number of suppliers > 1 AND Number of suppliers < 5 | 45 |
| Number of suppliers >= 5 | 0 |
Supplier Performance Rating
| Condition | Risk |
| No Data | 50 |
| Supplier Performance Rating < 80 | 60 |
| Supplier Performance Rating < 60 | 80 |