Unit 6: Two Business Scenarios
• Business scenario: Qualitative –
Decision making process to face a disruptive event (recovery)
• Resilient Response
• •Business scenario: Quantitative –
Selection of the most beneficial preparedness
actions to face a computer hacking event (preparedness)
• Resilient Response
Re-formulation of the products composition
In a plastic parts production plant, there were problems with the hardness of the plastic used to manufacture a family of products. Therefore, the production department carried out various tests and concluded that it was necessary to change the formulation in the composition of the products in order to be able to manufacture good quality products and that the plastic would not be brittle. However, this was a decision taken by the production department together with the new product development department, but was not communicated to the purchasing department. As the composition of the product changed, a raw material was consumed in greater quantities, and therefore, during the production of the product family, the production department ran out of raw materials to be able to continue production.
Recovery. Once the purchasing department realised that there was not enough raw material to continue production, it began to investigate why more had been consumed than was actually due to the production plan it had defined. It was then that the purchasing department realised that the composition of the product had changed and had to take a series of actions to recover quickly so that the production lines would be stopped for the least amount of time. To this end, they placed an urgent order with express transport so that the raw material could reach them as soon as possible.
Preparedness. From this moment on, and so that this event would not happen again, every time the production department together with the new product development department modifies a product composition, a protocol has been defined so that an alarm is triggered in the purchasing department and the new product compositions are automatically updated so that purchasing can accurately plan the purchase of raw materials. A warning is also triggered in the finance department to analyse the cost impact of the new formulation on the product composition.
Summary and Takeaways
1.Based on the recovery and preparedness actions, it is more advisable to act as proactively as possible in order to avoid last-minute recovery actions.
2.It is recommendable to ask yourself what happens if… and then analyse the impact to take the proper decisions.
Check your understanding
1 Do you think there were more appropriate actions to recover from the lack of presence of office workers in the administrative department?
2 In addition to the purchasing department, which other departments do you think should be informed about the reformulation of product composition?