Even The CFO Is Focused On Risk!

Authored by Mickey North Rizza
  
Risk continues to be a hot topic for businesses; but like the old adage about EF Hutton, when the CFO starts talking, people start listening — or in this case, start strategizing for the future.

At a recent Wall Street Journal CFO Network Conference, attendees noted four critical aspects to prepare for global business risks: Thinking regionally; Cyber-security; Manage the supply chain; and Interrelated risks. Each area was well defined, but also left some room for further thought.

Think Regionally – Companies should align strategies with governments of countries in which they operate and spend more time developing regional (not global growth plans). A prime example is Chip Starnes, CEO of Specialty Medical Supplies, who was literally held captive by his Beijing workforce. The workers were upset because the employees did not believe they were treated fairly. The company moved part of its Chinese factory to India, laid off 35 Chinese workers whom all received severance packages. But according to the workers, the company didn’t guarantee the remaining employees who are still employed the same severance package.

Cybersecurity – Companies should tackle their own threats, push for government intervention and seek pacts between governments on the issue. There should be a limit on who has access to information. The recent US Government concerns over the National Security Agencies issues with Edward Snowden are just the tip of the iceberg on security, not to mention the intelligence and cyber concerns created by this debacle.

Manage Supply Chain – The supply chain should be part of a regular risk assessment and have redundancy built in. Also companies need to assess risks in business processes, so that fragility and volatility of regional economies is understood. Many companies are shortening their supply chains with localization efforts that provide more flexibility to manage demand and supply, thus reducing exposure.

Interrelated Risks – Risks don’t necessarily come as discrete events, so companies must be prepared for multiple events. The senior level management teams need to tackle these issues. Businesses know that cause and effect is all part of their everyday performance. Most concerns are interrelated such as demand falling off, create less need of supply, reducing revenue and hurting performance.

 
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The historical review and ideology of ERP (Part 2)

Authored by Junaid Khan

An Enterprise is a group of people with a common goal, having resources to achieve that goal; resources include money, manpower, material, machines, technologies, etc. Whereas planning is a necessary tool which hooks up all resources together. Enterprise Resource Planning (ERP) provide platform to integrate all the business processes of different departments and functions across a company onto a single computer system that can serve particular needs of the different departments. ERP combines all the business requirements of the company together into a single, integrated software program that runs off a single database so that various departments can share information and communicate with each other to accomplish the departmental / organizational objectives. The concept of ERP evolved during the last 40 years and today it is considered as an important requirement to align the operations of business with best practices of the industry as the modern techniques from Supply Chain, Accounting and Finance, Manufacturing and Operations segments have been incorporated in the available ERPs.