Supply Chain Recovery: Increasing Results While Minimizing Risk

In today's tightly interwoven supply chains, a problem with the timely delivery or performance of components and parts provided by a supplier can have a big impact on a manufacturer, potentially causing production disruptions, reputational harm, costly recalls, and warranty claims. This is leading to more disputes over contract terms, the price and performance of parts and, in some cases, litigation. But a manufacturer need not shoulder the burden of these disputes alone. It can seek, and often achieve, the recovery of funds, all while taking care to manage its often delicate and valuable supplier relationships.

Faced with those realities, some companies are establishing formal "supply chain recovery" capabilities, typically spearheaded by the legal department. These groups take a systematic approach to supplier disputes, from the initial stages of the dispute with the supplier to the attempted negotiation of the issues and, if necessary, through to litigation. They