How manufacturers in Singapore can future-proof their businesses: An external perspective

Despite new challenges, heightened exposures and evolving risk profiles, many local manufacturers, particularly the small and medium-sized enterprises (SMEs), often take a reactive approach to managing risks. This lack of preparedness can cost them money and time, and even lead to business failure for smaller manufacturers. 

In the face of potential disruptions, the first step to protecting your business is understanding what makes it vulnerable. It is critical to examine your business through the lens of the questions outlined below to gauge your readiness for the next crisis, no matter how big or small.

A modern factory may be more vulnerable to cyber threats than ever. Every digital touchpoint - from the network of connected devices on assembly lines right down to the small sensors installed in the final products - could expose your company to external cyber risks. Are you prepared for the worst?
 

• Have you created or updated your cyber incident response plan?
• Are you routinely testing your defenses and threat hunting to intercept potential cyber-attack attempts?
• Do you conduct structured reviews of the security levels of third parties and vendors you work with to ensure they have robust cyber security measures and policies in place?
• How prepared are you for business interruption, reputational damage and expenses that might arise from a cybersecurity incident?
• Are you confident that your existing insurance policies are enough to cover data security and privacy exposures?

Dependence on external suppliers is a significant source of exposure - the supply chain has many moving parts, and every vendor has its own set of vulnerabilities. Have you done enough to boost resilience of your…

Here are a few essential risk management best practices that every manufacturer should consider implementing:
 

• Put in place a robust risk management program and business continuity plan (BCP). If you don't currently have one, here are 5 steps to creating a BCP. If you do, be sure to routinely review, update, and adjust the plan. 
• Make sure you have the necessary coverage to absorb the negative impact of a cyber-attack and help your company quickly bounce back into action after an incident.
• Maintain an inventory of critical materials and keep a safety stock of supplies for short-term interruptions such as unexpected shortages of materials and supplies. This is especially important if you run on just-in-time or on-demand production schedules. 
• Collaborate with a risk specialist to create tailored insurance strategies that can help protect your company's operations and business performance.
   

After more than a year of dealing with pandemic-related and other disruptions, local manufacturers have begun to appreciate the importance of being prepared to tackle issues confidently. To navigate an uncertain future, manufacturers must be more attuned to the value of risk management, assess what they have in place as well as what's needed to address emerging risks.

Now is the time to prioritise risk management and not leave it on the table or to chance.

Not sure how to get a head start in assessing and/or managing existing and emerging risks specific to your organisation? Speak to your insurance broker/agent or our risk experts to ensure you are prepared and ready for any eventuality.