A sole-source chemical supplier files for bankruptcy, and the water plant team says 'that's procurement's issue' and leaves it off the register. What should they recognize?
Select an answer to reveal the explanation.
Short Explanation
When your only chemical vendor goes under, treatment trains do not care whose budget code owns the PO. Supplier failure is an external threat to operations—put it on the register.
Full Explanation
External supplier threats include bankruptcy, capacity loss, and sole-source failure that interrupt inputs critical to objectives. Delegating the issue solely to procurement without risk registration leaves continuity gaps. Diversification, buffers, and alternate qualification are treatment options once the threat is visible. Operational owners must track supplier dependency as enterprise risk.