Prewave enables us to manage risks in a targeted manner – even in the lower-level supply chains. For us, this is about transparency. Artificial Intelligence simplifies the complex analysis of data, allowing us to address partners directly and request improvements in sustainability. The goal is to achieve this in partnership with suppliers. In the event of escalation, however, termination of business relations is certainly also an option.
Recent years have brought transformative changes to the automotive industry, driven by disruptions like the COVID-19 pandemic and semiconductor shortage, along with innovative shifts towards sustainability. Legislation promoting transparency in supply chains further influences this evolving landscape, impacting manufacturers, suppliers, and service providers of all sizes.
Fostering resilience in the automotive sector is crucial for withstanding disruptions. Rapid adaptation and ensuring continuous operations are key in reducing the impact of disruptions, facilitating a swift recovery and maintaining industry stability. Developing robust strategies for resilience enhances the industry’s ability to navigate challenges, ensuring sustained operations even in the face of unexpected events.
The automotive sector grapples with a diverse range of regulatory requirements, including environmental, safety, and labor standards. Meeting these obligations requires a balance between compliance and operational efficiency, as well as investments in sustainable practices and attention to operational processes. Examples of regulatory standards include the EU’s Corporate Sustainability Due Diligence Directive (CSDDD), the German Supply Chain Act (LkSG), the Norwegian Transparency Act (NTA), and more. Failure to ensure regulatory compliance can result in significant penalties, which can vary significantly—depending on the legislation the company falls under
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Prewave’s risk matrix minimizes business interruptions by aligning a company’s risk with supplier spending, prioritizing efforts on high-risk and crucial suppliers. In line with global standards such as the German Supply Chain Act (LkSG) and the EU’s Corporate Sustainability Due Diligence Directive (CSDDD), the model’s core objective is transitioning suppliers from high-risk, high-expenditure to a low-risk zone, reducing overall supply chain risks. Utilizing Kärcher’s metrics, notable impacts include a 3-day faster reaction time with Prewave AI’s proactive alerting and a 40-fold reduction in effort through automated processes. This streamlined approach mitigates both reputational risks, as seen in battery sourcing in mining, and operational challenges like semiconductor shortages or logistical disruptions.
The Prewave Action Platform enables the prompt implementation of appropriate preventive and corrective measures. Utilizing a global network of partners, activities like on-site audits, training, and assessments can be seamlessly and efficiently executed on a global scale. The results of these actions are then incorporated into the comprehensive 360° score, facilitating the strategic advancement of suppliers along the risk matrix. This proactive approach promotes progress, risk mitigation, and continuous improvement within a company’s supply chain.
Analyzing massive amounts of data using artificial intelligence highlights how digitalization can uncover risks in our supply chain.Thanks to our collaboration with Prewave, we are using an adaptive, powerful tool to increase transparency and efficiently monitor sustainability agreements.
Prewave has transformed our supplier risk management at Magna International. With the ability to assess over 150 different risks across our entire supply base, we now make more informed business decisions and efficiently check for risks in the ESG realm. The communication and collaboration with our suppliers have significantly improved, aligning with our commitment to an ethically sensitive environment. Prewave’s time-saving capabilities and reliable data make it an excellent tool for us, enhancing productivity on a scale that would otherwise require an enormous workforce. It’s a game-changer for us at Magna International.
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