Top Regulations to Monitor for Ethical Supply Chains

In today’s global supply chain, risk assessment is among the most critical survival skills brands and retailers can possess. For companies with production facilities in faraway places, technical audits are an important tool to evaluate if vendors and factories have the appropriate internal manufacturing processes and quality control systems to deliver high-quality products and maintain responsible production practices.
“Manufacturers’ supply chains are highly complex and continuously exposed to a variety of risks, emanating from within and outside of their value chains. […] There are also extended value chain risks related to third-party service providers, and operational risks related to development planning, sourcing, production, and distribution.”
– Deloitte
Given this reality, conducting frequent technical audits in remote manufacturing operations can help identify and mitigate risk early on, ultimately improving the performance of your supply chain.
Technical audits are an important part of an organization’s broader compliance strategy. When implemented correctly, they provide valuable data to stakeholders about how well their processes run, as well as the ability to:
When talking about technical audits, the accurate and complete reporting of results must be of the highest priority. Through the evaluation of reports, the relevant stakeholders can obtain visibility over their global operations, gain valuable insights about the state of the facilities they work with (or plan to work with), and implement corrective action plans.
A technical audit can be executed at any stage of production to evaluate efficiency in manufacturing and in technical processes. Examples include:
Is the vendor or factory facility prepared for production and able to meet your standards and production needs?
Are the facility’s technical operations being implemented correctly?
After you’ve worked with a vendor or factory for some time, are they sustaining their technical capabilities to continue doing business with you?
In meeting these capabilities, technical audits deliver immense benefits to brands and retailers. In addition to “identifying potential problems early in the course of a project,” as noted by the EPA, they also allow brands to improve their quality of service, assure future revenue, and ensure production is both transparent and cost-effective. This allows production timelines and budgets to be met while optimizing the overall performance of partner facilities.
All of this contributes to brand reputation, which a comprehensive study by Deloitte found to be the most important quality for future competitiveness.
Despite being a key ingredient to successful risk mitigation, several challenges plague the technical audit process — particularly when done by conventional means and at a global scale. These challenges are associated with the different stages of audits:
In this initial stage, you make the decision to conduct an audit and establish which facilities and processes will be targeted. It is essential to establish clear objectives of what must be accomplished at the end of the audit (For example, obtaining a certification, improving current systems or evaluating the correct implementation of standard operating procedures).
Typically, this stage includes pre-audit meetings in which you align on goals and review previous factory audit reports. At this stage you must also make sure the audit team is aware and prepared to conduct the audit successfully (whether the audit will be conducted by your internal team or a third-party agency).
This is the stage in which auditors go into the field and conduct the audits. This can take several days to several weeks, depending on scale. The most important goal is to collect meaningful data that will allow the auditor to assess the state of the facility and report back.
The auditor compiles the results of the audit and communicates findings with the relevant stakeholders. Efficiently communicating the results of an audit makes it easier to analyze information and ultimately accomplish the goal of the audit.
Challenges at the results stage:
The follow-up phase includes future monitoring and analytics to ensure CAPAs are implemented effectively before closing them out.
Challenges at the follow-up stage:
The multitude of challenges with conducting technical audits at a global scale have made them ripe for digital transformation — and indeed, digital audits have proven to be the way forward.
As MIT Sloan writes, the new era of digital audit systems “automates the factory inspection process while tailoring it to specific inputs,” delivering “analytical capabilities that are beyond the classic audit model.” Digital factory audits offer far superior risk management, allowing organizations to analyze the manufacturing operations of remote partners with novel clarity. Naturally, it follows that these audits “also can deliver cost savings and process improvements.”
Here is how a digital solution addresses the aforementioned challenges at different stages of technical audits:
To fix the problems of audit/supply chain mapping, digitization enables you to:
To address the problems of monitoring and ensuring audit integrity, digital solutions give you the capability to:
Digital platforms address the challenges of decentralized reporting and lack of actionable insights by giving you:
To address the lack of visibility on whether CAPAs are being implemented, digitization enables you to:
Inspectorio Rise helps you to maximize the impact of your technical audits while reducing the resources required to perform them. As explained by MIT Sloan, digitizing the audit process provides “new insights into the efficiency of remote manufacturing operations.”
Inspectorio Rise helps you digitize, standardize, and centralize the audit process so you can transform the way in which you manage technical audits.
With real-time data collection and reporting, data analytics, and collaborative features, Rise connects your supply chain on one platform and creates new levels of traceability and visibility.
Contact us to learn more about how Rise can help your organization.