Although the BoneFix team found an excellent primary supplier (CamTech), they did not sufficiently vet the vendor beyond visual inspection. Smell issues were only discovered after production, when it was late to pivot. Additionally, while they did find a second vendor (UltraMex), leadership’s immediate cost concerns overrode strategic contingency planning. As a result, if the CamTech pouches are deemed unusable, BoneFix has limited fallback options. Contingency vendors are vital, and it is important to balance cost with quality assurance and risk mitigation.
A smart move could have been qualifying two vendors equally from the start, splitting the initial order, or at least conducting parallel risk testing on both vendors. This would have preserved leverage and mitigated potential disruption.
In high-stakes projects, how do you convince management that investing slightly more upfront in contingency planning can prevent massive downstream costs?
I think management needs to realize the importance of risk management and enacting contingency plans. Whatever can go wrong will go wrong. This is not to have a negative view on everything, but instead taking precaution in project development. Yes, you may be spending more money and time in the beginning, but it avoids a huge potential headache down the road. Contingency plans reinforce the idea that the project will continue even if problems do occur. If there are no contingency plans in place, you are spending a lot of money and time when the problem occurs. Management might as well cover all of the risks from the start.
Also, highlighting the cost of setting contingency plans versus the cost of problems arising with no contingency plans in place could be a huge benefit. I think reality would sit in with management and help them come to terms that contingency plans are necessary to avoid massive downstream costs.
