Jim Lawton, senior vice president and general manager of supply management solutions at the Dun & Bradstreet Corp. (D&B), recalls a conversation in which he told a client's chief procurement officer that a supplier of the client company had been slapped with an EPA violation for mismanaging radioactive material.

The chief procurement officer promptly left the room.

"He got up from the table and said, 'Look Jim, I'm very interested in continuing this conversation -- I'll reach out to you to do it right away -- but I have to go,'" Lawton explains. "That information was that critical to him, and he had no idea it was there."

Experts say the increasing globalization and complexity of supply chains has put too many manufacturing executives in similar shoes -- out of the loop when it comes to important financial, performance, legal and compliance information on their suppliers.

"We work with a lot of companies that find out about [supplier] bankruptcies months after they happen," Lawton says. "Or they learn about them, but not in time to be able to continue to make sure they have parts coming into their facilities, and then all of a sudden they're not able to build the product that they need to ship to their customers."

Lawton notes that the collapse of the economy has precipitated supplier bankruptcies "in traditionally strong companies in all kinds of industries where you weren't expecting them," serving as a wake-up call to the importance of having real-time insight into the potential risks posed by suppliers.

"One of the lessons learned … was that we often do a very good job of looking at the creditworthiness of our customers and their ability to pay us, but we don't do as good a job looking at the financial wherewithal of our suppliers," says Tom Murphy, executive vice president of manufacturing and wholesale distribution for the professional services firm RSM McGladrey Inc. "It's a very, very difficult lesson to learn."

Still, it's a lesson that manufacturers seem to be taking to heart. Lawton estimates that at least one-third of his clients now are taking steps to improve their supply chain visibility, compared with fewer than 5% of his clients two years ago. Tim Hanley, vice chairman and leader of Deloitte & Touche LLP's U.S. Process & Industrial Products group, says "no one I'm working with isn't having a fresh look at their supply chain."

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