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Resilient Supply Chains in a Politically Uncertain World

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Resilient Supply Chains in a Politically Uncertain World

Resilient Supply Chains in a Politically Uncertain World

The Resilient Supply Chain

Today, the supply chain world iterates faster than at any other point in history. Disruptions – whether related to climate change, trade wars, or a no-deal Brexit – are a given, and black swan events aren’t surprises anymore. We know that the next event is coming fast and supply chains will have to react. So why have we not burned that understanding into our business DNA? Why are we still trying to leverage strategies developed 50 years ago and technologies unaligned to today’s needs?

What I mean is that every supply chain, everywhere, should be prepared at a moment’s notice to shut down, pivot, and spin up whatever operations it needs to, wherever it needs them. I’m of the strong opinion that if supply chain professionals reframe their thinking and look at uncertainties as opportunities then they will thrive. This thought came to me while reading an article on US trade disputes with China, or maybe it was an article on Brexit.

While I understand how conflicts arise, I have a hard time accepting why they are as adversely impactful to supply chains as they are. Contingency planning should cover for every possibility, and the overreliance on any single supplier or region is not smart business anymore. If the year was 1492 or 1839 or 1979, I could understand the desire to optimize a linear supply chain. That’s not the case today. With the advent of cloud technology and the reality of global markets – fallout from any one country’s instability or trade war can be mitigated.

Three Legs of a Resilient Supply Chain:

  1. Availability: For systems to work they need to be ON. As long as power and cloud servers exist, then a supply chain cannot be existentially threatened.
  2. Operational Flexibility and Configuration: Facilities available on a single network eliminate siloes and allow for customized configuration.
  3. More Control: Control is based on visibility, on knowing and seeing exactly where inventory is all the time.

What About Lost Goods?

Declare them lost, minimize losses, and deal with the repercussions.

Over the last two generations, western economies relied on an uncompetitive market to produce goods. Since 2010 the world has effectively been relying on an industrial monopoly.

It may have seemed like a good idea to rely on a single, cheap source of manufacturing fifty years ago. However, by choosing this path, countries damaged their own manufacturing economies.

They also exposed themselves to the exclusive possession and control of that same, supplier. That’s when the system naturally started to collapse. And that’s when the world began to see price-fixing and currency manipulation, among other signs of deterioration. What would you do if you ran a monopoly?

A dearth of suppliers is what companies are now contending with. There is no easy way out.

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The Emerging Business of Supply Chain Risk Management

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For many organizations, globalization, outsourcing, and extended supply chains are effective strategies to increase efficiency and achieve economies of scale, however, these benefits are accompanied by the significantly increased risk to quality, safety, business continuity, reputation, and more.

Is Your Company Safe to Work With?

As reported by Forbes, there’s an emerging category of business – supply chain risk management – of which many companies aren’t yet aware.

For the largest companies, this is a jugular area – imagine the exposure of a large oil company or a large online retailer when a supplier they’ve contracted with makes a mistake or even causes an all-out disaster? (Think oil drilling contractor, for example.)

Risk Management Overview

For many organizations, globalization, outsourcing, and extended supply chains are effective strategies to increase efficiency and achieve economies of scale.

However, these benefits are accompanied by the significantly increased risk of quality, safety, business continuity, reputation, and more.

Identifying Risk in the Supply Chain

Organizations are always at risk for losses through cost volatility, supply disruption, non-compliance fines, and safety incidents that cause damage to their brand and reputation.

Knowing what’s at stake is the first step to understanding, measuring, and managing risk in your supply chain.

Supply Chain Safety

Among the highest priorities for companies across all industries, safety concerns are often magnified in chemical, oil and gas, construction, and manufacturing.

Workplace accidents can jeopardize contracts, result in fines, and cause significant damage to a company’s reputation.

Supply Chain Quality Control

Do your vendors and suppliers meet your standards for quality and consistency?

Customers are quick to react when they perceive a drop in quality; and, even the smallest product issues can be difficult to recover from.

Supply Chain Financial Challenges

Any disruption to the supply chain due to financial challenges has the potential to impact business continuity and, ultimately, your bottom line.

Taking a proactive approach to understanding supplier financial strength can prevent disruption and unnecessary costs.

Supply Chain Compliance

Are your contractors insured? Do they have the right type of insurance, the right limits?

Knowing this information will help you to manage insurance risk and avoid potentially costly litigation.

Supply Chain Reputation

Damage to a company’s brand or reputation can be long-lasting, extremely costly, and sometimes unrecoverable.

Committing to a supply chain risk management strategy can not only prevent brand damage but can also serve to foster new partnerships with organizations that share like values.

Supply Chain Sustainability

It’s no longer enough to assess risk within the traditional construct of a supply chain.

Organizations must look beyond and consider environmental impacts and corporate social responsibility, including adherence to labor laws and sustainable practices.

Read more at The Emerging Business of Supply Chain Risk Management

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The Partnership for Supply Chain Management Implements One Network’s Control Tower Solution

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One Network Enterprises, a global provider of multi-party digital network platform and services, recently announced that The Partnership for Supply Chain Management (PFSCM)—a nonprofit organization providing global procurement and distribution services for low- and middle-income countries—has implemented One Network’s Supply Chain Control Tower solution to advance its end-to-end supply chain visibility.

According to spokesmen, PFSCM has a long history of innovating and driving fundamental improvements in the performance of global health supply chains.

Spokesmen added that it is migrating critical requisition, order, and transportation management functions into its existing One Network Real Time Value Network (RTVN) decision-making supply chain suite.

“Our goal is to strengthen, develop, and manage secure, reliable, cost-effective, and sustainable global supply chains to improve the lives of people in underdeveloped countries,” said Richard Owens, PFSCM Director. “By extending One Network’s Control Tower capabilities on our RTVN, we can provide real-time visibility, digital collaboration, and advanced analytics to move to true data-driven decision-making. Our collaboration with One Network is central to PFSCM’s digital transformation and provides us the foundation we need to drive the next wave of innovation within global supply chains for public health.”

In an interview with SCMR, Owens said that PFSCM first conducted an internal evaluation of its existing systems, plus a landscape analysis of what potential solutions existed before making the deal.

“The evaluation produced six scenarios, consisting of different combination of three systems,” he said. “The first recommendation was to go with One Network, which was accepted first by PFSCM’s management team, and then by PFSCM’s Board, who approved the project budget last September.

Read more at The Partnership for Supply Chain Management Implements One Network’s Control Tower Solution

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Close the Loop on Supply Chain Risk: 5 Strategies to Move Product, Boost Sales and Automate Efficiency

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Supply chain management is a critical function for any small to mid-sized business. Yet, too often companies rely on spreadsheets to manage supply chain activities — a risky prospect that’s labor-intensive and error-prone.

A better option is to bring these activities into your financial management or ERP system. Centralizing tasks such as order filling, inventory management and delivery tracking can positively impact sales, improve cash flow and keep you tax compliant.

Here are five ways that ERP supply chain management benefits your bottom line.

Right-sized Inventory

Getting inventory right can be tricky: too low, you risk losing customers; too high and you’re left holding the bag, so to speak.

Control Quality

Dealing with defective materials or products can be a drain on your business. Not only can it hurt sales, but it can also damage your reputation.

Optimize Shipping

Web sales have made fast, affordable shipping a must-do for all businesses. Keeping track of goods coming and going can become burdensome, not to mention the hassle of dealing with lost or late shipments.

Improve Cash Flow

Invoicing practices can greatly impact your cash flow. Moving from a manual process to automation allows you to process invoices faster and shorten the order-to-cash cycle.

Be Compliant

Navigating complex and ever-changing trade and tax rules can be daunting. Being part of a supply chain compounds that risk.

 

Read more at Close the Loop on Supply Chain Risk: 5 Strategies to Move Product, Boost Sales and Automate Efficiency

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