Shaken by the pandemic but not broken, global supply chains are now well positioned to begin strengthening and becoming more agile for the future.
The ability to rapidly flex or repurpose assets across your supply chain in response to unanticipated supply shocks and competitive shifts—new customer requirements, emerging channels or industry disruptors—supply chain resilience has taken on new meaning over the last 18-20 months.
Forced to deal with more than the usual number of disruptions, interruptions, business shifts and changing customer preferences, organizations need tools that help them with what’s happening in the external environment, across their supply chain networks—and all while continuously pivoting to accommodate change.
Achieving this goal won’t be easy in the context of the current environment plus any unknowns that could be waiting around the next corner. According to a recent report from Kearney and the World Economic Forum (WEF), just 12% of companies are “sufficiently prepared” to manage global supply chain disruptions right now.
“COVID-19 is not the first epidemic to disrupt supply chains—SARS, measles, swine flu, Ebola, and avian flu all resulted in business interruptions—but none of these epidemics disrupted global trade and domestic supply chains as much as COVID-19 [did],” Brookings Institute points out. “The ongoing pandemic has highlighted structural problems in global supply chains.”
Steps to Better Resilience
To become more resilient, Brookings says supply chains must now prepare for and adapt to unexpected events; quickly adjust to sudden disruptive changes that negatively affect supply chain performance; continue functioning during a disruption; and recover quickly to the pre-disruption state (or, a more desirable state).
Getting there will take some work. To companies that want to start building more agile, resilient supply chains now, Brookings suggests following these tenets:
Rapid detection, response, and recovery. “Supply chains need to be able to quickly detect, respond to, and recover from changed conditions,” it says.
End-to-end, data-driven, supply chain control. Supply chain integration, transparency, and visibility are necessary but not sufficient conditions for enhanced resilience. “Being able to view raw materials, semi-finished goods, and finished products starting from your ‘suppliers’ suppliers’ to your ‘customers’ customers’ is more important than ever,” the organization states. “However, to extract value from these data requires action to be taken quickly.”
Preparing for a disruption before it occurs (e.g., planning, scenario planning, war gaming). Understand that it may take months to determine what data to collect and how to convert that data into actions for rapid disruption detection, response and recovery.
Redundancies, including emergency stockpiles, safety stocks, and diversified sourcing from offshored, nearshored, and/or reshored suppliers. “These suppliers must be able to provide additional surge capacity when there are disruptions of supply to ensure business continuity,” Brookings points out.
Other key tenets of resilient supply chains include strong collaboration between private and public stakeholders and effective demand planning processes, the latter of which should center on forecasting/predicting demand for products to ensure that those goods can be delivered and satisfy customers. Brookings sees real-time demand data as another key factor in resilience because it can be used to determine transshipment decisions of raw materials, work-in-progress, and finished products in order to ensure inventories are kept in balance.
Your Ace in the Hole: Real-Time Data
Real-time data also supports high levels of transportation visibility. When companies can view all modes and execute their transportation from a single platform, they can drive risk out of their supply chains and ensure more reliable sources of supply. “If you can readily see that transit times are creeping up and that they could potentially interfere with an on-time shipment,” says Ken Sherman, President at IntelliTrans, “you can make a quick mode change in order to maintain service for a specific customer.”
Making those quick pivots is easy when both modes are in the same place and when both the visibility and execution are handled from that same platform. The same applies to the rising freight rates, which in recent months have also forced many companies to rethink their modes or lanes and develop more efficient transportation approaches. The decisions you made a year ago may not be as applicable now, for example, which means it may be time to compare rail versus truck to determine the best approach.
“When you have the dashboards, data and analysis at your fingertips, you can more readily improve your supply chain resilience through good decision-making and analytics,” says Sherman. “This is theoretically possible using multiple platforms, but it's certainly a heck of a lot easier and more readily available in one place.”
On the flip side of the equation, technology also helps companies improve communications with their customers and carriers, and convey information about inventory, planning and forecasting with those stakeholders. This minimizes last-minute surprises, helps keep supply chains flowing more smoothly and allows for solid contingency planning (when needed). This, in turn, helps strengthen and future-proof global supply chains.
A Technology Platform that Supports Supply Chain Resilience
IntelliTrans’ Global Control Tower provides high levels of supply chain transparency; aggregates, completes, and enhances data from a variety of sources; offers visibility into and execution of different aspects of the supply chain; and generates data-driven alerts and analytics that ask deeper questions and deliver meaningful insights.
By leveraging tracking information, the Global Control Tower provides analytics that measures key performance indicators (KPIs) like fleet cycle time, origin/destination dwell time, lane and hauler performance, back orders, freight spend, load optimization, and more. With their rate, equipment, lease, tracking, and invoice data in a central repository that’s accessible 24/7, companies can position themselves for success in any market conditions.