5 mantras for resilient supply chain in the new normal

There has never been a more suitable time than now to redefine supply chain management with unmatched robustness. The industry has always been vulnerable to disruptions. About half of the organizations seem to have experienced complexities including resource inconsistencies, factory fires, natural disasters and logistical ordeals, almost every year. However, enterprises had never experienced disruptions akin to Covid-19. The new normal has made organizations to look beyond efficiencies and create practices that insulate their businesses from the adverse impact of unforeseen disruptions.

Leaders are now contemplating right choices and strategies to build indestructible supply chains, ensuring business as usual in a post-pandemic world.

5 mantras for resilient supply chain

1. Connect the tiers and enhance transparency

Mitigating the complexities while efficiently managing layers of supply chain operations, demand well established connections between tiers. There is a need for consistent tests to analyze and measure the stress a system endures. A thorough study on the impact and source identification are key in narrowing the gaps between the multiple layers of a complex supply chain. Tying these levels together would increase end-to-end visibility across the system, bringing efficiency in its management.

2. Early threat detection

A savvy supply chain leader must have a holistic view encompassing all macro and micro perspectives to enable early warnings at various levels of supply chain. However, 23.3% organizations do not track or report performance affecting supply chain disruptions. Countering crisis demands that the organizations are cognizant of possible threats and are prepared with mitigation plans. The organization can build resilience with the following best practices:

• Consistent monitoring to identify and asses risks involved
• Collaboration of internal and external risk data for early threat detection
• Simulated supplier collaboration for better visibility

3. Technology adoption for intelligent decisions

The fall of Global Value Chains (GVC) made supply chains dynamic, volatile and complex. Yet, there is a visible hesitance in exploring technology led solutions. 73% organizations still rely on legacy software and spreadsheets for assessing disruptions. A few have invested in multiple supply chain solutions that function in silos which precipitate the complexities, thereby delaying decision making process.

Organizations must adopt and leverage possibilities of available technologies. Modern platforms ensure seamless planning and quick response by enabling real-time visibility of demand and supply. These solutions also provide flexibility to revise responses based on unfolding of events like re-adjusting sourcing plans or re-allocating purchase orders. The simulated scenario planning enables organization to visualize possible threats using advanced technologies and bring down response time for any incident, thus building supply chain resilience.

4. Strategic decisions from evaluated financial impact

Disruptions vary in terms of scale and impact. Based on the urgency of responses, scale and impact of disruptions, decision makers must be empowered to take necessary course of action. Often, it is critical to quantify the potential financial impact. Hence, enterprises must be open to adopt a well-designed financial model that covers all economic aspects of disruptions and thereby make informed strategic decisions.

5. Develop ecosystem for cohesive response to disruptions

A truly resilient organization demands coordinated disruption management across the enterprise. It has been observed that end-to-end supply chain visibility and capability to implement agile strategies is not sufficient for a truly resilient organization. Active cross-functional participation of Sales and Marketing, Finance and HR teams is essential for complete value chain risk assessment. Simulation through connected planning and a well-knit departmental ecosystem serves the bigger purpose.

Building resilience in supply chain management comes with well-designed strategies. ITC Infotech has designed ‘Intelligent Planning for Resilience’ solution for robust supply chain, empowering leaders with advanced analytical capabilities. Building on the foundation of ‘Sense, Plan and Respond’, the solution helps enterprises detect risk at an early stage, predict future scenarios across tiers, gauge financial impact and define agile strategies to withstand disruptions.

This intelligent model leverages AI, ML and cloud platforms to deliver composite solutions that deliver seamless supply chain operations despite disruptions. ITC Infotech has been supporting leaders worldwide in building supply chain management best practices to withstand any challenge, now or in the future.

To discover more on how ITC Infotech is powering Intelligent Supply Chain Planning solutions, read ‘Responding to supply chain uncertainty with strategic agility’.

Author:

Amit Paul
Senior Principal Data Scientist, Digital Experience

Contributors:

Indranil Das
VP Industry Analytics, Digital Experience

Amit Derkar
Senior Manager, Digital Experience

References:

1. Bain and Company, Tracking the Global Impact of the Coronavirus Outbreak : https://www.bain.com/insights/tracking-the-global-impact-of-the-coronavirus-outbreak-snap-chart/
2. BCI Supply Chain Resilience Report 2019 :  https://www.thebci.org/resource/bci-supply-chain-resilience-report-2019.html
3. Resilience Event watch® 2018 Annual Report : https://info.resilinc.com/eventwatch-2018-annual-report