Gain Agility, Speed and Resiliency in your Responses to Supply Chain Disruptions
When businesses expand their supply chains globally, risks increase. Risks include geopolitical challenges, economic uncertainty, and demand/supply volatility. With longer supply chains, lead times grow, orders become more complex and product quality issues may arise. Conducting commerce on a Supply Chain Operating Network will decrease the likeliness that these disruptions will significantly disrupt your business.
To expertly account for supply chain risk...
- Understand the risk environment by identifying and assessing current risk, quantifying and prioritizing it, then developing a risk mitigation strategy.
- Diversify your suppliers so that you can have access to equivalent materials if something happens in one country versus another or with one supplier versus another. Easy to do on a network.
- Optimize inventory buffers and safety stock levels so that you have enough supplies to keep on producing.
- Identify potentially disruptive supply chain events involving suppliers, production, distribution, and demand. Joint planning and collaboration with suppliers and customers will ensure that supply chain risk plans are mutually valuable to all parties.
- Build flexibility into processes so you can promptly adapt to changes with minimum impact.
- Share forecast and demand information with trading partners so you can be more responsive to customer demand fluctuations.
- Increase visibility into supply chain operations so that you can track and monitor supply chain events and patterns as they happen (or even before they happen) to be more proactive in your risk mitigation plans.
The most advanced risk management programs are rooted in preventative measures. The focus is top-down and horizontal - working across silos - and led by a business leader.
Use the Infographic below to explore your risk management strategy.
If you like this post, you may like "Ignoring This Overlooked Risk Management Metric Leads You Down The Path To The Dark Side" which outlines an important, but often overlooked factor, in supply chain risk management.