Empty shelves - a symptom of supply chain irrelevance?
During the early stages of the outbreak and subsequent start of the pandemic in 2020, consumer buying behavior dramatically shifted, creating empty shelves in many stores around the world. A seemingly never-ending list of significant disruptive events have continued since, including geopolitical conflict, climate and energy crises, cyberattacks and shipping failures. Each event has taken its own toll as supply chains have struggled to adapt and deliver, with a risk of losing relevance.
Relevance as a supply chain principle
A common definition of relevance is the quality or state of being closely connected or appropriate. If your supply chain isn’t well connected or appropriate for the newly disrupted environment, then your supply chain will no longer be relevant and your business will be at risk. Clearly supply chain effectiveness is dependent on remaining relevant.
How do you establish relevance as a supply chain principle for your business?
There are many applicable practices, but I will focus on one practice for small to medium-sized businesses (SMBs) and one practice for large enterprises.
Planning techniques to help SMBs stay relevant:
Disruptive events can quickly turn a smooth-running supply chain into a fire fight focused on chasing orders. While many supply chain professionals are experienced in emergency response, SMBs typically have fewer specialist resources and can quickly become overwhelmed by a supply chain disruption.
Planning is one of the first processes to target for improvement. Five techniques can be implemented to prepare for disruption:
Evaluate customer buying behaviors creating segments for common characteristics
Design an appropriate planning process for each segment
Identify capacity required to support each segment
Establish a planning rhythm capable of adjusting from monthly to weekly to daily depending on the level of disruption
Collaborate with customers and suppliers sharing key information in a timely fashion
By improving the planning capability, SMBs will increase their adaptability allowing for them to remain relevant in a changing environment.
Emerging technology to help large enterprises stay relevant:
Large enterprises are more likely to have dedicated supply chain resources trained in the plan, source, manufacturing, and delivery processes. Enterprise resource planning systems are typically installed providing transactional data to support analysis and decision making. However, these larger resource teams and systems can become rigid in their response to a disruption and may lack access to real-time information from the edge of their supply chain.
Emerging technologies can help large enterprises access critical real-time data. While capability continues to improve, tech in the following areas has gained significant traction:
Labels and tags with sensors tracking location and monitoring conditions provide data as product moves through the supply chain
Cloud based data platforms consolidate data from multiple sources providing end to end supply chain visibility
Control towers can generate alerts, analytics, predictions, and recommendations to support supply chain execution
Each large enterprise should evaluate where they are most susceptible to failure in a disruption and identify what people, process, or technology improvement is necessary to reduce their failure risk. As technology continues to accelerate development and capability, the practice of evaluating emerging tech for applicability within the business can help leapfrog performance hurdles.
Whether your company is an SMB trying to remain relevant in a changing environment or an emerging supply chain tech company trying to reach large enterprises, Lesser Supply Chain (LSC) can support you to achieve your goals.
Contact us today to learn how to establish relevance as a supply chain principle within your business.