As the coronavirus pandemic continues to unfold around the world, many organizations have felt the immediate shock as their supply chains stress over the implemented measures and fluctuating restrictions and demands.
For many organizations, the crisis exposed some of the cracks in their systems. Some have been able to mitigate risks and stay afloat, waiting out the storm before they begin to implement those much-needed improvements.
“Waiting out the storm" will not be the best option.
Here's why the time is now to prepare and invest in your supply chain optimization.
Make the invisible visible
Lack of supply chain visibility and access to information across global teams can have severe consequences that range from uncoordinated crisis response to high customer attrition- which would ultimately lead to a more significant impact on the bottom line.
And therein lies the importance of understanding your supply chain dynamics, measure your supplier performance and improve overall predictability.
Inbound supply chain control is a critical capability that will determine not only how an organization will come out of the crisis, but how they will continue to thrive, rather than struggle to keep control.
Having a better understanding of supply networks can also help organizations strengthen the relationships with suppliers and will ultimately benefit the entire ecosystem to adapt and evolve throughout economic ups and downs.
Only as good as what your supplier can deliver on time
The coronavirus epidemic has caused significant shifts in consumer buying patterns. Retail industries, in particular, have experienced the hoarding of specific goods.
When a lack of visibility and poor collaboration between organizations and suppliers run rampant, the response to these new purchasing patterns may lead to a bullwhip effect, a costly consequence, not many businesses can afford today.
Therefore, strong supplier relationships can provide a pivotal foundation that allows for mutually beneficial agility that will mitigate adverse effects. And this is not limited to retail.
For instance, a McKinsey report advises how "manufacturers should engage with all of their suppliers, across all tiers, to form a series of joint agreements to monitor lead times and inventory levels."
Monitoring these metrics through various types of collaborative performance dashboards can provide an invaluable resource, not only to provide early warning signals but to build stronger, longer-lasting partnerships.
Kris Van Ransbeek, VP Customer Engagement at Streamside states, "your organization can only be as good as what your supplier delivers. That will ultimately define how well you'll be able to serve your end customers."
The paradigm shifted, and the proof is here
Digitization is and will continue to be a hot topic in the supply chain world. Some industries are ahead, and some still lag. But thanks to this crisis, one thing is certain. When it comes to digitization, there is no going back.
With social distancing threatening efficient workforce interaction, tools that enable remote work are on the rise. And these are not limited to the typical teleconferencing and online communication technologies.
It is a new era of digital community platforms. These are digital tools that connect multiple stakeholders across the supply chain, enabling the collection, analysis, and reporting of data, including the real-time kind.
Supply chains in some industries have been notoriously inadequate in digitizing in ways that go beyond email-based issue management.
Many organizations even continue to rely solely on anecdotal information based only on personal relationships. The lack of a robust digital strategy makes it easier to lose essential business intelligence with moving personnel within and outside the organization.
The new digital community platforms go beyond traditional business intelligence and drive meaningful operational efficiency through the combination of data and human interactions.
The McKinsey report adds: "A digitized supply chain strengthens capabilities in anticipating risk, achieving greater visibility and coordination across the supply chain, and managing issues that arise from growing product complexity."
Visibility, collaboration, agility, and reliable digital platforms will determine how organizations and their supplier ecosystems will fare in the aftermath of the current crisis.
Ultimately, the coronavirus crisis is more than a test to an organization's supply chain resilience. It is perhaps its most exceptional opportunity to gain new capabilities and come out stronger than ever before.
We do not yet know what the shape of this recession will be and what the economic recovery will look like in the months to come.
But what we do know is waiting for things to go back to normal to act will not be the best course to action.
Because there's a new normal awaiting on the horizon.
Streamliner helps you take control over your inbound supply chain.
Learn more and contact us firstname.lastname@example.org