Emergencies are an eventual fact of life in the business world. Even the most prepared company can encounter unforeseen circumstances and crises that test its ability to communicate about the issue effectively, fix the problem and maintain a positive perception among customers, employees and other stakeholders. The supply chain is often critical to the success of such efforts, and businesses need to ensure they're ready to respond if a serious issue arises.
Having contingency plans in place, along with a generally efficient supply chain, effective inventory control workflows and other considerations, mitigates potential damage and helps organizations resolve issues quickly and move past them. Here's a review of some suggested strategies and tactics that can help your business successfully address a crisis where your supply chain plays an important role:
A high-performing company with an especially efficient supply chain isn't totally immune to an emergency or major problem. Something unpredictable may crop up due to issues with suppliers of raw materials or retail partners, even if the business itself never causes any issues. Because some events are unpredictable in the specific sense, organizations need to both develop and regularly update general protocols for recalls, disruptions in supply and delivery, the closing or loss of critical partners and other, similar hypothetical situations.
It's difficult to provide specific guidance because of the substantial differences between every company, but there are some valuable general pieces of advice to consider. Businesses should invest time and resources into scenarios that are more likely to happen than those that have a very low probability. Companies should clarify communication requirements and develop chains of contact, both internally and externally. This approach helps develop a coordinated response and avoid issues where the media or regulators have more information at hand during an emergency that the business. Having staff members designated as responders in the event of a crisis, who are regularly updated about response plans and know what their first actions should be after learning of an issue, can also help.
Acceptance of potential problems and planning that includes that possibility ultimately makes responses more effective. Supply Chain Management Review highlighted the prevalence of normal accidents and said planning for them is a necessary step. Instead of attempting to resolve all issues before they happen, resources can be invested into developing effective and fast responses to when normal accidents occur.
Business shouldn't accept frequent, serious incidents as part of regular operations, but they can determine where to draw a line internally and differentiate between the things they have complete control over and the things they don't. SCMR pointed to widespread management practices in the aviation and health care worlds that take normal accidents into account. If these sensitive industries - where the lives of individuals and groups are frequently in the hands of involved staff - plan around the reality of normal accidents, so should supply chain professionals.
As Supply Chain Quarterly pointed out, alliances with suppliers and partners that go beyond the signing of a contract are vital for long-term development. These relationships in general provide a way for both companies to resolve problems, find more opportunities to do business and align relevant goals as needed. In a crisis situation, these relationships can save valuable time in terms of tracking down the root of an issue, determining if a need for a recall exists and providing established lines of communication for nearly any relevant need in a an emergency.
The same idea applies to developing contacts and working together with relevant regulatory agencies and other authorities. It can be more difficult to maintain long-term connections with regulators and government agencies if interactions only occur in the event of a crisis, but occasionally reaching out creates valuable bonds. It also helps businesses learn who to contact and what steps to take immediately after an emergency is recognized.
Companies that invest in the right technology improve regular workflows and can build confidence in terms of addressing the many concerns that arise during a supply chain emergency. A warehouse incorporating automated data collection and electronic data capture isn't just more efficient during day-to-day operations, it can also respond to a crisis quicker than a facility relying on outdated manual processes. Recall efforts involving the warehouse are speedier and more effective, and company leaders have stronger, more accurate data to draw on when devising a response to a concern.
Using powerful inventory management solutions is a practical step that provides a steady return and offers additional benefits when a business has to deal with a major, unforeseen issue.
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