No supply chain is immune to outages or other issues that can affect scheduling, so companies should be sure to use logistics software that allows them to adapt and adjust to delays as quickly as possible, CSO's Derek Slater wrote.
CSO reported that the key to successfully managing the supply chain is for companies to not only have the ability to quickly shift strategies, as enterprises also need to have data gathering methods in place that allow executives to have oversight on all involved variables at any moment.
Natural disasters and adaptable supply chain management
The best supply chain software solution allows a business to always see what is going on at all points, and to make fast decisions based on the situation presented. Slater cited the 2010 eruption of the Eyjafjallajokull volcano in Iceland as a prime example. In the event's aftermath, airplanes were barred from flying over Europe. Companies that rely on air shipments were thrown for a loop, but organizations that had built the greatest amount of flexibility into their supply chain management solutions were able to adapt by diverting shipments to rail and truck.
"The companies that responded fastest secured the excess [alternative] transportation capacity - by rail, for example - that was available," Scott Byrnes, global trading software professional, told CSO. "So the leaders locked those channels down pretty quickly and shut everybody else out."
Another example of the benefits of added supply chain flexibility can be found by looking at what happened in the wake of the 2011 Japanese tsunami disaster. Supply and Demand Chain Executive wrote that while many businesses may have thought that the natural disaster would only affect organizations with operations in Japan, the event turned out to have a far wider effect on supply chains. As a result, those firms that were able to use supply chain software to apprehend the scope of the disruption and react quickly ended up with the smallest financial fallout.
"Think of the flooding in Thailand, the volcano in Iceland and the tsunami in Japan," Byrnes said to CSO. "Those three things shut down a lot of people's supply chains." He added that a "disaster in what might formerly be considered a remote part of the world now impacts everybody."