Even if your company is prepared for all types of supply chain disruptions that can occur, it is nearly impossible to know when they will happen. Furthermore, the supply chain is more fragile than it seems. As Wards Auto's white paper "Supply Chain Management: What You Don't See Can Hurt You" explains, very indirect interruptions can wreak havoc on the supply chain.
For example, a recent report by Nature journal said that a fungus which rots and kills the main variety of export bananas has been found in Asia and Australia. Concerns are rising that if the fungus turns up in Latin America, which accounts for 80 percent of banana exports, it could decimate the farming of the Cavendish variety bananas - the most popular.
While this is bad news for direct sellers of the bananas, it could also threaten nearly every company in the food supply chain that uses Cavendish bananas. As soon as such information is available, food supply chain managers should begin considering alternative suppliers, methods or products that can be used instead.
Three Steps to Prepare for a Supply Chain Interruption
Wards Auto recommends a few steps that supply chain managers can take to prepare for unexpected interruptions:
- Anticipate: If possible, don't put all your eggs in one basket. Reach out to multiple suppliers so that disruptions to one supply chain don't halt production.
- Flex: Prepare to enter the global supply chain if you haven't already. At some point, overseas suppliers or growth to new markets will require it.
- Sustain: Supply-chain models need to streamline operations by automating processes to keep pace with changing demands.
Technology Can Help Sustain the Supply Chain
To prepare for supply chain disruptions, managers need data to plan from. Automated data collection systems that can integrate with existing ERP systems can assist managers in gaining an understanding of the flow of their supply chain. Even before disruptions take place, managers can determine if any suppliers may pose a threat with consistently late shipments or high rates of damaged goods.
Mobile data collection can help assess back-end operations and determine if third-party logistics providers are disrupting the flow of merchandise to customers with late or damaged shipments. As the supply chain continues to increase in size, speed and global reach, managers must arm themselves with the proper systems to keep up.