Supply Chain Resilience: Why It Matters and Tips on How to Achieve It

Supply-chain disruptions cost the average organization 45 percent of one year's profits over the course of a decade, according to a December 8, 2021 Podcast / Article by McKinsey & Company, Supply-chain resilience: Is there a holy grail? In today's increasingly global and interconnected economy, the term "supply chain resilience" refers to a company's ability to maintain its operations despite disruptions in its supply chain. This can be due to a variety of factors, ranging from a pandemic to natural disasters. While a certain amount of disruption is inevitable, companies need to have a strategy in place for dealing with unexpected events. This includes having a reliable workforce, adequate inventory levels on hand, and being able to quickly identify and respond to warning signals that a crisis is brewing. By taking these steps, companies can ensure that their supply chain remains resilient in the face of unforeseen challenges.

There is no one-size-fits-all answer, as the best way to maintain supply-chain resilience will vary depending on the specific industry and company. However, there are some general tips for supply chain managers and warehouse operators to help improve their supply chain’s resilience in the face of disruptions.

First, it is essential the operations team has a clear understanding of its supply chain and its potential vulnerabilities. This includes identifying which parts are most critical to the company's operations and what could happen if those parts were disrupted. Once these vulnerabilities have been identified, it is important leadership puts in place strategies and processes to mitigate the risks.

One way to improve supply-chain resilience is to build strong relationships with suppliers especially suppliers crucial to operational success. These relationships should be based on trust and understanding of each other's needs and goals. Good communication is also crucial in maintaining these relationships. In the event of a disruption, companies that have strong relationships with their suppliers and workforce solution partners are more likely to be able to work together to find solutions. ?

It is also important to have diversified suppliers. This means having multiple suppliers for each critical component of the supply chain. This reduces the risk of disruptions, as a company can source its components from different suppliers if one supplier cannot meet its needs. ?Diversifying suppliers also provide competition, which can help to keep prices down. Having multiple suppliers also allows a company to compare prices and quality and choose the best supplier for its needs.

Another way to improve resilience is to build up stocks of critical components. This can provide a buffer in the event of a disruption, as the company will still have the components it needs to continue operations. Additionally, companies can work closely with suppliers to create contingency plans in case of supply disruptions. These plans may include alternative sources of supplies or new methods of manufacturing.

Finally, a contingency labor solution should be an important part of a company's operation plan to prepare for any potential crisis. This type of workforce solution provides a way to maintain productivity and steady the operation.

How will your warehouse operation address the next disruption? Will you be able to maintain stability and keep it on track??

#SupplyChain #WarehouseOperations #SupplyChainResilience #HardWorkDoneRight