Strategies to bolster the Supply Chain
The supply chain includes the strategic and integral process of organizations in the creation of a product, this being comprised of relationships between various entities. The production and profitability of organizations will depend on the level of efficiency of their supply chains. In every sector, the supply chains are the cornerstone of company productivity. However, these have shown to be vulnerable to disruptive events, risking operational continuity.
Published on March, 2022
Eduardo Garza & Daniela Lechuga
The supply chain includes the strategic and integral process of organizations in the creation of a product, this being comprised of relationships between various entities. The production and profitability of organizations will depend on the level of efficiency of their supply chains. Strengthening the relationships and ensuring process continuity will guarantee companies’ sustainability.
Strategies for mitigating and monitoring disruptive events.
1. Planning and internal strategy. Organizations need to reassess their business strategy as a first step towards the strengthening of their supply chains.
1.1. Action Plan Creation. Establish and prepare immediate measures with the purpose of handling potential issues.
1.2. Risk Management. Monitor and manage risks, anticipating disruptive events.
1.3. Attention to Vulnerability. Identify weak points in processes.
2. Investment in technology. The use of digital tools represents quick and efficient communication between all members of the supply chain.
2.1. Digital Network with suppliers, clients, and consumers. Adoption of a digital communication system and in real time.
2.2. Optimization of the Productive Process. Implement technology in all company operations.
2.3. Disruption Preempting Models. Use applications and technological systems able to anticipate any disruptive event.
3. Inventory Management. Maintain an optimal equilibrium between the minimum amount of consumables and the necessary amount needed to carry out the production processes.
3.1. Efficient Inventory Management. Optimization of inventory levels, with the efficient use of consumables.
3.2. Creation of an Emergency Inventory. Create backup inventories.
3.3. Alternative Strategies to “just in time”. Implement strategies that allow a flexible inventory management.
4. New relationship with suppliers. Organizations need to change their relationship with suppliers with the aim of reducing their dependence on them.
4.1. Business with Backup Suppliers. Business with secondary suppliers that can meet operational problems.
4.2. Supplier Portfolio Diversification. Having in place a series of suppliers, reducing the risk of suffering issues from any event.
4.3. Coordinated Strategies. Improve communications with suppliers establishing joint strategies.
5. New relationship with clients and consumers. The volatility and unpredictability of the demand requires new relationships with the members at the end of the chain.
5.1. On Demand Productive Processes. Activities driven by the market demand level.
5.2. Open Channels of Communication. Open, efficient and up-to-date relationships with clients and consumers.
5.3. Flexible Logistics Agreements. Having logistic alternatives that allow the fulfillment of producer and trading companies.
6. New relationship with clients and consumers. The volatility and unpredictability of the demand requires new relationships with the members at the end of the chain.
6.1. On Demand Productive Processes. Activities driven by the market demand level.
6.2. Open Channels of Communication. Open, efficient and up-to-date relationships with clients and consumers.
6.3. Flexible Logistics Agreements. Having logistic alternatives that allow the fulfillment of producer and trading companies.
The growing presence of disruptive events has made the vulnerability of the supply chains visible, as well as the low degree of preparedness of companies. It is necessary to strengthen the chains by implementing monitoring and risk management mechanisms that enable companies to anticipate any possible issue. Also, technology and the creation of new inventory models should optimize operations and productive processes, ensuring continuity under any scenario.
(PDF Article Only Available in Spanish)
Strategies for mitigating and monitoring disruptive events.
1. Planning and internal strategy. Organizations need to reassess their business strategy as a first step towards the strengthening of their supply chains.
1.1. Action Plan Creation. Establish and prepare immediate measures with the purpose of handling potential issues.
1.2. Risk Management. Monitor and manage risks, anticipating disruptive events.
1.3. Attention to Vulnerability. Identify weak points in processes.
2. Investment in technology. The use of digital tools represents quick and efficient communication between all members of the supply chain.
2.1. Digital Network with suppliers, clients, and consumers. Adoption of a digital communication system and in real time.
2.2. Optimization of the Productive Process. Implement technology in all company operations.
2.3. Disruption Preempting Models. Use applications and technological systems able to anticipate any disruptive event.
3. Inventory Management. Maintain an optimal equilibrium between the minimum amount of consumables and the necessary amount needed to carry out the production processes.
3.1. Efficient Inventory Management. Optimization of inventory levels, with the efficient use of consumables.
3.2. Creation of an Emergency Inventory. Create backup inventories.
3.3. Alternative Strategies to “just in time”. Implement strategies that allow a flexible inventory management.
4. New relationship with suppliers. Organizations need to change their relationship with suppliers with the aim of reducing their dependence on them.
4.1. Business with Backup Suppliers. Business with secondary suppliers that can meet operational problems.
4.2. Supplier Portfolio Diversification. Having in place a series of suppliers, reducing the risk of suffering issues from any event.
4.3. Coordinated Strategies. Improve communications with suppliers establishing joint strategies.
5. New relationship with clients and consumers. The volatility and unpredictability of the demand requires new relationships with the members at the end of the chain.
5.1. On Demand Productive Processes. Activities driven by the market demand level.
5.2. Open Channels of Communication. Open, efficient and up-to-date relationships with clients and consumers.
5.3. Flexible Logistics Agreements. Having logistic alternatives that allow the fulfillment of producer and trading companies.
6. New relationship with clients and consumers. The volatility and unpredictability of the demand requires new relationships with the members at the end of the chain.
6.1. On Demand Productive Processes. Activities driven by the market demand level.
6.2. Open Channels of Communication. Open, efficient and up-to-date relationships with clients and consumers.
6.3. Flexible Logistics Agreements. Having logistic alternatives that allow the fulfillment of producer and trading companies.
The growing presence of disruptive events has made the vulnerability of the supply chains visible, as well as the low degree of preparedness of companies. It is necessary to strengthen the chains by implementing monitoring and risk management mechanisms that enable companies to anticipate any possible issue. Also, technology and the creation of new inventory models should optimize operations and productive processes, ensuring continuity under any scenario.
(PDF Article Only Available in Spanish)
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