What can be done to mitigate the risk of supply chain disruption?


In the past two years, the global pandemic, Ever Given Suez Canal blockage and lorry driver shortages have had ripple effects across global supply chains. Container ships have been held-up awaiting permission to dock, there have been backlogs at ports and fleets have been left out of position.

These have been extreme events for the supply chain but disruptions can occur at any time for a variety of reasons including weather events, component shortages and an upsurge in demand. Of course, extended disruption creates the most problems. According to McKinsey, companies can expect supply chain disruptions that last a month or longer every 3.7 years, with the most severe taking a major financial toll.

Shipping is about more than transportation. It is about asset management. Whatever the cause, disruptive events in the supply chain have two things in common. They take a lot of effort to resolve and managing them requires good data.

Companies striving to meet customer demand need robust business continuity strategies that equip them for exception handling. Taking fast action when it is required depends on being able to share up-to-date information at the right time, in the right way.

Proactive delay notifications, for example, help shippers and others adapt to the unexpected by making alternative operational plans. High-quality data requires a common data language and process framework based on shared requirements. With that, communication works for all stakeholders in the supply chain regardless of carrier, technology platform or route.

Global information exchange helps mitigate the risk of supply chain disruption but that takes collaboration. Vendor-agnostic industry standards help smooth the transit of goods through the supply chain through digitised end-to-end documentation and standardised track and trace.

This article is shared by courtesy of FINN PARTNERS

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