Meanwhile, the risk of long lead times and sustainability issues are receiving increased focus. However, the world is becoming more expensive, as well as more conscious of environmental and ethical considerations, on one hand, while robotics are reducing the labour cost differential of near-shoring on the other. It led to a rapid refocusing of manufacturing and sourcing, and therefore supply chains, to China and other parts of Asia.
#Define antidote driver#
Holistic strategic change encompassing networks, people, processes and systems takes time.Ĭost was once the major driver in offshoring. This leaves us managing more complex networks without the right tools for the job at hand and many networks are now counting the cost. But supply chain processes and systems cannot always be overhauled that fast. We have seen instances where supply chains reconfigure quickly, for example when manufacturers in the US rapidly near shored some production elements to the likes of Mexico as a result of the trade war. It is worth remembering that supply chain transformation is normally slow to achieve. How then, should businesses be calibrating their networks to combat these issues? Decision-making in the supply chain The ongoing challenges of trade tensions with China and the result of the election, and its potential aftermath, are very much front of mind.Įlsewhere in the world, there has been conflict in central Asia and protests in Thailand and Nigeria, while coming up is Brexit and the end of the UK’s transition period out of the EU – the list goes on. But they are also looking to hedge their bets against inevitable future turmoil, which we know is on the horizon, but is difficult (or impossible) to predict the impact of. This is partly due to the ongoing pandemic disruption. Right now, many businesses are reviewing their supply chains and considering factors such as operational strategy, resilience, agility or perhaps even the possibility of onshoring. Mitigating the impact of political turmoil Instead, they need long-term agility and resilience. In a high risk world, supply chains cannot simply rely on inventory and capacity as insurance though, because it is simply too expensive. This is largely because risk needs to be offset with expensive insurance, such as increased inventory or capacity.
A lack of resilience increases risk and, ultimately, supply chains are like stock markets – they hate risk and uncertainty. Many efficiency targets are siloed metrics and this, combined with continued global disruption, raises the question of whether the incessant pursuit of efficiency has led to less resilient networks. Increasingly, companies are re-examining the trade-offs between efficiency and risk, resilience and agility.
Mitigating the impact of political turmoil will be high on the agenda for many Supply Chain executives right now. Combining short-term reflexes with strategic decision-making, all informed by the same accurate, trusted data-driven planning and forecasting is crucial.Īchieving optimum levels of efficiency within supply chains is a common objective for organizations across the globe.
0 kommentar(er)
