How to avoid supply chain disruptions in the future

How to avoid supply chain disruptions in the future

Blog Article

This short article describes several methods to reduce and steer clear of supply chain disruptions. Find more here.

Having a robust supply chain strategy will make companies more resilient to supply-chain disruptions. There are two types of supply management problems: the first has to do with the supplier side, namely supplier selection, supplier relationship, supply planning, transportation and logistics. The next one deals with demand management dilemmas. They are problems regarding product launch, product line management, demand planning, item rates and advertising planning. So, what typical methods can companies use to improve their capability to maintain their operations whenever a major disruption hits? According to a recently available research, two techniques are increasingly appearing to be effective each time a interruption occurs. The first one is known as a flexible supply base, while the second one is called economic supply incentives. Although some on the market would argue that sourcing from a sole supplier cuts expenses, it may cause problems as demand varies or when it comes to a disruption. Hence, counting on numerous companies can offset the risk connected with sole sourcing. Having said that, economic supply incentives work if the buyer provides incentives to induce more manufacturers to enter the marketplace. The buyer could have more freedom this way by moving production among companies, especially in areas where there is a small number of companies.

To avoid taking on costs, various companies consider alternate channels. For example, as a result of long delays at major international ports in a few African states, some companies recommend to shippers to develop new channels in addition to conventional routes. This tactic detects and utilises other lesser-used ports. Rather than depending on a single major port, when the delivery company notice hefty traffic, they redirect items to more efficient ports across the coastline then transport them inland via rail or road. According to maritime experts, this tactic has many benefits not merely in relieving pressure on overwhelmed hubs, but additionally in the financial growth of rising economies. Company leaders like AD Ports Group CEO may likely accept this view.

In supply chain management, interruption in just a route of a given transportation mode can dramatically influence the whole supply chain and, at times, even bring it to a halt. As such, business leaders like P&O Ferries CEO and Maersk CEO work hard to add flexibility within the mode of transport they rely on in a proactive way. As an example, some businesses utilise a versatile logistics strategy that utilises numerous modes of transport. They encourage their logistic partners to mix up their mode of transport to add all modes: vehicles, trains, motorcycles, bicycles, vessels as well as helicopters. Investing in multimodal transport techniques including a mixture of train, road and maritime transport as well as considering different geographical entry points minimises the vulnerabilities and dangers connected with counting on one mode.