Using Consumer Usage to Evaluate Your Resilient Supply Chain

Resilient supply chain is the ability of a supply chain to remain flexible despite sudden unexpected risk factors. Resiliency in a supply chain is a direct result of the design and operation of a robust and effective supply chain. If you possess a resiliency in a supply chain, then you are able to recover and react quickly to these unexpected events by moving on to the safer or more desirable position in order to enhance customer service, higher market share… The resiliency of a supply chain allows it to adapt to unanticipated events. If you are planning to build a strong and resiliency supply chain, then you should pay attention to all of the following characteristics:

– Visibility and Awareness. In a robust and resiliency supply chain, the entire logistics processes are visible to all those components that play a role in the execution of the whole process. This is made possible through the full visibility of inventory control, asset management, pricing, asset availability, inventory balance and other pertinent logistics processes.

– Action Based Learning. Most companies and businesses fail to apply their lessons learned in supply chain management to their operations and, as a result, face significant risks and repercussions. On the one hand, there are opportunities and threats in every supply chain; therefore, if you want to preserve and strengthen your resilient supply chain, then you need to regularly assess and review the current status of your operations and your key areas of concern.

– Identify the Targeted Action. When a business undergoes a disruption, it usually means that it experiences a significant change in the status of its operations. Some businesses experience significant interruptions on a daily basis such as interruptions caused by outages or temporary power outages, while others experience interruptions due to weather conditions, natural disasters or even brief technical glitches. A resilient supply chain focuses on identifying the right actions that can be taken in response to a disruption in order to prevent or minimize the impact of the disruption on the business. For example, if you are operating a restaurant in a storm-prone area, then you may choose to close your restaurant temporarily or may decide to put out lunch for customers affected by the storm to protect them from weather-related inconveniences. Similarly, if you are conducting an oil rig, then you will need to shut down the rig until the storm passes or until the threat of oil spill subsides.

– Assess the Risks Associated With the Threat. When assessing the risks associated with a disruption in your supply chain, one of the most important things to consider is the impact that the potential interruption will have on your customer base. For example, if you are a small manufacturing unit, then the disruption might affect a few employees who will be on vacation, but the impact to your customers and business operations might be enormous as your entire production staff might be on vacation and the remaining employees would be unable to function properly. You therefore need to assess the impact of the potential interruptions on each individual workgroup, on the whole, in order to determine the costs involved, which can vary greatly depending on the nature of the particular risks. For example, some risks associated with a storm may involve damage to property and loss of life, so you will need to consider these risks when determining the costs associated with disruption.

– Develop a Recovery Plan. It is very important to develop a recovery plan as soon as possible after a severe disruption such as a storm or a failure at a facility such as a power plant or refinery. A robust recovery plan will enable your company to recover quickly and restore normal operations. In addition, a robust supply chain resilience program will help your company to reduce the number of interruptions to its supply chain.

– Maintain vigilance. In addition to monitoring for signs of a potential disruption in the supply chain, monitoring your company’s efforts will also be crucial as part of your effort to strengthen your Resilient Supply Chain. As part of your plan for 2021, it will be important to monitor your progress and setbacks, as well as to use outside sources to track and report on progress that has been made. Monitoring will help you evaluate whether your actions are being effective in terms of preventing a disruption in the supply chain and your ability to respond quickly and effectively if such a disruption were to occur.

One of the other keys to the strength of a resilient supply chain is to understand customer demand driven MRP. In the past, companies have relied largely on internal resources and in-house resources to meet the demands of their customers. As a result, they have often had to make do with less than ideal levels of service and product, as well as an inability to meet spikes in demand caused by seasonal weather conditions. However, by leveraging the power of the internet and tapping into sources of outsourced information, businesses can more effectively and efficiently meet the needs of their customers and ensure that they are meeting their delivery schedules.