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Ensuring a robust Supply Chain – Part 1

By Sherna Jay
In Procurement Technology
Sep 8th, 2015
0 Comments
2997 Views

As organizations strive to maintain a robust & secure supply chain, the impact of supply chain disruption on procurement can vary widely. From a recent survey of 525 respondents across 71 countries:

  • 81% of respondents experienced at least one incident of disruption
  • 35% stated damage to brand reputation
  • 59% experienced a loss of productivity post disruption

How healthy is your organization when visibility and resilience is in picture? Let’s have a look at how we can ensure a robust supply chain to combat disruption:

1.Set up BCP/SCRM

Have a business continuity plan (BCP), coupled with the best practices of supply chain risk management (SCRM) at your organization. Having these in plans ensures that all the different types of risks/losses are assessed, probability is estimated and recovery strategy is ready.

2. Multiple suppliers or supplier networks

One of the easiest ways to reduce risks is by building a robust, reliable and transparent supplier base. This eliminates high dependence on a single supplier whilst increasing focus on compliance. Having supplier networks allows companies to have a quicker turnaround during a disruption.

3.Establish a warning system

Putting leading risk indicators like process instability, management changes, litigation issues, price increase requests etc. in place is essential. Often a combination of financial, commercial and operational metrics are used to determine the risk tolerance levels.

4.Creating an agile supply chain

Agility is more than just performance. Build additional inventory and increase capacity keeping in mind extreme conditions. Though this step carries a cost, it reduces the potential impact in terms of loss of sales, recovery and reputational damage.

5. Collaborate

At the time of disruption, often a decision taken by one business unit can have a major impact on the entire organizational supply chain. As a mandate, collaboration across inter-departments is a must.

In our next post, we discuss how technology plays an essential role in ensuring a robust supply chain.

What steps do you ensure for a robust supply chain? Share your views in comments below.

In our whitepaper, Supply Chain Resilience in the face of disruption, we discuss how the Thailand political crisis had an impact on trade in Germany & how organizations can seal their supply chain to be more robust in the need of the hour.

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About "" Has 30 Posts

Sherna is a Senior Marketing & Communications Executive at Zycus. An avid blogger, a maniac editor and an animated colleague; you'll find her tweeting and visualizing new Pizza Treats when she's free.

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