How a new supply chain tool enables resilience for a more productive future
After an incredibly difficult year, the supply chain industry is hard at work rebuilding better and stronger than before. As our global community looks to the future, it’s clear that all supply chains have a unique and important opportunity to learn from both the shocks of 2020 and how the most resilient organisations faced a myriad of challenges.
To that end, the Association for Supply Chain Management (ASCM) has commissioned The Resilient Supply Chain Benchmark research report from The Economist Intelligence Unit (EIU). The report assesses modern supply chain resilience-building capabilities by evaluating the supply chains of 308 publicly listed retail, pharmaceutical and consumer electronics companies. The result is a rare insight into both operational and strategic supply chain resilience that enables companies to identify and respond to both sudden shocks and longer-term structural shifts.
The research confirms that one essential objective for tomorrow’s supply chains will be a keen focus on ecological stewardship, social responsibility and economic sustainability. There is simply no doubt that all companies have an opportunity to make an impact by decarbonising their global supply chains. However, less than half have set targets to reduce supply chain-related carbon emissions. Plus, after setting targets comes the considerably more difficult endeavour of reducing emissions across complex networks with numerous suppliers.
A second focus area for the supply chains of the future will be visibility. Unfortunately, the research finds that more than half of companies surveyed lack end-to-end visibility into their supply chains because they rely on a picture of supply and demand that is based on only internal data. In addition, 37 per cent of those surveyed reported that their visibility is hampered by either internal siloes or is not data-driven. This leaves these businesses vulnerable to unexpected risk and limits their ability to detect emerging threats.
Thirdly, the research concludes that business continuity plans and playbooks should incorporate triggers outlining actions to be taken across a range of disruptions. Overall, only 57 per cent of respondents say they have business continuity plans that meet this criterion, a number that is shockingly high given today’s complex and dynamic threat matrix. During such a prolonged crisis, processes that may not seem essential have blindsided critical processes when they fail.
For all three of these supply chain targets – and countless others – multi-stakeholder collaboration is key to getting us where we need to be. As the accompanying ASCM/EIU whitepaper states, supply chains must collaborate beyond one’s own network in order to become truly sustainable. Furthermore, time and again the high performers are those organisations that work together with their supply chain partners by sharing best practices, joint long-term planning and providing financial assistance to preserve supply chain networks. In fact, 55 per cent of companies benchmarked say they directly help suppliers remain solvent during times of crisis.
The second phase of ASCM’s collaboration with the EIU is a benchmarking framework that identifies best practices in both real time and strategic supply chain resilience. The Resilient Supply Chain Benchmark interactive tool will enable supply chain leaders everywhere to discover essential supply chain lessons from industry peers and be much better equipped for a resilient future.
by Abe Eshkenazi, CEO, ASCM