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Protecting Your Business from Supply Chain Disruptions During Emergencies

6 March, 2020
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From natural disasters to medical emergencies like the novel coronavirus currently making its way around the world, unpredictable events can cause disruption in your business. This means, for many organizations, supply chains can take a hard hit – as many enterprises depend on international suppliers to deliver parts and products. With China being the center of the coronavirus outbreak, many businesses are facing the decision to rethink their supply chain strategies and options for acquiring and transporting goods – especially if they do not already have previously established contingency guidelines in effect.

Lack of preparation for emergencies or crises can completely halt a supply chain, causing detrimental loss of business, among other serious consequences. In the wake of the coronavirus, companies may experience challenges:

  • Supply shortages in the impacted areas
  • Lack of workers due to employee illness or quarantine guidelines
  • Restricted travel with limitations on discovering/transacting new business
  • Limited capacity and availability at supply hubs
  • Loss of customers who may be disinterested in purchasing products from affected areas

From automotive to IT and many other industries, emergencies or crises demand strategic thinking about supply chain operations, and several vital elements are essential to remember and integrate into any business plan.

 

Immediate Tactics

Immediate response items include developing a program that monitors supply chain disruption in impacted countries, as well as ensuring that all inventory is reachable and not located in the area with the outbreak. Additionally, it’s critical to assess how customer spending may be affected, including any financial implications that may arise as a result of being unable to deliver supply. Maintaining a clear and consistent line of communication with suppliers – continuously monitoring situations and adjusting correspondingly – is the foundational element that businesses must put into effect, in order to find a resolution to issues with supply chain disruption during a scenario such as the coronavirus outbreak.

 

Future Plans

If businesses don’t already have plans in place on how to deal with emergencies that may interrupt supply chain operations, it’s necessary to begin devising a strategy. Here are some proactive measures to take in developing a plan for preventing future supply chain issues, in case of an emergency.

 

Stay Agile

Having the right people, processes and tools in place is critical to mitigate risks in the supply chain and stay nimble. Some of the fundamental characteristics of an “agile supply chain” include responsiveness, competency, flexibility and quickness, with a strong focus on using real-time data and updated information to improve overall efficiency and productivity, as reported by Martin Christopher in Industrial Marketing Magazine.

One example of an agile technology solution is using a centralized system to consolidate and align operations with visibility into the status of each supplier’s shipments, throughout the entire supply chain. Purchase order management, as well as systems that enable product tracking, allows insight into what is happening throughout the supply chain and provides real-time opportunities for making quick shifts and changes in orders. For example, if a shipment of laptops experiences a delay on the way to its destination, this type of system can quickly display and inform about where similar products are located, allowing for procurement to make alternative arrangements.

 

Identify Alternative Supply Chain Resources

While we often don’t like to consider the what-ifs, unexpected events can interrupt daily routines and business processes, forcing organizations to consider different approaches. In the case of a medical crisis like coronavirus affecting supply chains, it can illuminate potential vulnerabilities related to having suppliers in one geographical area and possibly far away from critical markets in North America, Latin America and Europe. This means many businesses will be forced to rethink their supply chains and adapt to global trade policies that may change at a moment’s notice.

Additionally, it’s essential to have a backup for supply, production and distribution outages. While having a massive stock of merchandise ensures a business won’t run short on supplies, changes in the economy, as well as consumer buying patterns, may fluctuate based on the severity of the situation; this could potentially lead to revenue loss if inventory is no longer wanted. Incorporating local sourcing into a new supply chain strategy is also a pivotal point to consider. Asking companies to have production facilities with local sources of supply in each of its major markets helps evenly distribute the risk across multiple locations while cutting back on transportation costs. 

 

Create Business Continuity Plans

Securing the supply chain for the future means companies need to focus on several areas. With technologies like artificial intelligence (AI), blockchain and machine learning, companies now have the capability to create self-driving, automated supply chains. Automation can help reduce or completely stop disastrous supply shortages and delays.

Implementing a digital strategy throughout the entire supply chain is key to ensuring business continues to thrive in the future, if and when another unexpected scenario occurs again. The supply chain of the future should include a robust, agile and sustainable manufacturing ecosystem that is digitally enabled from the beginning of product ideation and development, extending all the way to end of life. Deep visibility into the complex data that stems from a digitally enabled supply chain allows effective decision-making.

Unexpected events like coronavirus can leave businesses and their supply chains reeling, if unprepared. At Dynamic Computer Corporation, we maintain a strong and reliable supply chain, delivering transparency in our process, communicating with customers about alternative solutions and proactively adjusting to changing circumstances.

Contact us at 866-399-1084 or info@dccit.com to discuss our manufacturing and supply chain technology solutions.

Tami Schultz

Tami Schultz is the Vice President of Business Development at Dynamic Computer Corporation, where she leads the sales and account management functions with her expertise in developing and executing strategy. As a service outsourcing veteran, Tami has a proven track record in leading complex national and global service programs that leverage technology to enable business objectives while growing market share. She is also a member of Michigan Women in Technology and the Supply Chain Leaders in Action – Women in Action Committee.

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