How to Achieve an Agile and Resilient Supply Chain in the New Year

Businesses can overcome obstacles and build more agile and resilient supply chains with a few key actions.

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Agility and resiliency have always been a crucial part of operating an effective supply chain. Product demand fluctuations are just one of the things businesses have had to consider. They recognize the need to rapidly adapt to changes and bounce back from disruptions. This became especially apparent in the advent of the Coronavirus disease (COVID-19) pandemic, which ushered in an era of social distancing and shifts in shopping patterns, specifically how and where things are purchased. According to a report by McKinsey, e-commerce now represents as much as 15% of total grocery spend. Supply chains have had to work quickly to keep up, and that’s why it is so important for them to remain agile and resilient at all times. 

Businesses have continued to strive for efficiency but may have unintentionally overoptimized in the process. Relying on just-in-time manufacturing and the belief that they can cut and reduce at will, their efforts may have yielded outstanding results before the pandemic. That, however, may not be the case in this new and evolving environment. With supply chains stretching across the world, it can be difficult to manage them. International events, whether in the form of a pandemic or some other unimaginable occurrence, may then lead to additional challenges that highlight the lack of visibility into the inner workings of a global supply chain. This may sound overwhelming, but businesses needn’t fear – they can overcome these obstacles and build more agile and resilient supply chains with a few key actions.

Align the organization with supply chain functions throughout the network

By ensuring that systems, processes and communications are in alignment with one another, businesses can build a more agile and resilient network. This is more important than some firms may realize, encompassing functions of both the supply chain and the business itself. As a result, every organization within the network will better understand the impact of their own individual decisions.

Unite partners and guide them to achieve optimal success

In any climate, businesses are tasked with leading the distribution of goods and information across their networks while enduring and ultimately overcoming possible disruptions. This can be difficult in situations where partners appear to be competitors, but they need to work together to achieve optimum results.

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Focus on process and structural agility

Process agility (empowering people to make rapid decisions) and structural agility (the ability of the network to flex rapidly in the event of a disruption) are essential to the success of a supply chain. The former can only be accomplished with the right data at the right place and time in order to generate the necessary alerts and insights. The latter is beneficial by drawing upon insights from multiple data sources. In doing so, organizations will be equipped to respond to these events with greater efficiency and success.

Ensure it all works well together with orchestration

Orchestration is the final piece of this important puzzle. Businesses should combine alignment, flow and agility to improve coordination throughout and across the whole network. Once a course of action is decided, it may even be possible to achieve near real-time results.

Be prepared to adapt no matter what

The COVID-19 pandemic has served as a strong reminder that organizations need to be prepared for anything. They must be agile enough to quickly pivot as events transpire and resilient enough to withstand any and all potential challenges that may develop. By focusing on agility and resiliency, businesses can simultaneously thrive with supply chains that stand apart from those that are unable to do the same. Most importantly, this strategy will allow organizations to combat unplanned events with swift and effective action that ensures that operations remain consistent no matter what.