Early Warning System: Does your Supply Chain Need One?
Is an early warning system (EWS) on your wish list for 2025? A recent article from the Harvard Business Review makes the case that it should be.
Authored by partners at McKinsey & Company, the article states that: “Like an emergency light in a car, a well-designed EWS can alert companies to small problems before they become big ones.”
The article lists the folllowing three key components as essential for an EWS:
• An integrated and centralized data-storage system. Data management has become increasingly important to supply chains. As MHI CEO John Paxton recently wrote in a recent MHI Solutions article, there is a “growing need for transparent, data‑driven supply chains. This is no easy task, and you can’t get there without a commitment to data integrity.”
• The use of AI to establish actionable alarms. This process relies on using AI to quickly spot anamolies.
• An updated risk-management playbook that empowers your organization to quickly respond to alarms.
With rising geopolitical conflicts that make it difficult for countries to source product from certain regions and the possibility of new tariffs in 2025, an EWS can provide businesses with the agility to anticipate risks and respond proactively. By turning uncertainty into actionable insights, companies can position themselves to protect operations, maintain supply chain stability, and gain a competitive edge in a rapidly shifting landscape.
Looking for more strategies to build your supply chain resiliency? Check out our most-read MHI Solutions articles from 2024.
