Is your supply chain prepared for disruptions?
by Sterling J. Scott, Marketing Communications Coordinator, MHI | @mhi_sterling
With supply chains globalized and interconnected now more than ever, the risk of disruption is higher than ever before. Any disruptions to material sourcing, labor, transportation, and consumption can have an immediate and devastating impact on a company’s supply chain. These disruptions can be caused by weather / natural disasters – hurricanes & tsunamis, conflict – civil unrest, terrorism, & warfare, economic issues – recession, policy changes – embargoes & tariffs, labor issues – strikes, and health issues – ebola.
Many of these disruptions can’t be forecasted as they come without warning and require ongoing planning to mitigate risk. Here are a few key strategies and considerations businesses must take to secure their supply chains and limit the impact of disruptions.
Alternate Source of Raw Materials & Labor
Companies should have alternate sources so that disruptions to materials and labor have minimal impact on production. It’s also important to have a real-time view of your supply chain so that you know when to turn to alternate sources.
Alternate Methods & Routes of Transportation
Your supply chain should develop alternate transportation plans to avoid delays in production or delivery that can result from disruptions. There should be a contingency plan in place to prepare for a spike in energy costs, key points on transportation routes becoming conflict zones, and natural disasters.
Monitor Political, Economic, & Social Conditions in Regions Affecting Supply Chain
It is important to have situational awareness and know the imminent and long-term threats that may impact your business. Companies should engage in ongoing analysis and reporting to maintain a realtime view of the political, economic, and social environments that may impact their operations.
These are just a few of many ways your company can prepare for disruptions. You should connect with the top providers of supply chain products and solutions at MHI to learn more. Register for ProMat 2015, the largest expo for manufacturing and supply chain professionals in North America, to connect with these companies and visit www.MHI.org to gain access to key reports and white papers.