Despite your best efforts, disruptions can and do occur in supply chains. You might not be able to completely eliminate the possibility of disruptions, but one thing you can do is make sure your firm is able to bounce back quickly when they do strike. The digitization of supply chains, however, is throwing a wrench into these plans and forcing businesses to seek new approaches to boosting resilience.
By enlisting the help of big data to find supply chain risks, early warning systems can be set up ti alert managers of problems right away. However, firms also need to be able to respond to such warnings rapidly, and this is where a lot of companies run into problems.
According to a survey of 30 international companies that was carried out by the Center for Global Enterprise, 88 percent of respondents have added digital supply chain elements to their business models. All of the respondents said they were actively working toward taking on game changers like the Internet of Things and robotics.
Automatically Addressing Problems
The next step is automating resiliency. While setting up safety stocks, arranging spare transportation capacity, and diversifying the supplier base are all helpful steps, creating resilient digital supply chains is also incredibly important, and smart software and automation are needed to help them respond quickly. Upon detecting potential disruptions, such systems are capable of determining the best mitigation strategy and then carrying it out.
Take the example of a loaded freight container with sensors that keep track of the humidity and temperature of goods at all times. If an equipment malfunction causes damage to perishable cargo, for example, the system will detect it and automatically place an order for replacements right away. In fact, it is precisely in these types of supply chains where automating resiliency is most useful as risk-prone supply chains tend to be audited and inspected more often.
This blog post was based off of an article from UPS Longitudes. View the original here.