The supply chain environment is more uncertain than ever with an increasing level of shocks including geopolitical events, labour strikes and political instability. Businesses can’t control the wider supply chain environment, however, they can control how they use contingency planning to strengthen their supply chain operations and processes.
The new age of the supply chain is driven by data so that quick and informed decision-making can take place enabling businesses to pivot swiftly as circumstances dictate. Data is a gift to organisations in this era of disruption and making the most of it is key. Siloed data prevents the required visibility from being achieved and hinders the seamless flow of data to be processed into actionable information
Today’s supply chain environment
From conflicts in the Middle East to weather disruptions, the supply chain faces multiple headwinds on multiple fronts. While supply chains do recover and rebound from shocks, that process can take time and have a profound impact on organisations. McKinsey says that six key trends are reshaping the landscape in 2024 including economic volatility and ESG considerations. Economic volatility, in particular, has been a key trend this year, from commodities to crucial ingredients, inflation has squeezed the margins for many businesses.
Customers still expect to receive what they have ordered even amidst turbulent times and businesses need to let nothing get in the way of that. The pandemic revealed how vulnerable supply chains can be and why that fragility needs to be taken into account in supply chain management and operations, to be prepared for every eventuality.
The importance of contingency planning
It couldn’t be more important in an era of uncertainty for businesses that they are ready to move quickly in the event of supplier failures or emergencies taking place. Contingency planning involves numerous elements including implementing buffer stocks, securing backup suppliers, or having alternative logistics routes, to eliminate potential downtime. Contingency planning starts with a risk assessment to understand the possible events which could have an impact. Safety stocks are also a vital part of contingency planning as shortages in the supply chain can be mitigated.
When it comes to complex supply chains, the right solution can assign a risk score to suppliers and risk mapping can take place dynamically in real time. Risks can emerge throughout the supplier lifecycle whether that’s legal, political, economic or environmental. Software can amalgamate data from multiple sources and as a result, help to predict and manage risk. Supplier Relationship Management takes risk into account while holistically managing supplier selection, onboarding, performance, and engagement.
Strengthened supply chains
Synertrade’s Accelerate S2P platform bolsters the effectiveness of risk management efforts, enabling organisations to increase supply chain resiliency. Our solutions provide real-time data insights and predictive analytics, combining data from several 3rd party providers into one single source of truth. This enables businesses to make better-informed decisions and mitigate risks ahead of time, minimising any potential disruptions.
Using a database, suppliers can be compared and evaluated against others to easily determine which ones meet the bespoke individual needs of the business. This capability enhances contingency planning by ensuring businesses can continue to operate with minimal disruption even when emergencies arise.
Artificial intelligence offers organisations the ability to be able to make better predictions about what could happen in the future and to make the most of the data that they have now. Here at Synertrade, we’re busy preparing for the launch of the latest version of Synertrade Accelerate next year where AI will take centre stage and take procurement operations to the next level, stay tuned as we share more details on what’s to come in 2025.