It’s impossible to see the future or know exactly if or when disaster will strike. It is possible to equip your supply chain with the necessary tools that will allow your business to carry on as usual in the face of disruptions. The key to such a resilient supply chain is ensuring its fluidity and ability to adapt when something happens that was not planned. A resilient supply chain is a strong supply chain, and strong supply chains rely on more than good logistical management and an advanced ERP system. To create a resilient supply chain, an enterprise can choose to utilize redundancies, flexibility and collaboration.
Resilient Supply Chains Key 1: Redundancy
By creating redundancies, such as extra inventory, maintaining low capacity utilization and employing multiple suppliers, the enterprise is less likely to have a stop in production and fall behind. It is important to acknowledge that a redundant supply chain goes against the principles of a lean manufacturing system, and it comes with a pretty large price tag. It can also lead to a decrease in quality of product due to high levels of inventory and mass production. However, the ROI of a redundant supply chain is significant should a crisis arise.
Resilient Supply Chain Key 2: Flexibility
Rather than being redundant to be resilient against disruptions, a supply chain can opt for practices that will make it flexible. This will help it stay strong in the event of a disruption. The supply chain will also respond better to demand fluctuations. A flexible supply chain has standardized processes that use interchangeable and generic parts and products and has cross-trained employees. Another key component is running these processes concurrently rather than sequentially. These practices allow a supply chain to reallocate its resources to ensure that production can continue should something happen that would render a step in the supply chain inoperative.
Resilient Supply Chain Key 3: Collaboration
Much like a flexible supply chain, a collaborative supply chain makes it resilient should a disruption arise because it ensures transparency across the enterprise, allowing it to shift production as needed. Here at Dolven, we use an impressive ERP system that allows us to collaborate with both of our strategically placed sources. At all times, we know exactly what we have available and where which allows for better response times and less production time loss. If one of our sources were to experience a disruption, we know our other source is available to step up and supply product just as easily.
Any one of these practices will strengthen a supply chain and make it resilient, and a resilient supply chain is a competitive one that can be trusted and relied upon by its customers.