The supply chain is the backbone of a thriving retail and manufacturing business. A resilient internal and external supply chain management empowers businesses of all sizes. However, while managing the companies, the leaders must also understand the risks their supply chain may face.
Negligence in foreseeing these events could result in inefficient inventory planning, revenue losses, and operational hurdles. An effective supply chain strategy will enable businesses to thrive without interruptions. Here are a few plans for developing resilient supply chain risk management.
PPRR (Prevention, Preparedness, Response, Recovery) is a strategy used by businesses globally. This strategy aids businesses in taking preventive measures while assisting them in developing a contingency plan in an emergency. It enables them to reduce the attack’s impact and resume operations by running the gears regularly.
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Identifying the suppliers by their potential impact is vital. Businesses must adapt to multi-sourcing with additional vendors at numerous locations. This can be one of the ways to handle environmental risks. However, locating suppliers close to the center of operation reduces cycle times for developing the product and its delivery. Additionally, utilizing a cloud-based architecture reduces the inefficiency due to siloed data and delivers better communication amongst systems.
Digital technologies play a crucial role for many businesses in optimizing supply chain operations, which often exposes companies to threats. Deploying a compliance standard for all third-party vendors and implementing security controls to enhance the authorization level is vital. An overall vendor risk assessment before accepting any contracts is essential.
Understanding the various parts of the supply chain can alert businesses before minor issues become more significant problems. Superlative visibility into the supplier’s financial stability can help select better partners. This will reduce the vulnerability to supply chain risk and develop better business relationships. Service portals and IoT sensors can keep businesses informed and updated in real time while third parties take over the journey.
To ensure the businesses continue at full speed in the event of supply chain disruption, emergency response in the form of a logistics contingency plan is necessary. Identification of the most vulnerable entities and a full assessment of suppliers is the initial step in the logistics contingency plan. Documenting the processes and creating a single source with the development of a stable communication channel will help the employees understand their responsibilities while executing the plan.
Constant monitoring of the supply chain risk factor is primary in protecting the operations. Once the supply chain risk mitigation network is established, each one of the levels of the supply chain framework should be carefully observed for potential risk indicators. Investing in an ascendable digital retail solution for monitoring the supply chain’s numerous aspects will help businesses achieve valuable intel with a streamlined business operation.
Storing data in various discordant systems can derail the management process. Leveraging a comprehensive retail solution that consolidates all the data within a single centralized repository can provide easier access to the documents.
Risk is inevitable. Hence investing in the tools and practices required to identify, analyze, and mitigate risk and to build a supply chain that is resilient, flexible, and strong is the key to standing out with the competing and growing the business into a global entity.
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Apoorva Kasam is a Global News Correspondent with OnDot Media. She has done her master's in Bioinformatics and has 18 months of experience in clinical and preclinical data management. She is a content-writing enthusiast, and this is her first stint writing articles on business technology. She specializes in Blockchain, data governance, and supply chain management. Her ideal and digestible writing style displays the current trends, efficiencies, challenges, and relevant mitigation strategies businesses can look forward to. She is looking forward to exploring more technology insights in-depth.
