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Managing Supply Chain Disruption in the Midst of Trade Wars

Posted by Martin Verwijmeren on Jun 19, 2018 10:00:00 AM

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The prospect of the two leading global economies, the United States and China, pushing beyond the trading of punitive tariffs and into a full-scale trade war is creating a lot of uncertainty. The potential fall out for organizations engaged in global trade could be disastrous. But the desire for managing supply chain disruption, reducing risk, and protecting future profits also creates the drive for improvement that will lead forward-thinking businesses to pursue real-time visibility and control over their supply chains. By adopting supply chain orchestration (SCO) global organizations may be able to reduce some of the uncertainties that comes with these tariffs.

Visibility Is Vital

It stands to reason that you can’t control your costs if you don’t fully understand them in minute detail. Organizations must have insight into every step of every order in their supply chain to make smart decisions, yet in a 2016 study by Gatepoint Research, “Trends in Supply Chain Visibility,”  just 19% of them claimed end-to-end supply chain visibility.

When a tariff change comes out of the blue, speedy adjustments must be made to lessen the potential blow. It’s important to maintain agility and avoid getting trapped in agreements with specific vendors or becoming dependent on certain suppliers and routes. You must remain flexible and be able to change without penalty to prevent costs from spiraling out of control.

With insight into the precise costs of each course of action you can make informed decisions, but visibility isn’t enough on its own, you also need mechanisms in place to be able to make those decisions a reality.

Real-time Control is Crucial

The big picture view across your entire supply chain, including third-parties, warehouses, and all the disparate software systems in play helps you see where changes are required, but you also need the power to make them rapidly. You may need to find new services or sources in a hurry to keep costs under control and you’ll need SCO to do it.

Not only does SCO establish real-time insight into your supply chain, it also empowers you to optimize it fully. All the various external services and partners that make up your order lifecycles can be controlled as though they were internal components. By assessing results over days, weeks, months, and years you can begin managing supply chain disruption by proactively solving problems and honing your end-to-end performance until it’s running like a well-tuned engine.

Differentiate your Business

Consider that 79% of organizations with superior supply chain capabilities achieve revenue growth that is significantly above average, according to Deloitte. SCO enables a new level of operational excellence, so you can reach higher standards of customer service without spending too much.

It’s about giving you the power to balance service and cost while maintaining business agility.

By extending your knowledge and oversight beyond internal systems to your suppliers and their suppliers, you can start to accurately anticipate potential issues and dramatically reduce the threat of change that something like a trade war represents. Start new relationships, build your options, and keep a watchful eye on the horizon.

SCO can not only help you mitigate various risks by effectively managing supply chain disruption, but it also enables you to quickly adopt fresh strategies to outperform your competitors.

 Supply Chain Visibility White Paper

Topics: Supply Chain Visibility, Control Tower, Supply Chain Optimization, Supply Chain Management, Disruption





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