All businesses seek to avoid risks that inevitably come their way. Building resilient and sustainable supply chains is emerging as an important element in corporate risk-mitigation strategies. Getting there requires strategic planning, deploying data, fostering collaboration, investing in technology and adopting a sustainability mindset. The following five steps will help put your organization on the path toward leadership in supply chain resiliency. 

1. Put supply chains at the heart of your business strategies. 

For decades, supply chains were considered a cost center, and supply chain managers were focused on promoting efficiencies. This approach led to massive levels of outsourcing and very globalized supply chains. 

The world has changed in recent years, thanks to dramatic and unexpected developments such as the COVID-19 pandemic, the war in Ukraine, supplier and workforce shortages, and elevated levels of inflation. Climate issues continue to challenge supply chains, as do unforeseen events, such as migrating smoke from wildfires in Canada and the recent collapse of a stretch of I-95 in Philadelphia.

Forty-three percent of organizations in a recent Oxford Economics survey expect geopolitical changes to have a negative impact on their ability to deliver high-level customer experiences. In an effort to deal with supply chain challenges, 53% were considering creating more regional or local networks of vendors and suppliers, and 43% were looking to diversify their sourcing strategies. 

Leading companies understand that creating a risk-resilient supply chain capable of adapting to critical challenges makes the difference between surviving and thriving, and have moved supply chain issues to the center of their strategic deliberations. By taking a strategic focus to supply chain issues, businesses can mobilize new approaches to enable resiliency and explore new opportunities to differentiate themselves to their customers.

2. Future-proof supply chains against risk.

Companies possess a wealth of data, both structured and unstructured, from internal sources as well as from suppliers, contract manufacturers and logistics providers. They need visibility to that data in order to mitigate risk. Putting real-time and accurate data — from all nodes and tiers of the supply chain — into the hands of supply chain practitioners provides the visibility required to make timely and intelligent decisions. 

Companies that are oblivious to oncoming risk are hamstrung in their abilities to make strategic decisions. The Oxford Economics research showed that real-time responsiveness is viewed as a top barrier to supply chain success by 40% of organizations, while meeting customer time demands follows close behind, at 34%. 

By evaluating and analyzing the right data, companies can predict outcomes and simulate alternative responses and strategies. Simulation enables businesses to develop alternative plans and strategies that mitigate risk. Having these plans in place to address supply chain issues as they arise allows companies to respond to disruptions with flexibility and agility, and to adjust planning and manufacturing processes to better serve customers. 

3. Unleash the power of collaboration across the network. 

In this age of connectivity, no one does business alone. Companies rely on networks of suppliers, contract manufacturers, logistics service providers, maintenance teams and other trading partners to bring products to market and serve their customers. Collaboration involves breaking down silos, both internally and across company boundaries, by sharing data with supply chain partners, all of which improves decision making capabilities. 

Manufacturers use historical data to generate forecasts, live orders to discern market trends, external input such as weather patterns to gauge the impact on deliveries and customer demand, and social media content to understand consumer sentiment. Such efforts create a complete demand picture that they share with trading partners. That allows the entire network to fine-tune planning, production, and logistics processes, and to improve customer service by delivering exactly what they want, when they want it!  

The breaking down of silos across departmental and company boundaries enables end-to-end business processes and more informed and collaborative decision-making. Visibility across the supply chain is a key enabler to solving current and future business issues.  

4. Leverage intelligent technologies to drive business and process innovation. 

Consideration of technology investments should take place within the framework of how technology can help workers, not replace them. Analytical and predictive capabilities can identify patterns that the human eye can't see.   

Artificial intelligence and machine learning automate and streamline processes and drive role-based decision-support tools that improve worker effectiveness. Truck drivers want information about traffic conditions in real time to make delivery and timing adjustments. Manufacturing workers need real-time information about the performance of their production line or cell. Plant managers want the same information but at a higher level of granularity, to understand how the facility is performing, as do chief operating officers across multiple plants, to better understand enterprise performance.  

Technologies such as the internet of things collect myriads of data that can be used to develop smarter assets and products, driving process efficiencies. Real-time information on equipment and product performance allows companies to drive innovative business models, resulting in better products and higher levels of customer service.  

5. Make “going green” more than just a buzz phrase. 

The pressures to achieve sustainability are coming from many directions, including customers, employees, investors and regulatory bodies.  

According to Oxford Economics, sustainability leaders are more likely to view the supply chain as a competitive differentiator, while 72% of leaders, versus 47% of non-leaders, strive to place supply chain executives in positions that influence company strategy.  

Sustainability leaders prioritize their customers to a greater extent, seeking to understand their concerns about sustainably sourced and ethically designed products. They’re much more likely to see benefits in employee satisfaction, market share, corporate brand perception and customer satisfaction. 

There’s some evidence that sustainability’s influence on company strategies was on the wane at the height of the COVID-19 pandemic. But now, sustainability should be embedded into every process across the supply chain. Building a reputation for environmental responsibility helps create a loyal and satisfied customer base — the kind of resiliency that can endure any challenge. 

SAP: Enabling Intelligent Enterprises With Connectivity, Contextualization and Collaboration 

SAP’s strategy is to help every business run as an intelligent enterprise. “Our digital supply chain portfolio helps companies connect all of their processes from end to end,” says Richard Howells, SAP's vice president for thought leadership and awareness.  

SAP's portfolio of products facilitates processes from design until end of life. “They take our customers from research and development to long-term, medium-term, and short-term planning,” says Howells. “They include logistics and manufacturing processes as well as production and maintenance scheduling at the plant level as well as after sales service and maintenance.” 

SAP's holistic approach promotes internal connectivity, tying together design, planning, manufacturing, logistics, maintenance and service process, as well as supply chain solutions with financial and other business systems. 

“Connecting processes promotes contextualized decisions,” says Howells. “For example, providing the availability of the right data to planners enables them to facilitate simulations, scenarios and predictive processes.” 

The same connectivity fosters collaboration among supply chain partners such as suppliers, contract manufacturers and logistics service providers. Howells says the SAP Business Network “is where companies can connect and collaborate with current suppliers, contract manufacturers and other supply chain partners, as well as identify new trading partners.” 

SAP's devotion to sustainability revolves around three dimensions: zero waste, zero emissions and zero inequality across a business. “It's not only embedded in our own corporate practices,” says Howells. “It's also how we drive capabilities within our systems — to reduce risk across supply chains in a sustainable way. That's front and center in everything that we do.”

Resource Link: https://www.sap.com/cmp/dg/risk-resilient-sustainable-supply-chain/index.html?source=supplychainbrainlisticle