The pandemic proved catastrophic events beyond logistics and supply chain management control. Last year, for example, many businesses helplessly watched as losses mounted from a $400 million hourly hit to the global economy. Likewise, no one could have predicted the impact of the grounded Ever Given in the Suez Canal.
Yet too often, businesses damage their reputation for unseen aspects of the lengthy supply chain. Keeping your company’s good name involves more than maintaining a positive culture in all phases of your operation. The manufacturing sector, in particular, must rely on the trust of global supply chain management to protect its integrity.
If you want to learn ways to reduce your exposure risk, keep reading. Here are some tips that can help you ensure all your supply chain partners are working in your best interest.
Why Logistics and Supply Chain Management Matters
The UK manufacturing industry employs nearly 3 million people. Yet often, the manufacturing industry relies on various outside sources to assemble its secondary products.
Quality control is essential for ensuring the manufacturer presents the best product possible. Therefore, you must pay much attention to the integrity of the parts made on the company’s behalf.
Yet, it’s possible to associate with unsavoury players when you don’t know your manufacturing partners. Your product may be the best in the industry, but your hard work becomes wasted if trust gets lost from an outside source.
When a garment factory collapsed and killed 1100 workers, the entire fashion industry felt the effects. Even the workshop building needs scrutinising. Yet, the incident also exposed how working conditions can affect the purchaser’s reputation.
The global effects on chain management supply can instantly turn your credibility upside down without your knowledge. An innovation can suddenly get derailed by a single source in the supply chain that operates outside the law.
A variety of issues can arise from business operations worldwide that don’t follow reasonable guidelines. For example, without due diligence by the manufacturer, some suppliers can damage corporate reputations by association.
For example, a cog in the supply chain may use poor working conditions or slave labour to produce your part. In other cases, an unmonitored business might provide unsafe materials to the manufacturer. Any of these incidents will come back to harm your company’s reputation.
Develop Strategies to Reduce Risk
Protecting your company’s global perception requires a hands-on approach to supply chain management. While it may be challenging to have eyes on all your supply partners, there are methods for mitigating the risk.
Begin by taking the temperature of your company’s reputation globally. The internet has given businesses many ways to discover what the world thinks about our credibility. Then, you can use effective strategies to keep closer tabs on your global supply chain management.
Widen Your Supply Net
Prevention is worth what most say it is worth. For example, diversifying your base of chain management supply will help if one player misbehaves. Also, many businesses realized benefits by developing supply chain partners closer to home.
When the chain management supply stalled the movement of semiconductors globally, the United States took action. The US Government committed Billions to create incentives for local product manufacturers. As a result, in five to ten years, the nation hopes to be on track for a burgeoning semiconductor industry on the continent.
While adding more parts to your supply chain might seem counterproductive, having a fallback alternative protects the operation. Even if suppliers have unavoidable challenges, a backup supplier will keep your factory running.
Perform Risk Assessment
A detailed risk management plan can help identify current or potential problems with suppliers. You will likely need to reduce your supply chain to individual elements and study them closely.
Yet, performing a check of your entire operation’s supply chain will result in more visibility. Knowing where your materials come from may also help you find better solutions for production. The exercise gives your business more data for tracking every stage of the supply chain to improve delivery efficiency.
Including your supply partners in the process is another aspect of reducing your risk. Sharing the responsibility of implementing a plan will engage suppliers in taking ownership. You will also learn whether each supplier is in line with the strategy.
Regular Updates
It’s critical to continue reviewing a supply chain management strategy regularly. A supplier’s situation can change at any moment, so staying informed will protect your interests. In addition, a regular review will be a maintenance schedule for your global supply chain management system.
Creating alternate plans is easier when inefficiencies get detected early. For example, a deeper look at a supplier’s process might reveal inadequate materials getting used. In addition, your business can transition to new suppliers faster when you have visibility from all sources.
Risk Insurance
Insurance policies are available to provide contingencies for almost any circumstance. So whether you need to recall a product or suspend operations briefly, the business will remain protected.
The risk management plan will help identify places where coverage is lacking. Every manufacturer needs liability coverage for a variety of reasons.
No one could have predicted the far-reaching effects of COVID-19 on global supply chain management. But insurance is the best way to plan for the worst.
Technology is Crucial
Data is essential for increasing knowledge about your supply chain management. There is no better way to increase visibility than implementing effective supply chain management software.
More significantly, technology has become essential in preventing loss when disaster strikes. A study showed that 92% of businesses that kept up with technological advancement during COVID-19 responded faster. These positive effects enable those companies to address the increase in demand with better results.
Use a trusted source of information that details every facet of your supply chain in real-time. Your response time to challenges improves when you get notified of problems when they happen. In addition, if you plan a supply chain management platform from end to end, the data can also increase productivity in the factory.
More Is at Stake Than Ever Before
There are more elements to the global supply chain management industry than the eye can see. As business widens its scope worldwide, more influences can disrupt the best businesses. Often, it’s too late to mitigate the damage when unsavoury characters go unnoticed.
Planning is an excellent start for protecting the image you have worked hard to develop. Technology has advanced to provide better information faster than ever before. However, your reputation depends on knowing your supply chain partners.
Keep your business integrity intact by using the best logistics and supply chain management. Request a free demo today to learn how we can assist you in streamlining your procurement process.
