This article describes a few strategies to lessen and prevent supply chain disruptions. Find more here.
In supply chain management, interruption in just a path of a given transportation mode can dramatically impact the entire supply chain and, at times, even take it up to a halt. As such, business leaders like P&O Ferries CEO and Maersk CEO work hard to add flexibility into the mode of transport they depend on in a proactive manner. As an example, some businesses utilise a flexible logistics strategy that relies on numerous modes of transport. They urge their logistic partners to mix up their mode of transport to incorporate all modes: trucks, trains, motorcycles, bicycles, vessels as well as helicopters. Investing in multimodal transportation practices including a combination of train, road and maritime transport and even considering various geographical entry points minimises the weaknesses and risks associated with counting on one mode.
Having a robust supply chain strategy could make businesses more resilient to supply-chain disruptions. There are two forms of supply management problems: the first is due to the supplier side, namely supplier selection, supplier relationship, supply preparation, transportation and logistics. The next one deals with demand management issues. They are issues linked to product introduction, manufacturer product line management, demand preparation, product rates and promotion preparation. So, what common methods can companies adopt to improve their capacity to sustain their operations when a major interruption hits? According to a current research, two strategies are increasingly demonstrating to be effective whenever a interruption happens. The initial one is known as a flexible supply base, and the second one is known as economic supply incentives. Although some in the market would contend that sourcing from the single supplier cuts expenses, it may cause problems as demand fluctuates or when it comes to an interruption. Thus, counting on numerous suppliers can offset the danger associated with sole sourcing. Having said that, economic supply incentives work whenever buyer provides incentives to cause more suppliers to enter the marketplace. The buyer could have more freedom this way by shifting production among vendors, specially in areas where there exists a small amount of suppliers.
To avoid incurring costs, various companies start thinking about alternate routes. For example, due to long delays at major international ports in some African states, some businesses recommend to shippers to build up new routes in addition to traditional paths. This tactic identifies and utilises other lesser-used ports. As opposed to counting on an individual major port, once the shipping company notice hefty traffic, they redirect items to more effective ports over the coastline and then transport them inland via rail or road. Based on maritime experts, this strategy has many advantages not merely in relieving pressure on overwhelmed hubs, but also in the financial growth of growing areas. Business leaders like AD Ports Group CEO would likely trust this view.