Supply Chain Disruptions and How To Respond
Preparing for disruptions is a crucial part of supply chain management. Even the most well-managed supply chain is still vulnerable to unexpected challenges. To manage unexpected disruptions, your entire supply chain will need to be agile and adaptable.
This is particularly important for global supply chains. One small disruption in one country can cause a ripple effect all over the world with lasting consequences. For example, a disruption in the medical supply chain might mean that a patient has to go without their medication, or that a doctor can’t perform an important surgery.
At Unilog, we manage the entire supply chain from end-to-end for our clients. While we can’t completely prevent supply chain disruptions, we can help you respond efficiently when they do happen to keep your end customers happy. Our Logivice software serves as the control tower for your entire supply chain and notifies you of potential problems before they happen.
In this article, we’ll take a look at some of the most common supply chain disruptions and why they happen. We’ll also talk about how you can respond to minimize delays and keep your customers happy.
Types of Supply Chain Disruptions
There are many different types of supply chain disruptions that happen throughout the course of your work. Some of these disruptions are impossible to prevent, while others are within your control.
Many minor supply chain disruptions happen as a result of human error. A certain level of human error is to be expected across a global supply chain as there are so many moving parts to consider.
These errors can happen at any point along the supply chain. For example, an order might not be properly entered into the computer system or packed correctly. Luckily, these errors are relatively easy to catch and prevent with the right technology.
Companies around the world have been dealing with labor shortages over the past few years, which has caused supply chain delays. Many labor shortages are temporary – for example, many warehouses had to shut down for two-week periods as a result of COVID-19 outbreaks. However, long-term staffing shortages can also happen due to economic and social changes.
Weather can also have an effect on the supply chain, especially in the case of extreme events like hurricanes and earthquakes. In very severe cases, extreme weather can even damage your facilities, making it difficult to safely store your inventory.
Even if your organization’s headquarters and warehouses aren’t affected by extreme weather, your shipping routes might still go through affected areas. Even standard snowstorms and thunderstorms can cause temporary delays.
Raw Material Shortages
While raw material shortages are rare, they can happen in certain industries. Sudden raw material shortages typically happen as a result of extreme or unpredictable fluctuations in demand. However, organizations typically have some advance warning about raw material shortages, giving them time to prepare and find alternatives.
Using Automation To Manage Supply Chain Disruptions
Automated technology is one of the most efficient ways to manage supply chain disruptions. At Unilog, we found that in order to identify and prevent abnormalities in our clients’ systems, we needed to automate many aspects of order management.
We created our Logivice software program to solve this problem. Logivice aggregates order information from across the supply chain, so you can see exactly where all of your inventory and orders are and where they need to go next. With all of this information in one place, the system can monitor for any potential problems and notify users as such.
This software program aggregates information from warehouse systems, client CRMs, and shipping providers. In some cases, IoT trackers use sensors to automatically locate products without any manual intervention. This provides transparency and facilitates communication between different parts of the supply chain. Many supply chain problems happen as a result of a lack of communication between delivery partners, but Logivice is designed to prevent this.
Logivice also consistently sends out notifications about the status of your orders to prevent delays from happening. For example, if an order is supposed to go out by the end of the day and hasn’t been processed by the afternoon, you would receive a notification, giving you enough time to make sure the order is sent out on time.
Other Ways To Minimize Supply Chain Disruptions
Automation is an effective way to prevent many short-term supply chain disruptions. Here are some other steps you can take to handle these disruptions and keep your supply chain flowing smoothly.
- Build an emergency inventory supply. This ensures that you’ll have some product available in periods of high demand or during material shortages.
- Work with multiple suppliers. If you rely entirely on one supplier, your operations could collapse if that supplier encounters labor shortages, equipment issues, natural disasters, or any other challenges. Working with multiple suppliers ensures that you’ll be able to keep things running, even in the event of an emergency. Ideally, your suppliers should be geographically spread out to avoid location-specific disruptions.
- Use supply/demand forecasting. It’s normal for supply and demand to fluctuate during specific times of the year. Advanced supply and demand forecasting models can help you plan ahead for periods of high demand.
- Conduct regular risk evaluations. Risk evaluations will help you identify places where your supply chain is most vulnerable. These evaluations should happen periodically, as new risk factors can pop up as your supply chain changes.
To keep your customers happy, you’ll need to be prepared for supply chain disruptions. Automation and IoT technology across your supply chain will help you stay on top of your orders across a global supply chain.
If you’re struggling to manage your supply chain on your own, consider working with a 4PL provider like Unilog. 4PLs optimize your entire supply chain from end-to-end, helping you find everything from reliable suppliers to the right shipping providers. This gives you more time to focus on running your business and keeping your customers happy. Contact us today to learn more about how we can help.