Right when you gain control of your supply chain and get it working optimally, there comes a disruption. These are like flies in the ointment and can send the whole facility on quite a trip. Worst comes to worst, your facility may come to a horrifying halt. Best comes to best, your facility avoids an oncoming supply chain disruption before it even happens.
But you lie somewhere in the middle. Your supply chain has been affected by a severe disruption and you are now in the eye of the storm. Here are the top four things to do when such issues hit your facility.
Communicate early, communicate often
Most organizations dread these moments, which is also why they do keep a certain contingency plan in their back pockets. But if you haven’t had the time to think of one, this is your first resort.
You will, as a manager, set the standards for communication within your facility. This will mean starting communication as early as possible and keep communicating as often as possible. But communicate about what?
The goal in this first stage is to get things moving
Inform the command centers about the detected disruption. Let it be known to your consumers that your facility is hit by disruption. Your being upfront about the delays and clearly stating the reasons for said delays is more likely to build trust and understanding between your distribution partners and you. Share regular updates on your website or via email.
But that is far from the only communication you will be doing. Keep your employees on speed dial and have them adhere to the initial response plan. Establish rules to be followed during this period and treat data on said disruption sensibly.
Secure the supply base
Once the initial steps are underway, you will have a rough estimate of the affected areas in your supply chain. Now it is time to secure the supply base. The priority in this phase should be put on discovery. Discovery of the full picture will let you attack issues in your chain with laser-focus.
If the impacts of the disruption seem to be hiding in plain sight, consider revisiting the following areas:
- Supply of materials: Irrespective of the causes of the disruption, a shortage in the supply of materials coming into the facilities can slow down your recovery process.
- Sourcing: No matter the scale of the disruption, your ability to discover, qualify and certify new business or programs and to transact businesses should stay unaffected.
- Logistics: While a local disruption may be all the more common, sometimes the root cause of the supply chain disruption isn’t under your control. These are global phenomena that affect everyone, like the CoVID-19 pandemic. Established hubs and supply networks may get limited in capacity as well as availability. This means that the availability of materials won’t necessarily mean supply as they would be stuck elsewhere.
This phase will demand you to make quick and educated decisions on the redeployment of underutilized assets as well as building flexibility in the usage of current assets. These are short term fixes for securing the supply base and need to be executed such that they do not obstruct your recovery.
Keep in mind that changes in the utilization of your existing assets will require you to adjust their maintenance schedules accordingly. This will also mean that you will likely have to be in more frequent contact with your MRO suppliers.
However you go about this, it is helpful to have a good understanding of inventory management basics and best practices.
Innovating & strengthening your enterprise
Regardless of the scenario, the way every enterprise reacts to a supply chain disruption will be unique. But something that is undeniable is the involvement of technology in strengthening the immunity of your facility against said disruptions.
Innovation and technology will be a primary tool in your supply chain disruption first-aid kit. This has arisen out of the modern supply chain’s need for resilience and flexibility.
With the rise of innovations in different industries, it is now a necessity to keep up with the demands of your circumstances. Consumer electronics manufacturers, for example, need to invest in data integration, business intelligence capabilities, KPI tracking ability for suppliers, event tracking capabilities, etc. to stay proactive with their SCMs. These necessities determine how well an enterprise reacts to a supply chain distribution.
Planning for recovery
Your goal from strategizing your recovery should be more than just making ends meet. It should be to build up a facility that is aware and strong enough to notice the early symptoms of impending disruption.
Here are the steps to take to plan for your supply chain disruption’s recovery:
- Identify key insights from recent disruptions to prepare for the future.
- Prepare to manage customer demand by taking financial contributions, customer importance, fairness, and need into account.
- Develop demand shaping methods.
- Establish emergency management protocols.
- Assess opportunities to diversify the supplier ecosystem.
Electronic manufacturers must go out of their way to acknowledge existing operating models – where and how work gets done and for what reason. They must be willing to entertain what the challenging ways of working are and build their workforces to be more transparent and intelligent.