Supply chain disruption management requires resiliency and robustness.
Supply chain disruption is nothing new, but how can businesses prepare for it? Increased supply chain resilience is beneficial, as is keeping an open mind about what to anticipate and rethinking just-in-time manufacturing. Over a decade, disruptions cost corporations 45 percent of their annual revenues. According to Retsef Levi, an MIT Sloan professor of operations management, companies must accept unpredictability in their condition of operations. He offered three strategies for dealing with uncertainty:
Knowing the difference between regular and irregular operations, designing and implementing solutions to make your firm more resilient and robust, and managing exposure to predict disaster. An end-to-end strategy, for example, may put one supplier in control of the whole shipping route. According to Agmoni, travel periods from China to the Midwest in the United States averaged 34 to 74 days just before the epidemic. Uncertainty arises due to this unpredictability, which leads to the accumulation of safety stock.
When the cost of materials and shipping is growing, this will enable them to spend less on inventories. According to Levi, designers should reinvent goods to make them more adaptable and modular and develop cross-industry standards.