In today’s era of evolving supply chains, economy rotation is very much in demand so as to maintain a high grade of manpower, needs and production are so much spread across lands and seas in the whole world, usually at a great cost and potential. As any successful business can say that, supply chain management is one of the most important parts of management. It maintains a great relationship and helps in further trade with suppliers and a strong communication is very much necessary it helps to avoid logistical errors and also prevent to maintain shipment delays.
Many companies need to get alert of current blind spot and creating a risk associated with complex. Market fluidity caused by COVID-19, alongside sweeping regulatory changes, has driven companies to many functioning regulatory to urgently re-evaluate their complex global supply chains to gain control of new and significant supplier risks very quick. Supply chain versatility is necessary for successful business flows, but it’s critical that companies evaluate and understand the risk associated with current and potential suppliers in their physical and digital supply chains.
The vast collection of organizations finds it very difficult to do an analysis of risk. The companies they directly contract with, like what Foxconn is to Apple, such as leaving them open to risk factors associated with the many tiers of sub-suppliers that exist underneath primary suppliers. A provider of a key component could be bought by a foreign company, a business could introduce unethical labor practices; the potential risks are widely varied.
Since companies don’t get success to find a new way to analyze and can take action to fast changing supplier risk, the companies will surely suffer further business disruption that causes great impact over the business operation. The companies run under supervision of government and the manufacturers that supply them are also at risk from economic and can also expect a risk of national security, without clear and continuous visibility into supply chain risk.
Efforts of Business to Control Risk
Companies have taken few steps to meet supplier risk in recent months.
These steps include:
- Introducing digital tools to work more frequent and very deeply supplier risk assumption. In U.S. based companies they are planning to use automation in the supply chain in response to COVID-19 this was a survey by pricewaterhousecoopers of chief financial officers.
- To prevent future shocks and more products on hand companies build an inventory of finished goods and raw materials.
Big countries like China are planning to reduce geographic concentration in global supply chain there has been a lot of talk, especially in countries such as China as sanctions imposed by foreign governments, like the U.S. and U.K., gets increase and further order that companies can do business with. Like Apple, electronics manufacturers have spent years working with suppliers in China because of its large, low-cost labor force, supplier infrastructure, and efficient logistics. Because of this geographic reliance, production to others countries gets difficult and the process of identifying the associated risk it is not always easy and very frequent , that is why relocation also gets difficult in some parts of the globe.
Building Flexibility in Supply Chains
Nowadays companies are now taking supply chain more limber, flexible and very much transparent from a risk point of view to carry forward of the crisis. To get a high definition picture of company’s eco system and finding where is the risk present in the current system of supply chains and will create to de-couple from China.
There are some examples which has created the first AI powered multi factory risk management platform which is used to monitor their operations and many businesses were so grateful for this innovation, globally the supply chain provide a clear view of supply risk with the help of this risk management platform, it is discovered by interos. This platform provides an AI originated graph and natural language understanding (NLU) to figure out company’s supply chain in physical and digital format and also in ecosystem, business relationship etc.
With the use of AI there is a continuous monitoring of more than 50 million suppliers and business organization around the globe.
By applying AI monitoring platform Nth tier suppliers and business partners will able to monitor 250 million risks event per month with five key factors which are financial, operational, governance, geographic and cybersecurity with 85000 data source.
As COVID-19 pandemic breaks backbone of many industries and businesses, INTEROS conuer 500 percent increase in inbound requests from possible customers that includes government agencies and fortune companies. The increasing demand of products like INTEROS offers is a proof of growing risk associated with supply chain global operations which is a top count of playbook for the balance of 2020.