With the WHO’s announcement that the omicron variant of the COVID-19 has indeed been confirmed, all eyes are on what affect this news will have on the global supply chain. But, if the past 2 years have taught us anything, we already have a good idea what’s going to happen. Read on to learn how you can mitigate supply chain disruption and learn from the past.
It’s a well-known phrase – hindsight is 20/20. But it’s not just about what we see behind us, it’s about what we now do with that information so that we have that same clear vision going forward.
COVID-19 did a number on supply chains worldwide. For instance, Ernst & Young LLP (EY US) conducted a survey of 200 senior-level supply chain executives in late 2020. In it 72% of respondents agreed that the pandemic had either a mostly or significantly negative effect on their company. Looking back, I recall large corporations in industries such as automotive and industrial taking the biggest hits. But of course, let’s be honest, it had a huge effect on pretty much everything and everybody. With companies closed, less was being produced, causing supply chain shortages. And with people out sick, the manpower was lacking.
As supply chains began to return to normal, we were introduced to the delta variant of COVID-19 and faced with a new set of supply chain issues. The variant, combined shortages of parts and raw materials, plus a lack of shipping capacity created troubling hurdles for worldwide goods trade, which had been a pillar of the global economy earlier in the pandemic.
Geographies that took the biggest hit from the Delta variant were the sources of goods, such as electronics, that are bought more frequently in tech-savvy and developed countries.
And now as we enter a third wave of the virus, we’re staring eye to eye with the Omicron variant. Similar to the Delta variant over the summer, the new Omicron variant could worsen the current labor shortage and supply chain issues lingering from mid-year as workers at logistics and manufacturing facilities could decide to stay home instead of working shoulder to shoulder.
In other words, it’s clear that what we thought we were leaving behind in 2020 followed us into 2021 and looks to still be lingering well into 2022.
So back to the “hindsight is 20/20” and the fact that we should use that hindsight to make a plan for the future. To blatantly state it – if you didn’t learn then, it’s time to learn now. If your company is still struggling with supply chain disruptions, I’m here to tell you that there are proven ways to ease that disruption and keep your business running as normally as possible. (Whatever normal is anymore.) And it’s all about visibility and automation.
Without visibility, you’re doing business in a vacuum. And it’s not just about having visibility of your Tier-1 suppliers, it’s seeing into your long-tail suppliers, as well as your whole supply chain activities. Like a delicate web, it’s all connected so you need to ensure you can see 100% of it.
Supply chain visibility is all about transparency—knowing where goods are at any given time, tracking movement, delivery, and thoroughly understanding who you’re doing business with. This refers not only to the transactional transparency of things like buying, selling and paying transactions, but also much more holistic transparency into who (not what) is underneath all those transactions, what they stand for, and why we should care.
A study we conducted with Harvard Business Review Analytic Services (HBRAS) found that businesses worldwide lack transparency in their supply chains. 60% of the 800 business leaders surveyed warn that poor visibility of who they do business with is a significant source of risk. And as many as 24% admit that they fail to effectively evaluate supplier business practices.
The survey with HBRAS also revealed that 60% of respondents warn that poor visibility of who they do business with is a significant source of risk. We discovered the biggest hurdles when it comes to greater transparency were determined to be:
manual processes,
lack of tools and technology,
and no way to properly analyse data.
In order to achieve an elite level of supply chain visibility and therefore better combat the Omicron variant’s affect, companies need smart technologies paired with smart solutions.
With the right automated tools built specifically for supply chain visibility, you can achieve:
What if you could prepare for supply chain disruptions before they happened? Or what about preparing your company for another wave of COVID-19? You can with supply chain visibility. Operating a supply chain with a strong foundation on data analysis and open lines of communication can decrease supply chain bottlenecks and even avoid disruptions entirely.
Manually updating supplier information leads to obsolete data, potential risks, and wasted time. But with the right automated technology, all that changes. For instance, Basware solutions deliver 100% visibility into your entire supply chain, meaning you reap the benefits of rich and complete supply chain data. Processing this data through Basware empowers you with the insights you need to make smart, data-based decisions that will lead to supply chain excellence.
It’s important to ensure you’re doing business with the right suppliers who align with you ethically, meet your price requirements, offer the right experience, have the capacity to meet your orders, and are financially stable. Having the right supply chain technology can guarantee your suppliers check all those boxes.
Listen, it’s been a wild ride the past 2 years. But there are ways to ease disruption in your supply chain. If you thought that after 2020, things would return to “normal,” then I urge you to reconsider. If the Delta and Omicron variants have taught us anything, it’s that we must be prepared for anything, we must be agile, and we must do all we can to have total visibility.