As businesses grow and diversify managers will experience greater and greater challenges in their supply chains.
These challenges can be due to pressures from elements within their own business or from external sources.
External challenges in the supply chain can be:
- Changes in material availability – maybe a supplier or vendor is not available or cannot meet your demands
- Competitive technological developments
- Conflicts or other forms of restrictions to movement of goods or materials – a big example being the Covid-19 crisis in 2020 or the ash cloud in Europe in 2010.
- An increase in regulatory checks for your materials or goods, either export or import
- Distance to supplier – the longer the supply chain the greater the challenge
Internal challenges to the supply chain are:
- Pressures from internal sales to meet supply targets
- Workforce restrictions from finance due to budget controls
- Breakdown of IT systems
- Communication between divisions
- Increased regulatory checks on internal systems
- Distances between manufacturing or distribution centres and the market place
Supply chains are facing all of the above challenges and so need to be nimble, flexible and responsive to change. A good supply chain must have plans in place should any of the above affect a business.
All of these challenges aren’t necessarily a bad thing, they can be useful to drive a business forward. Opportunities to make your business stronger through these sorts of trials will make you leaner and meaner.
You may not realise it but you very likely have a supply chain, or at least are a part of it. You may be a part of the supply chain of a customer. Business needs to be aware and change to make themselves indispensable to their clients.
Everyone is part of the supply chain and has a responsibility to be as efficient, nimble and adaptable as possible. Changes will happen and stakeholders will need to do this in a responsible way, without impacting other parts of the business.