[The Jolt] Build a more resilient supply chain in 3 steps

Singapore - Given the current economic environment, businesses should look to their supply chain to gain greater efficiencies, says a top UPS executive. He lends us three steps to build a more resilient supply chain.

According to Sebastian Chan, senior VP for freight forwarding and contract logistics at UPS, a company can enhance its supply chain resilience in an increasingly risk-filled environment through these three key recommendations:

Step one: Assess your supply chain and develop contingencies

Map out the existing supply chains and access points of vulnerabilities. These could be a key supplier critical to the business, a bottleneck caused by using a single port of entry for all products into a continent or dependence on a single mode of transportation that can make a company's supply chain susceptible to natural disasters. Identify these points and develop contingency plans to mitigate risks. For example, alleviate bottleneck by setting up alternate entry points for products to less-crowded ports. Adopting a multi-modal strategy give companies flexibility to move products if there is a failure in the primary mode of transportation.

Step two: Ensure visibility across your supply chain

Because supply chains today span multiple continents and multiple partners, companies need visibility into the progress of the entire supply chain - from the progress of purchase orders through to the delivery of the products to the facility. Having real-time visibility across the supply chain will enable businesses to identify a problem as soon as it occurs, allowing contingency plans to be put promptly into action. Supply chain visibility also enables companies to manage their product life-cycles more effectively, thereby reducing inventory holding cost and improving cash flow.

Step three: Develop key partnerships with your logistics providers

Companies need to understand the importance of developing trusted partnerships with their logistics providers to increase resilience of the business' supply chain. Integrated logistics partners have the ability to provide supplier management services, enable excellent visibility to products within the supply chain and implement a multi-modal strategy. They also enable smooth trans-border movement of goods and can quickly implement an alternate operating plan to get around bottlenecks.

While the challenges are daunting, there is an upside - an opportunity for competitive advantage. By pursuing risk mitigation and resiliency strategies, supply chain executives can help their organisations grow and retain customers, increase revenues and profits and improve shareholder value.