Why not present Supply Chain Management (SCM) procedures that can quickly increase resilient SCs? And why some of the prevailing SC processes are not appropriate for tackling such risks which demand quick responses?
The pandemic brought exceptional disturbances impacting our lives and has right away uncovered the weak spots in our conventional SCs processes, resulting in demand and supply disruptions in multiple businesses and customers, even today.
We must find strategies that lead businesses to adapt to new circumstances, currently more recurrent and potent. We will see these trends speeding up due to:
· The constant harmful human footprint on the planet.
· The escalating resource shortage.
· Our requirement of digitisation.
· The interdependency of our processes.
The interdependency and complex nature of SC operations today resulted in high monetary costs to cope with these incidents. SC leaders must place Risk Management, Resiliency, and Supply Chain Modelling at the top of any SC transformation.
The Supply Chain Risk Management (SCRM) issues and SC Resiliency (SCRes) will demand more awareness from specialists. The general concepts of SCRM and SCRes focus on handling SC modelling to enhance the efficiency of risk analysis, response planning and its benefits.
Moreover, for High-impact Low-probability (HILP) episodes, experts will have to adopt some of the procedures by applying the Disaster Relief Operations (DRO), which are considerable dissimilar from commercial SC procedures. Latest examinations through the long-term Coronavirus pandemic evidenced that most organisations are not satisfactorily organised.
What is Elastic?
Being elastic means reacting to changes in buyers and seller’s behaviour to the demand for a product or goods, which is regulated by how much the demand for goods varies as the price rises or falls. An inelastic item is one that consumers keep on purchasing even after a price variation. The elasticity of a product or service can change according to the number of nearby existing alternatives, its relative cost, and the amount of time passed since the price variation occurs.
Technology Supply chains (SCs) are constantly at the limit, with disruptions impacting the business globally. Leaders’ agendas to come back now place business resilience at the front to fight back this current-ever-changing circumstance.
As circumstances keep changing, the capacity to change operating and business models through Continuous Design will help companies surmount the disruption challenges; leaders can try out various options and manage complex uncertainties that require adjustments in a very interconnected-repetitive way.
A growing focus on Resilience
In recent years, the imperative for SC resilience has taken centre stage at many organisations. Trade wars, tariffs, natural disasters, and the current pandemic growing uncertainty led many decision-makers to put a greater focus on risk reduction.
Executives are trying alternative suppliers, materials, or routings to tackle the pandemic. The most challenging obstacle for many was that their SC strategy could not answer the disruption, deliver the lowest cost of distributing items, and do not help them tackle uncertainty.
While many businesses have flexibility built into their SCs to adapt to usual prediction areas, other factors vary rapidly. Global supply, eCommerce, and quick fulfilment have made SCs more vulnerable to devastation and disruption.
Lack of goods like food articles and microelectronics in 2020 confirmed that SC executives could no longer sustain essential Key Performance Indicators (KPIs) and data from conventional systems.
Key takeaways:
- Businesses that function in highly competitive productions recommend elastic goods and services since organisations are likely to be price-takers.
- When the good or service price achieves the elasticity stage, merchants and shoppers rapidly adapt their demand for that product or service.
- Elasticity is an essential economic measure for the most part for sellers of goods or services because it reveals how much of a good or service shoppers would spend when the price escalates or drop off.
- Goods or services that are elastic are either superfluous or substituted with an alternative.
Conclusions: Leaders will miss an extraordinary chance if they do not consider the Continuous Design approach that powers leading businesses.
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