An efficient, resilient supply chain is critical to success. While virtually no one would disagree with that, many companies’ supply chains are full of unaddressed weaknesses. The problem is it can be difficult to know where these shortcomings lie.
Studies show that 57% of businesses today have poor visibility into their supply chains, and 63% don’t use any technology to monitor supply chain performance. Organizations lack visibility, and without it, they can’t tell where their operations fall short.
Here are eight ways businesses can change to identify and address supply chain weaknesses.
Track Shipments With the IoT
The internet of things (IoT) provides one of the best solutions to supply chain transparency. One critical area to apply this technology in is flow mapping. Businesses should use IoT tracking devices to gain real-time insight into shipment location and quality.
Over time, IoT data will reveal trends that highlight potential weaknesses in the supply chain. For example, if shipments carried by one particular logistics provider or in one area encounter more disruptions than others, those are weak points that need addressing.
These sensors also help mitigate challenges as they arise. IoT tracking helped companies ensure safe vaccine deliveries by alerting workers to temperature fluctuations, guiding them to alter routes to deliver them before they expire. This real-time visibility can help address many common oversights in supply chain management.
Analyze Historical Data
Real-time data is crucial, but older information is also valuable to businesses. An excellent way to reveal weaknesses within the supply chain is to review data from past operations. If any negative trends emerge, companies know that’s where they can improve.
Customer reviews provide some of the most informative data. Common complaints about delivery times, product damage or similar factors reveal potential issues within a business’s supply chain. They can then analyze related processes more closely with IoT technology and benchmarking to see where problems arise.
Losses during peak seasons, repeated delays, past shortages and surpluses are also good historical data to analyze. Machine learning algorithms can help analyze this data to find trends and suggest potential solutions.
Employ Predictive Maintenance
Equipment failure is a common supply chain weakness across virtually every industry. The best way to address this obstacle is through better maintenance procedures. Preventive maintenance is better than reactive approaches, but predictive maintenance is the ideal solution.
Predictive maintenance uses IoT devices to analyze machine health indicators and predict when they’ll need repair. Measures like fluid sampling can catch issues before they cause damage, then the connected features of these devices alert employees. Businesses can then schedule repairs to prevent breakdowns and avoid unnecessary maintenance stops simultaneously.
These IoT-based maintenance procedures can apply to virtually any machine. Trucks and other vehicles are the most obvious in supply chain operations, but manufacturing machines and warehouse equipment can use them, too.
Pen Test to Find Cyber Risks
Cyber risks are some of the most important weaknesses to address in modern supply chains. Supply chain cyberattacks rose 42% in Q1 2021 alone, impacting up to 7 million people. Businesses can find and address the vulnerabilities these cybercriminals use through penetration testing.
Penetration testing, also called pen testing, involves cybersecurity experts attempting to break into a company’s network through various means. Their successes and failures in these tests reveal where protections are strong and where they can improve. These experts can then recommend steps to fix lingering vulnerabilities.
Cybercriminals frequently change their methods or use new techniques. As a result, it’s important to pen test regularly to stay up-to-date on the latest cybersecurity trends. Most businesses can get by with one test a year, but larger or more complex supply chains may need more.
Assess Supply Chain Partners
Supply chain weaknesses outside the company itself can still cause damage. Since these networks involve so many parties, businesses should also consider the risks that their supply chain partners pose. Logistics providers, software vendors, suppliers and more can all have weaknesses that impact their customers.
Given these third-party risks, businesses should assess their supply chain partners. That begins with transparency. Ask all third parties to provide information like their cybersecurity standards, real-time IoT data and vulnerability assessments. If their standards don’t live up to what companies need, they should reconsider their partnership.
Businesses should also review third parties before forging new partnerships. If supply chain partners can’t prove their reliability and transparency, they may be too big a risk.
In line with creating transparency with supply chain partners, businesses should communicate as much as possible. That includes communicating with third parties and internally between departments. The easier it is to share information, the sooner companies can recognize and respond to potential weaknesses.
Some of the best insights can come from areas companies often overlook. Truckers sometimes work more than 70 hours a week, so they’re intimately familiar with any issues in pre-planned routes or company vehicles. Letting them voice their concerns and potential solutions can help businesses find and address foundational problems.
Effective communication needs efficient channels to support it. Productivity software that connects multiple parties and instant messaging platforms will enable more timely communication than older methods like email.
Consolidate Data Solutions
Many of these other strategies rely on digital data. Data is the most valuable resource to businesses today, but many organizations struggle to manage it in large volumes. When data from various sources stays in silos, it becomes difficult to see and manage it all together,
Teams lose 20 hours a month when their tools aren’t centralized or integrated across the organization. Businesses need to consolidate their data channels and reporting through management software to keep it all in one place. From there, it’s easier to see trends, analyze information accurately and share findings.
Thankfully, plenty of software solutions today can consolidate data for companies to use. By bringing everything together, supply chains can be sure their insights represent the whole picture, leading to more effective changes.
Supply Chains Must Review Their Weaknesses
Supply chains are so complex and interconnected that risks can arise from many places. Since these networks serve as the backbone of other operations, companies must address their supply chain weaknesses. If they don’t actively look for and address these weak points, they’ll limit their efficiency and resiliency.
These eight steps can help find and fix common supply chain problems. Increasing visibility and communication will go a long way. When businesses apply these changes, they can stay on top of their supply chains.