As the globe has become increasingly interconnected, the impact of disruption is felt on a larger scale. And nowhere has this been felt more than in our global supply chains, with the global pandemic highlighting the lack of resilience in the industry.
Disruption is, of course inevitable. This has been abundantly clear over the last few years. However, many businesses are totally dependent on a predictable supply chain to produce goods or deliver an end product. A supply chain failure can lead to contractual penalties, lost reputation and potentially business failure, having an effective mitigation strategy is key. While disruptive events differ, it is clear that real-time visibility across the entire supply chain is non-negotiable for managing it, as it supports a stronger decision-making platform, reducing the impact on the damage to partners, suppliers and end customers.
Increased visibility improves the decision-making platform
If businesses want to keep shelves stocked, then they need to have a deep understanding of how to track and control inventory, which requires real-time visibility in every corner of the supply chain.
With real-time alerts and updates, businesses can make faster decisions when responding to potential disruption, for instance by changing the route or method of transportation. Moreover, not only does this increased visibility give businesses the ability to improve the speed at which they can make these decisions, but also accurate real-time data allows them to make more calculated judgements about the alternative shipping and transportation paths that are available, as they will have a clearer picture of the situation and, in turn, what is needed to address it.
This does not mean achieving real-time supply chain visibility is easy. In an increasingly globalised world, our supply chains are more interconnected than ever, and this means that the tracking and managing of inventory needs to be done across multiple locations, which could include retail locations, warehouses, and manufacturers. And because these locations and operations are typically owned by different companies, this can make creating a single source of truth quite difficult to achieve, collecting data from each point in the chain and each data owner – with their own data formats and rules, introducing third party data like vessel tracking, weather forecasts, tide times, local events, public holidays, local traffic conditions etc, is no mean feat.
Establishing real-time visibility
Many businesses have turned to new technologies, like advanced analytics, to achieve real-time visibility and create advanced forecasts for supply chains ahead of time. These more sophisticated algorithms work on both new and old data, which increases accuracy. However, they require a strong and stable data connection between on-site facilities and the cloud, as well as low-latency services that offer constant access to important data.
These technologies help paint a clearer picture of supply chain operations. Where data is shared to align everyone involved across the supply chain, it translates better operations directly into satisfaction both for internal stakeholders and customers.
The cyber risk of hyper-connectedness
However, the increasing interconnection between modern-day supply chains does not come without its risks. While it increases transparency, it also inevitably expands the cyberattack surface. The increased use of IoT sensors to modernise and interlink supply chains means that there are more endpoints and, in turn, entry points for cyberattacks. This puts not only the device owner at risk but also every company in the supply chain since their networks are interconnected.
The disruption caused by cyberattacks, as well as the risk of breached data, put organisations at risk of financial consequences like lost revenue or penalties, as well as more material losses like hits to business reputation and productivity. Robust security and risk policy processes are therefore necessary at every stage to make ensure each company maintains the same standards and doesn’t introduce a “weak link”.
The UK Government have previously laid out recommendations for improving supply chain security. Put simply, effective risk management and more direct control over relationships with suppliers is key. This could mean requiring Cyber Essentials Plus or the need for contracts to include a “right to audit.”
If your organisation doesn’t have a senior security leader, you’ll have to take additional measures to educate all key decision-makers so they are aware of, and act on the potential risks. For example, articulating the full requirements and obligations between partners to minimise supply chain exposure. This is where security audits can be beneficial, as a full audit can make sure everyone knows the risks well enough to identify them quickly and solve the issue with time to spare.
Minimising the risk
Disruption is inevitable, but to address it properly, you need to know about it and take action quickly. The end goal of all supply chains is the timely delivery of goods. But where companies don’t have the visibility to track and react to potential disruption as it arises, the whole network is at risk of delays, as goods may have to be diverted through less time-efficient routes, impacting customer satisfaction and the supplier-partner relationship.
While sharing real-time data across the supply chain offers resiliency, businesses need to be fully aware of the risks that come with data sharing for supply chain optimisation. While critical to the long-term success and resiliency of supply chains, cybersecurity processes and policies across the board need to ensure that the opportunity of the increased hyper-connectedness isn’t outweighed by the risk.
As the Head of Products & Operations at GCX, Jonathan commands a wealth of experience within the IT channel. His expert insights, strategic prowess and unwavering commitment to innovation and client-centric solutions cement his position as a noteworthy voice in the EMEA IT channel landscape.