The Covid-19 crisis has created supply chain disruptions on both the financial and operational sides. The beginning of 2022 caught procurement leaders in a very strong position, ready to show their ability to react to the many challenges, by delivering growth through game-changing strategies. With uncertainty still a live threat and severe economic impacts on a number of regions, the disruptions to supply chains continue to cause a negative impact in 2022.
How to respond to supply chain disruptions
It is of high importance during these periods of supply chain disruptions to keep monitoring all aspects of your business. Even though you navigate through financial and operational challenges you still need to pay attention to your customers’ needs, supplier requirements, and employees.
The reason why you need to keep your eyes open is because by taking the correct actions, procurement leaders can turn supply chain disruptions into important long-term improvements for the business. A priceless lesson we’ve all learned during the last 24 months is that disruptions can be a real catalyst for growth.
Adopting a world-class digital procurement solution to drive profit enhancements, mitigate and reduce risks and provide visibility and control of all your spend has imminently become your goal. As a specialist procurement partner, part of a global system integrator we continue to provide best-in-class service to our clients through our experts who live and breathe the world of procurement.
Being flexible, adaptable, and agile are more important than ever. Many of us have learned that if the need arises, it all comes down to being prepared and able to react quickly, having a risk management strategy in place and implementing technologies that offer the possibility to react in a timely manner and run efficient and compliant procurement processes while delivering savings.
Aligning procurement and supply chain is key
Juggling between the Covid-19 pandemic, labor shortages, natural hazards, and worldwide political instability, procurement has taken on a more strategic part to help mitigate existing challenges. As procurement is the process of getting the goods and services each business requires, and supply chain management can be seen as an extensive infrastructure needed to obtain those goods, we can state that supply chain management should ultimately be considered as one of the main responsibilities faced by a procurement function.
Procurement as a function helps companies achieve transparency and greater visibility with suppliers, especially in periods with increased disruptions, by allowing them to turn quickly to new suppliers and in this way secure business continuity. CPOs around the world ranked higher in their priorities two aspects, based on the recent events: to improve their risk management strategy and to ensure resilient procurement decisions. The key to becoming more resilient is to minimize risks in your supply chain and have the agility to quickly respond to disruptions caused by these risks.
As organizations strive to get out of this period successfully, procurement and supply chain teams need to work together to manage risk and supplier relationships but also to actively design supply chain networks to respond to their objectives and existing requirements.
An unpredictable world or a new normal?
We might look at these events through the rearview mirror at one point, but it will be important to carry all the good lessons we’ve learned from them into the future. These are our main recommendations for navigating supply chain disruptions successfully.
- Adopting and maintaining an innovative and agile business culture
- Enthusiasm to implement new technologies
- Don’t forget that supply chain disruptions, natural hazards, political instability are unavoidable
- Focus on people
- Improve risk management strategy to ensure resilient procurement decisions
- Build trust and transparency