Late in the previous decade, supply chain management became a hot topic as large manufacturers and resellers tried to smooth out the bumps and bruises that came with disruptions to their global supply chains.
In this past decade, this concern has turned into a focus on supply chain resilience—that is, creating supply chains that can withstand both man-made and natural disruptions. While resilient supply chains might not be faster or leaner than alternatives, they are more able to stay up-and-running no matter what local conditions are like at any point in the chain.
Just how have supply chains grown more resilient? Better forecasting has played a huge role, thanks largely to advances in Big Data and monitoring technologies. As technology has improved, there is more visibility into supply chains and more rapid communication, which creates more flexibility. Redundant processes and real-time inventory management, along with good manufacturing practices, have also made supply chains more resilient.
Another way that supply chains are becoming more resilient is through the process of re-shoring. The previous few decades saw many processes off-shored to places where labor was cheaper. It didn’t take long for manufacturers to realize, however, that the added costs of dealing with disruptions, meeting quality standards, and keeping tight production schedules ate away at most of those savings. Supply chains were kept shorter and more secure simply by moving those processes back on-shore.
We predict that some manufacturers will continue to work on supply chain resilience in lock-step with global expansion through 2020 and beyond, while others will find ways to keep their supply chains shorter and more local. Either way, resilience will continue to be important into the next decade.