Supply chains are facing massive disruption as the coronavirus panic grips the world. Increasing demands for commodities, food and medical supplies put immense pressure on supply companies, yet many have had to shut down factories due to COVID-19 spread.
There are ways we can mitigate the damage done to our supply chains and prepare ourselves better in the future. However, it will require digital disruption.
How are supply chains affected?
Some companies, such as Fiat Chrysler, have had to temporarily shut down production in certain countries due to an inability to source from other countries such as China. As a powerhouse of production, China’s lockdowns have resulted in many companies unable to access their regular sources of materials and production.
This is not just in relation to Chinese imports. Many countries around the world have gone into lockdown and most have closed or tightened their borders. Goods can no longer be transported easily across these borders.
The solution to our supply chains issues
There are various ways we can fix these problems and create more traceability in supply chains. These include digitalization, implementing blockchain to create improved data privacy, and taking the leap towards digitalization when possible. Postponing digitalization will only hurt businesses in the future when disruptions occur again as companies will not be prepared.
– Make digitalization a priority.
Digitalization should be central to your business – not merely an afterthought. Supply chains are becoming digital and companies adopting traditional and paper-based methods are lagging behind. To avoid this, companies should make digitalization a core value of their business and an ultimate priority.
You can do this by adopting nascent technologies such as blockchain, artificial intelligence and automation. This will set your company ahead when digitalization becomes the norm in the future and will also ensure both cost savings and efficiency.
– Implement blockchain in your supply chain.
Blockchain technology is a necessary foundation for many supply chains. Blockchain-backed platforms provide traceability, transparency and easy auditability. In times of crisis, blockchain allows for trust in secure, transparent and up-to-date information.
Of course, blockchain technology doesn’t solve supply chain issues on its own. It does, however, provide the perfect framework for data-tracking platforms and decentralized methods of record-keeping.
– Realize the value of your data.
The World Economic Forum points out that, while many companies have access to Tier 1 supply chain data, “The lack of visibility is a problem that stems from other suppliers who are Tier 2 or even further up the supply chain.”
Therefore, we should incentivise suppliers to share their data through supply chain credit and programs.
Blockchain enables this. Companies provide a centralized place for all suppliers to share their supply chain data in a private and secure way. Blockchain can also help to support loyalty programs, rewards and credits.
Data is central to supply chains. Accessing data for ultimate transparency can ensure that companies are prepared for the future and have all the resources possible at hand.