Tag: Risk Management
The Supply Chain Due Diligence Act, commonly referred to as the Supply Chain Act for short, puts companies under pressure to act: from January 1, 2023, all companies in Germany with more than 3,000 employees will be co-responsible for ensuring that human rights are respected in their supply chain. Worldwide, 100 million people are affected by modern slavery, almost 80 percent of whom are children. The law aims to give these people a better future and contains a catalog of eleven internationally recognized human rights conventions. Read more
With climate change, weather hazards are becoming more likely. And with this, the risks for supply chain disruptions are increasing, too. Resulting large-scale power outages could bring production facilities at suppliers to a standstill. Or their plants themselves could be damaged by severe weather or forest fires. Read more
2021 is the year of supply chain disruptions. It’s not just the transport routes, but also the production of goods itself that is severely impacted: New local or regional Covid lockdowns keep slowing down manufacturing, especially in Asia. The ongoing chip shortage hits more and more industries. The power outage in Texas first knocked out the local petrochemical plants in February — then, its effects swept across the entire plastics supply chain worldwide. … The list could go on and on. Read more
For more than a year now, logistics and supply chain managers around the world have been struggling with unprecedented challenges. The impact from the first coronavirus-induced shutdowns, when supply chains and transportation networks around the world collapsed, continues to ripple through the industry. High volatility in demand, natural disasters and vessel incidents such as the recent one blocking the Suez Canal have further aggravated the situation.
Problem is, transportation capacity is extremely scarce and in hot demand. Numerous aircraft are still grounded. Container shortages continue to persist for quite a while. All of this is not only hampering sea and air cargo, but also road transports.
As a result, freight rates skyrocketed, as did uncertainty for manufacturers that rely on smoothly functioning logistics chains. In many cases, it’s unclear or at least hardly possible to plan when exactly their materials are going to be transported. So, the ever more pressing question is: How can companies best secure their shipments and thus ensure the flow of supplies to their plants and customers? Read more
Although the global pandemic continues, we should always keep positive mindsets. I am located in Shanghai, China. New local COVID-19 infected people just appeared in Shanghai after several of months of no infections. But people here are not in panic after experiencing the pandemic ‘war’ last year. Instead we are full of a sense of security resulting from three aspects – SPEED, PROCESS, and SOVEREIGNTY.
“High demand, low supply”: what a nightmare for supply chain managers. And this doesn’t just happen in boom times. In economically uncertain phases, too, supply bottlenecks are more than painful for businesses. This can currently be witnessed for the microchip shortage the automotive industry (among others) is battling with.
Thus, it is all the more important to safeguard production by having a sophisticated capacity management system for critical components in place. But what does this mean in practice? What is the difference to conventional demand collaboration with suppliers? And which aspects do manufacturers need to consider? Read more
In the last two posts of my blog series, I focused on taking the first steps in dealing with an acute crisis. So far, I have emphasized the importance of integrating supply chain management and risk management, as well as taking ad-hoc measures to counter the impacts of Covid-19. Now, the next step is to take medium and long-term measures to make supply chains resilient in the long run. Read more
Recently, in the first part of my blog article series “Supply Chain Risk Management – far more than just a way out of the current crisis“, I highlighted the importance of linking the two disciplines of Risk Management and Supply Chain Management when managing crises. There is another important aspect to not just surviving times of crisis, but to come out of these strengthened. And that is the time factor.
For this reason, the second part of this blog article series is dedicated to the following questions: Where do I start? What ad-hoc measures can I implement to mitigate impact? What can I quickly do to protect my supply chain? Read more
The coronavirus crisis has revealed a long-standing challenge for suppliers even more clearly: How reliable are the demand forecasts they receive from their customers? High volatility and uncertainties in demand forecasting are not limited to pandemic times. Even in the “normal state”, the originally reported requirements can differ considerably from the materials actually called off. The decisive question is therefore: How can you improve forecasting and thus also achieve a higher level of planning accuracy? Read more
The current coronavirus crisis clearly shows how vulnerable and susceptible to disruption supply chains are today. It also shows how important it is to anticipate disruptions of any kind in order to minimize their impact. In this context, supply chain risk management plays a major role. Essentially, it is a matter of finding answers to the following questions:
- What risks is my supply chain exposed to?
- How can I identify problems in my supply chain as quickly as possible, catchword early warning system?
- What do I need to do to minimize loss and to be even stronger in the end?
- As well as the lessons learnt: Which measures should I implement to ensure that I can effectively respond to any future risks?