"In a rapidly evolving market, this inefficiency points to a significant loss in productivity and a barrier to effective day-to-day decision-making, not to mention grave concerns about their ability to prepare for the next major supply chain disruption," said Richard Lebovitz, CEO of LeanDNA, a leading intelligent supply chain execution platform.
Gut Decision Making
The absence of predictive data has companies operating as though they have no data at all. The vast majority of supply chain execs (92%) make gut decisions sometimes or more due to a lack of predictive guidance in their reports.
Worries and Uncertainty
At 56%, supply shortages are the most cited concern among executives, but are just one of the many worries mounting in 2024 around potential external disruptions supply chain leaders can't control. More than half (52%) are concerned about public health crises, while nearly as many cite natural disasters (50%), government regulations (49%), cyber-attacks (49%), and geopolitical conflicts (45%).
Workforce Implications
The confusion and chaos of the COVID-19 pandemic, natural disasters, geopolitical conflicts, and more inform how executives anticipate a disruption affecting their organization in 2024. Executives predict a supply chain disruption could impact their workforce —meaning potential layoffs or other labor impacts (47%) and reduced productivity (45%).
Bottom Line Tensions
A third of supply chain executives (33%) fear the next disruption will mean revenue loss, but stocking up is also a costly or infeasible option. This explains why 96% face pressure to balance preparedness for a major disruption with avoiding excess inventory.
A PR Nightmare
Customers and clients may have been understanding of disruptions during 2020, but they won't be so forgiving this time around—and the consequences could be dire. More than 2 in 5 leaders (45%) fear their organization's reputation would be damaged during a supply chain disruption, signaling that customers and clients won't tolerate the next breakdown—indeed, 36% also fear fractured supplier relationships.
Why They Struggle
Barriers to using real-time data for supply chain management include the current tech stack not supporting real-time data (44%) and lack of staff skills and training (55%). For some, upgrading their tech stack doesn't seem like an option: 48% report their current system is too ingrained, and another 26% believe their organization can't afford the implementation disruption.
More than four in five leaders (82%) agree that real-time data that does not provide actionable insights for decision-making is a waste of time and energy. While 82% report having some level of a real-time view of supply and demand, less than one in four (24%) have a predictive view, giving those companies a leg up when it comes to being able to take action and make decisions based on the insights.
Steps to Prepare for Disruptions
Supply chain executives are gearing up for future disruption with 92% of supply chain executives planning to ramp up investments in preparedness strategies. 87% are focused on resilience as a high priority, including 41% who put it at the top of their list.
An impressive 86% of supply chain leaders report their organizations have already made major changes to their processes or tech stack to improve preparedness for the next major supply chain disruptions. Over one-third (33%) have gone through a complete overhaul. This includes 41% that diversified their supply base, 39% that identified new or better vendors, 36% that reskilled their workforce, and 32% that partnered with third-party logistics experts.
Supply chain executives are putting tech in place to support their people. More than a third (37%) have deployed digital twin and other simulation technologies and more than a quarter (26%) have added on to enterprise resource planning (ERP) software for more functionality.
Perhaps most importantly, leaders want to be able to see more clearly what they have now, and what could be on the horizon. More than two in five (41%) have increased supply chain visibility to prepare for the next major disruption.
Data can do more than prepare for disruptions, it can allow businesses to become more efficient with their resources. With real-time data that could inform their business decisions, supply chain executives say they could improve logistics and inventory management (47%), identify changes in demand (45%), and enhance collaboration (44%).
"As an intelligent supply chain platform that empowers manufacturers to prioritize and collaborate to resolve critical material shortages and excesses, LeanDNA enables teams with a single source of truth for managing complex global supply chains," said Lebovitz. "We help companies improve on-time delivery and working capital levels through inventory visibility, recommended actions, and real-time collaboration with suppliers."
This survey and report by LeanDNA and Wakefield Research is a wake-up call for the supply chain industry. As companies plan to increase their investment in preparedness, there is a clear opportunity to embrace advanced analytics. By doing so, businesses can not only save valuable time but also gain a predictive edge in an increasingly volatile global market.
About LeanDNA
LeanDNA is a leading intelligent supply chain execution platform that enables supply chain teams with a single source of truth for inventory management and production readiness. This cloud-based platform synchronizes execution across the supply chain, empowering manufacturers to prioritize and collaborate to resolve critical material shortages and excesses. With LeanDNA, manufacturers improve on-time delivery and working capital levels by gaining visibility into current and incoming materials, actions based on inventory criticality, real-time collaboration with suppliers, and the ability to track progress toward inventory optimization goals. Learn more at LeanDNA.com.
SOURCE LeanDNA
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