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Minimizing Supply Chain Disruption with Diversification


Supply chain resiliency is only as strong as, well, its weakest link. Pun completely intended. Nevertheless, there are mitigating components worth implementing across your entire supply chain model. You need to have this conversation with your logistics team.


The question remains – is it possible to drastically minimize supply chain disruption with adequate and multi-channel diversification? Through multi-echelon networks, backup suppliers, and proactive continuity planning, a supply chain can become bulletproof in any type of market regardless of any unwarranted commerce or service disturbance.


Reducing overexposed supply chains and mitigating logistical risks can’t come without analytical preparation and predictive indicators. Being proactive with your supply chain will be the difference between forecasted longevity or near immediate bankruptcy. 



Multi-Echelon Networks


Multi echelon, in this case, is taking a more omni-channel and comprehensively transparent approach to agent networks and ultimately global reach instead of its typical inventory governing concept. Having a well-connected supply chain and logistics model will invariably decrease risks due to closures, pandemics, natural disasters, and any other form of disruption that could alter the method in which your chain of supply operates. 


Think of acquiring a multi echelon model of networks as an “if this, then that” contingency plan. If your clearing agent in India is forced out of work due to a local crisis, having another agent readily available essentially eliminates any disruption that would have otherwise thrown up massive blocks within your operational procedures.


A continuity plan even before implementing the actual continuity plan? 


Yes, to a certain degree.


Seamless re-routings are also an option with tiered networks. Partnering with a team of logistics experts focused on solutions allows for efficient planning and thorough oversight collectively working together to mitigate risks and expedite the continuation of supply chain optimization. 


How connected is your international supply chain management sector?



Supplier Diversification


The one thing ‘diversification’ at its core is attempting to prevent is losing everything in one unfortunate swoop. This is the case in all diversified instances – money, businesses, investments, and in this article, your suppliers.


It is more apparent now than ever before that companies will be implementing predictive analysis in the form of contingency planning post COVID-19. This global pandemic is altering the way we work, communicate, shop, and plan for the future.


The Novel Coronavirus has exposed weak links within heavy hitting supply chains and continues to be a lesson in risk management. Whether the next disruption is due to a natural disaster, political motivation, or electronically hijacked, one thing is certain – every business from top tier medically essential personnel to your neighborhood coffee shop will be better prepared – and supplier diversification will be a place they start.


We were beginning to see the importance of supplier diversification over the last couple of years during the China tariff impositions and all-out trade war. While the importance of wholesale was still very prevalent, the need for a consistent supply was more important. No supply = no business.


Mylan CEO, Heather Bresch recently told CNBC she understands that supplies cannot come from a single country alone – instead global distribution comes from a functionally collaborative effort.

Mylan is a notable pharmaceutical company taxed with the continuous distribution of drugs all around the world – but so are you – not necessarily within the pharma industry, but in charge of a supply chain depended on by many people, warranting the necessary extra steps needed to ensure procedural flow null of any unforeseen hiccups. 

Have a main supplier, but also have a backup you can depend on just as much, then take it a step further and have a backup for your backup. This may initially seem redundant, but the importance of acquiring a reliable team of suppliers ready to ship at any given moment will always be the difference between production halt and streamlined operational efficiency – no matter what.


Continuity Planning

We have detailed the importance of a solid continuity plan in a previous post, if you are interested in diving a bit deeper.

Click this link for more information on why you need operational continuity.

How will your operations workflow adjust during the next disruption?

  • Find alternate routings for expedited inventory shipments

  • Anticipate fluctuating costs

  • Maintain visibility to real-time status and adjust the business and customer expectations accordingly


Continuity planning, on a foundational level, is diversifying procedures into a standardized operating process to be implemented during a crisis. Bridging the gaps caused by detrimental issues of any size guarantee your company will be able to continue to provide a service – whether deemed essential or nonessential.

Continuity planning for a business is operational insurance.

Bringing it full circle – minimizing supply chain disruption comes down to how well you have diversified your risk over the years.


Conclusion

We understand the importance of keeping your supply chain open and fully functional. Our job is to see these issues before they arise and mitigate risk according to our creative solutions and customized service offerings. 

As a cross-functional team of logistics experts, we continue to help clients navigate areas of risk, planning, transportation, distribution, Customs, regulatory, and compliance. Our focus is never on an individual product group or service offering but rather a comprehensive approach to effectively managing and optimizing the supply chain.

Our Single Source Global Management System provides the insight, transparency, structure, and support to drive industry leading performance and results from each of our service areas.

If you have any questions regarding the current market or your supply chain post COVID-19, please email us HERE today for a free consultation. We look forward to working with you!


CLN Worldwide www.clnusa.com customerservice@clnusa.com 704.756.6425

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