A recent survey conducted by LeanDNA in conjunction with Wakefield Research has exposed significant inefficiencies within the supply chain sector, with revealing figures painting the picture of a highly manual and reactionary industry plagued by concerns about the next big disruption. Notably, the results of the Supply Chain Management Readiness Survey disclose that supply chain professionals are devoting nearly 14 hours per week, which equates to almost two full workdays, manually tracking data.
Despite a clear intention amongst supply chain executives to bolster investments into proactive supply chain management, with 92 percent signalling such an ambition, it appears alarming that over three-fourths (76%) lack a present predictive view of supply and demand. According to Richard Lebovitz, CEO of LeanDNA, this represents a "significant loss in productivity" and limits the ability to make effective day-to-day decisions. Moreover, it raises serious doubts about these leaders' capabilities to get their supply chains geared up for future disruptions.
The deficiency of predictive data has resulted in executives resorting to instinctive decision making, with 92% acknowledging that they make gut decisions in the absence of predictive guidance in their reports. The survey notes mounting anxieties amongst supply chain leaders around external disruptions that are outside their control. With 56% citing supply shortages as the main worry, others are equally concerned about public health crises (52%), natural disasters (50%), government regulations (49%), cyber-attacks (49%), and geopolitical conflicts (45%).
As the world adapts to the aftermath of the COVID-19 pandemic and braces for future disruptions, executives foresee potential workforce implications brought about by further supply chain disruptions, potentially causing layoffs or other labour impacts (47%), and reduced productivity (45%). Additionally, 33% of supply chain executives worry that the next disruption could result in revenue losses, posing dilemmas between stocking up or risking a disruption. This predicament is exacerbated by the pressure 96% of them face to balance preparedness for a major disruption with avoiding excess inventory.
Reflecting on the potential fallout of another supply chain disruption, 45% of the surveyed leaders expressed fears about damage to their organisation's reputation, while 36% worry about damaged supplier relationships. Recognising the barriers to the implementation of real-time data for supply chain management, the report identified the absence of supporting technologies (44%) and inadequate staff skills and training (55%) as major obstacles. Furthermore, 48% found it difficult to change their ingrained systems, while 26% saw the risk of disruption during tech upgrade as a deterrent.
A significant 82% of leaders agree that real-time data that does not provide actionable insights for decision-making is a waste of time and energy. However, less than a quarter (24%) enjoy the benefits of a predictive view of supply and demand insight to plan their actions. This places such companies in a favourable position when it comes to making choices based on the insights.
In terms of actions taken to brace for future disruptions, improvements have been made to processes or tech stacks in 86% of the surveyed organisations. Additionally, 41% of the executives said they had diversified their supply base, 39% reported identifying new or better vendors, 36% reskilled their workforce, and 32% partnered with third-party logistics experts.
Rounding off, the survey results highlight a clear opportunity for businesses to embrace advanced analytics along with their increased investments in preparedness. With LeanDNA in the vanguard, empowering manufacturers to prioritise and collaborate to resolve critical material shortages and excesses, the user can improve on-time delivery and working capital levels through inventory visibility, recommended actions, and real-time collaboration with suppliers.