IoT & Supply ChainBusiness Network

Future-proofing your supply chain

How supply chain managers can prepare for the next disruption

By now we are all aware of the effects of climate change on global supply chains, and we are seeing real-time ramifications around the world. According to McKinsey, “The probability of a hurricane of sufficient intensity to disrupt semiconductor supply chains may grow two to four times by 2040.”  To hear CNBC tell it, “floods in China and Europe, wildfires in the Western US, and drought in South America mean disruptions of everything from lumber to chocolate to sushi rice.” Even physically getting to work (for those who can go back to the office) is being disrupted by climate change. In fact, CNBC notes that a recent report from the United Nations Development program indicates that workplace disruptions caused by climate change could lead to more than $2 trillion in productivity losses by 2030.

We can even consider the effects of COVID-19, one of the most disruptive black swan events to disrupt global supply chains. And while COVID-19 isn’t linked to climate change, report after report can be found which shows that other infectious diseases are more likely to proliferate and spread as the planet gets warmer.

And the experts say these trends will only get worse. According to the BBC, based on the most recent International Panel on Climate Change (IPCC) report from the UN, “even if we get a handle on emissions and keep temperatures around 1.5C by 2100, the waters will continue to rise long into the future.” Valerie Masson-Delmotte, co-chair of the IPCC working group which prepared the report, says: “With gradual sea-level rise, those extreme sea-level events that have occurred in the past, just once per century, will occur more and more frequently in the future.”

These events serve as a wake-up call to what should now be considered one of the most important roles in the Industry 4.0 world: the supply chain manager.

Without a chain of supplies, much of our global economy grinds to a halt. If the past 18 months have demonstrated anything, it’s the importance of ensuring we can get the goods and materials we need from point A to point Z. This could include anything from the nuts and bolts that hold together our rockets to the solar panels that power our cities, not to mention just getting our food from where it’s grown to where we need it (but that’s an entirely other conversation). We will still very much rely on stuff to live.

Enter the supply chain manager, the person responsible for developing the most resilient, secure, future-proof supply chains possible and ensuring that stuff gets made and sent to where it needs to go. That can be accomplished in myriad ways, from automated trading partner management – so if one resource hub goes down an AI can automatically reroute production to another without missing a beat –  to IoT enabled tracking on every piece of whatever it is you make for an incredibly detailed “bird’s eye view” of where all your stuff is, where it should be, how it’s getting there, and when. The more visibility and transparency we can build into our supply chains, the more likely we are to be able to react – or even in many cases preempt – disruptions.

By developing resilient, secure and future-proof supply chains, the supply chain manager can help ensure we’re all better prepared for when the next disruption occurs.

Looking for a way to future-proof your supply chain today? Visit our website to learn more about OpenText™ Business Network solutions.

Author: Chris Moscardi, Senior Content Marketing Strategist

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