Building a Resilient Supply Chain: Strategies and Best Practices


Improving supply chain resiliency is a requirement for any shipper looking to create a competitive advantage. Companies with resilient supply chains are more likely to have goods available when needed and are better able to control costs and remain committed to sustainability initiatives, even when disruptions strike.

Brief

Resilience has been a strategic priority for many shippers as they apply lessons learned from global disruptions caused by the COVID-19 pandemic. Resiliency continues to be in the spotlight as global conflicts, climate impacts, labor strikes, uncertainty in trade policy, and many other factors continue to challenge supply chains.

This guide focuses on some key investments and focus areas that shippers should consider to improve supply chain resiliency.

You will learn:



Why resiliency is a top priority

Disruptions are inherent in supply chains, so why are shippers prioritizing resiliency now?

Increased globalization and complexity: Global commerce is rapidly adding complexity and magnifies the impact of disruptions. Evolving regulations, climate events, and geopolitical tensions, especially on lean, global supply chains.

Sustainability commitments: : Supply chains are under more pressure than ever to reduce their environmental impact. Constant disruptions can steer supply chains off course from their sustainability goals as leaders devote more attention and resources to mitigation. According to Gartner research, nearly two-thirds of companies regularly deprioritize sustainability for resilience.1

Customer experience: Supply chain execution, or lack thereof, plays a key role in the customer experience. Customers now depend on greater speed, visibility, quality, and consistency. A resilient supply chain helps companies be responsive to customer needs and maintain high service levels, while also keeping net working capital and costs under control.

Exponential growth of data: Today there is more data across supply chains than ever before. By capturing this information in an efficient and accurate way, shippers can build predictive models and make informed decisions to improve resiliency throughout the supply chain.


How to build a more resilient supply chain

To enhance resiliency, companies are implementing new sourcing strategies, regionalizing supply networks, digitizing supply chains, and more. Before the next disruption strikes, there are steps you can take to protect your bottom line and become more agile and responsive. Start by prioritizing these key areas:

1. Invest in technology and digital capabilities

Centralized supply chain visibility, automation, and predictive analytics on a global scale are crucial to achieving resiliency. No supply chain is immune to disruptions, but the ability to quickly identify, plan, and react to changes lessens the impact and leads to faster recovery.

To improve resiliency and agility, shippers should specifically look for partners with the TMS technology and expertise that offer:

  • Real-time visibility
    • Visualize your global supply chain, including all inventory at rest or in motion, across all modes and regions
    • Proactively track, monitor, and react to disruptions before they occur through integrations from external data sources like weather, traffic, and current events
  • Gen-AI, predictive analytics, and machine learning
    • Turn data from various sources into business intelligence that reveals actionable insights, improves decision-making, and automates manual tasks so you can move faster and smarter
    • Spot shipments that are trending toward committed delivery dates and recognize which ones are at risk for late delivery
  • Risk analysis
    • Connect historical disaster effects with supply chain data to identify and analyze risk metrics for site locations, routes, suppliers, and loads
    • Reduce over reliance on the carriers and ports with the highest risk profiles to minimize service level disruptions
  • Control Tower® connectivity
    • Streamline communication and connectivity across logistics providers, and improve performance through control tower networks, connected by a single technology platform
  • Internet of Things (IoT) integrations
    • Take monitoring and tracking to the next level with IoT devices that can measure and monitor elements in your shipments like shock, light, and temperature
    • Monitor and be alerted to potential spoilage, damages, or tampering, with the goal of mitigating and recovering from the issue immediately

2. Update your risk management plans

An effective risk management plan should include:

Supplier awareness: Identify the relative strength of your core suppliers. Keep your senior management aware of potential risks, since these vulnerabilities can have an impact on decisions regarding where to source, manufacture, and market products. Most supply chain disruptions occur upstream, so it’s important to gain visibility to your suppliers’ suppliers and where components are coming from. Mapping your suppliers and their key suppliers is a powerful activity to bottlenecks and points of failure risks.

Scenario and contingency planning: Prepare for future disruptions with scenario planning activities that simulate network disruptions for different threat levels and cost analysis for expediting and freight diversions. From there you can develop contingency plans that include back up suppliers for key commodities, proactive reviews and communications with teams to ensure all parties understand their areas of accountability.

Scorecards: Evaluate both in-house and contracted supply chain providers through a scorecard. This will help everyone understand which capabilities and responsibilities are most critical. Scorecards should balance risk mitigation, contract, and response capabilities.

Quarterly reviews: Suppliers and in-house operations should be reviewed quarterly for their handling of incidents to promote proactive risk monitoring. Data collected before and during these reviews will likely contribute to the strengthening of future risk management planning.

Digital twin mapping: A visual map of all transportation routes, with identified risks called out as “hot spots,” promotes a greater understanding and assessment of risk. By monitoring weather events, political unrest, and other elements of risk and visually displaying them on a global map, shippers can develop highly effective prevention and response plans.


3. Secure global talent

While technology investments remain a top priority, people will always be an important part of supply chains. Technology has the greatest value when the people operating it understand all its intricate details and systems.

The shortage of supply chain talent has been a key issue within the industry for some time, and it can be challenging for companies to find and retain these in-demand experts. Choose a partner that not only offers technology that connects data across your supply chain, but has talent with deep domain expertise in solving for challenges each and every day as an extension of your team. You can tap into the technical and strategic knowledge required to unlock the true potential of the TMS and maintain a reliable, steady team of resources that translate into greater insights, improved service, and savings.


Resiliency vs. lean: How to find the right balance

Supply chains today must balance being global, sustainable, and agile—while reducing costs. But when it comes to supply chain efficiencies, how lean is too lean?

As well-known brands have suffered through very public service disruptions in recent years, that question has gained renewed attention in corporate boardrooms. Complete redundancy is cost-prohibitive, but some redundant stock, systems, and resources can help avoid the waste of system breakdown if a disaster occurs, even in a highly efficient supply chain.

5 barriers to resilient supply chains3:

  1. Product and portfolio complexity  
  2. Organizational silos and contrasting metrics across different functions
  3. Investment costs (e.g., qualifying alternate suppliers, duplicate tooling) 
  4. Balancing trade-offs between cost-efficiency and resilience/risk mitigation 
  5. Lack of advanced digital technologies for increased visibility and coordination

Here are ways that C.H. Robinson Managed Solutions™ can help address competing priorities of achieving lean cost savings, while also delivering high customer satisfaction through supply chain resiliency.

Cost management: Savings can be achieved through optimizations and automation around procurement, audit/pay accuracy, fine reduction, and more. Power users maximize the benefits of the technology, reducing the need to add and train headcount.

Visibility and business intelligence: A panoramic view of your entire supply chain with details for every shipment worldwide brings new agility, accuracy, and insight to critical transportation and logistics decisions. Platforms that have integration with real-time data feeds—including weather, traffic, socio-economic disruptions, and other factors—help optimize decision modeling, risk analysis, and other critical supply chain processes.

Demand forecast planning: Better understand demand patterns by seeing a clearer picture of freight flows at local, regional, and global levels, leading to improved workforce planning at your sites and collaborative shipment planning with material vendors. This can also make it possible to respond immediately to marketplace changes or disruptions—including sudden spikes in demand.


Invest in resiliency today for a competitive advantage tomorrow 

As your supply chain grows increasingly complex, you can unlock seamless access to configurable TMS, 3PL, and 4PL solutions all from one provider with C.H. Robinson Managed Solutions™. By bringing together our unmatched expertise, cutting-edge TMS technology, and unrivaled scale, you can mitigate risks, minimize costs, and improve resiliency. Connect with an expert to get started.

Footnotes

  1. Gartner Research, “Supply Chain Executive Report: Balancing Sustainability and Resilience for Our Climate Future,” July 26, 2023.
  2. Gartner Research, “Future of Supply Chain: Crisis Shapes the Profession,” December 2020.