“How can you prepare for supply chain disruptions such as those we are facing today?” That’s a question top of mind for many of us in today's business climate. The answer lies in supply chain transparency to mitigate risk and identify areas for improvement. Read more to learn how smart supply chain technologies can decrease the affect of disruption, drive business with data, and ensure you've got the right suppliers.
Consequences of supply chain disruption and lack of visibility
Pinpointing the precise consequences or effects of a global situation such as a pandemic is hard to do, but based on past supply chain disruptions such as natural disasters, heightened political climates, and cyber-attacks, there are a few things organisations can expect:
1. Supply shortages: Materials coming out of the impacted region will be limited as goods are routed differently or perhaps production even halted completely.
2. Labor irregularities: In terms of production, white- and blue-collar labor will be limited, at best, as work restrictions and quarantines take precedence.
3. Supply network limitations: Given the logistics of global business, even if materials are available, the hubs and supply networks that distribute the goods may be incapable of transport and alternative routes difficult to come by.
4. Consumer changes: People may start buying differently. As if we didn’t already exist in a highly digital retail world, with a highly contagious virus rampant, more people will be driven to purchase online instead of at a brick-and-mortar shop to keep safe.
60% of business execs believe poor visibility leads to supply chain risk
In order for your business to stay afloat amidst supply chain disruptions, it’s important to have a properly managed supply chain and full visibility into your supply chain processes.
Supply chain visibility is all about transparency—knowing where goods are at any given time, tracking movement, delivery, and thoroughly understanding who you’re doing business with. At Basware, we call this “visible commerce.” Visible commerce is the complete transparency into all the flows of money, goods, and services around the world. This refers not only to the transactional transparency of things like buying, selling and paying transactions, but also much more holistic transparency into who (not what) is underneath all those transactions, what they stand for, and why we should care.
Our recent study with Harvard Business Review Analytic Services (HBRAS) found that businesses worldwide lack transparency in their supply chains. 60% of the 800 business leaders surveyed warn that poor visibility of who they do business with is a significant source of risk. And as many as 24% admit that they fail to effectively evaluate supplier business practices.
Our survey with HBRAS also revealed that 60% of respondents warn that poor visibility of who they do business with is a significant source of risk. According to the survey, the biggest hurdles when it comes to greater transparency were determined to be the following:
Klaus Andersen, Chief Executive at Basware, says, “This report finds that visibility of the flow of money, goods, and services is a defining characteristic of successful businesses. This means taking responsibility for not only the quality of goods and services, but also the manner in which they are produced.”
Smart technologies for a smarter supply chain
In order to achieve this elite level of supply chain visibility, companies need the right technology—smart technologies paired with smart solutions.
With the right automated tools built specifically for supply chain visibility, your organisation can achieve:
1. Less disruptions: What if you could prepare for supply chain disruptions before they happened? You can with supply chain visibility. Operating a supply chain with a strong foundation on data analysis and open lines of communication can decrease supply chain bottlenecks and even avoid disruptions entirely.
2. Drive business with data: Manually updating supplier information leads to obsolete data, potential risks, and wasted time. But with the right automated technology, all that changes. For instance, Basware solutions deliver 100% visibility into your entire supply chain, meaning you reap the benefits of rich and complete supply chain data. Processing this data through Basware empowers you with the insights you need to make smart, data-based decisions that will lead to supply chain excellence.
3. Get the right suppliers: Your suppliers are an extension of your brand. So, it’s important to ensure you’re doing business with the right suppliers who align with you ethically, meet your price requirements, offer the right experience, have the capacity to meet your orders, and are financially stable. Having the right supply chain technology can guarantee your suppliers check all those boxes.
Basware Purchase-to-Pay (P2P) enables buyers to handle supplier master data using a single supplier information management process—Basware Vendor Manager. In it, buyers can move the supplier information management process to the suppliers themselves while also using an external data service to continuously improve the supplier master data. Using Dun & Bradstreet and Mastercard Track Trade Directory, supplier data is further enriched and therefore organisations can adopt an “always-on” approach to supply risk management. Meaning whatever your supply chain throws at you, you’ll be prepared.
How can visible commerce benefit you?
If you’re interested in hearing more about how visible commerce and supply chain transparency can positively benefit your organisation, download our recent report “Using Transparency to Enhance Reputation and Manage Business Risk.”