Are you wasting two days a week?

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by Emily Atkins

Supply chain professionals spend nearly 14 hours per week – almost two full workdays – manually tracking data.

A survey of 250 supply chain, inventory, and planning executives has revealed these inefficiencies in the supply chain sector.

“In a rapidly evolving market, this inefficiency points to a significant loss in productivity and a barrier to effective day-to-day decision-making, not to mention grave concerns about their ability to prepare for the next major supply chain disruption,” said Richard Lebovitz, CEO of LeanDNA, a supply chain software supplier, and sponsor of the research.

While most supply chain executives plan to increase investments in proactive supply chain management (92 percent), 76 percent do not currently have a predictive view of supply and demand.

The absence of predictive data has companies operating as though they have no data at all. The vast majority of supply chain execs (92 percent) make gut decisions sometimes or more due to a lack of predictive guidance in their reports.

At 56 percent, supply shortages are the most cited concern among executives, but are just one of the many worries mounting in 2024 around potential external disruptions supply chain leaders can’t control. More than half (52 percent) are concerned about public health crises, while nearly as many cite natural disasters (50 percent), government regulations (49 percent), cyber-attacks (49 percent), and geopolitical conflicts (45 percent).

Workforce implications

The confusion and chaos of the COVID-19 pandemic, natural disasters, geopolitical conflicts, and more inform how executives anticipate a disruption affecting their organization in 2024. Executives predict a supply chain disruption could impact their workforce —meaning potential layoffs or other labour impacts (47 percent) and reduced productivity (45 percent).

A third of supply chain executives (33 percent) fear the next disruption will mean revenue loss, but stocking up is also a costly or infeasible option. This explains why 96 percent face pressure to balance preparedness for a major disruption with avoiding excess inventory.

A PR nightmare

Customers and clients may have been understanding of disruptions during 2020, but they won’t be so forgiving this time around – and the consequences could be dire. More than 2 in 5 leaders (45 percent) fear their organization’s reputation would be damaged during a supply chain disruption, signalling that customers and clients won’t tolerate the next breakdown – indeed, 36 percent also fear fractured supplier relationships.

Why they struggle

Barriers to using real-time data for supply chain management include the current tech stack not supporting real-time data (44 percent) and lack of staff skills and training (55 percent). For some, upgrading their tech stack doesn’t seem like an option: 48 percent report their current system is too ingrained, and another 26 percent believe their organization can’t afford the implementation disruption.

More than four in five leaders (82 percent) agree that real-time data that does not provide actionable insights for decision-making is a waste of time and energy. While 82 percent report having some level of a real-time view of supply and demand, only 24 percent have a predictive view, giving those companies a leg up when it comes to being able to take action and make decisions based on the insights.

Prepare for disruptions

Supply chain executives are gearing up for future disruption with 92 percent of supply chain executives planning to ramp up investments in preparedness strategies. 87 percent are focused on resilience as a high priority, including 41 percent who put it at the top of their list.

An impressive 86 percent of supply chain leaders report their organizations have already made major changes to their processes or tech stack to improve preparedness for the next major supply chain disruptions. Over one-third (33 percent) have gone through a complete overhaul. This includes 41 percent that diversified their supply base, 39 percent that identified new or better vendors, 36 percent that re-trained their workforce, and 32 percent that partnered with third-party logistics experts.

Supply chain executives are putting tech in place to support their people. More than a third (37 percent) have deployed digital twin and other simulation technologies and more than a quarter (26 percent) have added on to enterprise resource planning (ERP) software for more functionality.

Perhaps most importantly, leaders want to be able to see more clearly what they have now, and what could be on the horizon. More than two in five (41 percent) have increased supply chain visibility to prepare for the next major disruption. With real-time data that could inform their business decisions, supply chain executives say they could improve logistics and inventory management (47 percent), identify changes in demand (45 percent), and enhance collaboration (44 percent).