Amidst New Uncertainty, UK Supply Chain Leaders Look To Increase Supply Chain Resiliency

Innovation Amidst New Uncertainty, UK Supply Chain Leaders Look To Increase Supply Chain Resiliency Richard Howells Brand Contributor SAP BRANDVOICE Storytelling and expertise from marketers | Paid Program Jul 1, 2022, 08:16am EDT | Share to Facebook Share to Twitter Share to Linkedin Uncertainty is the new certainty getty I recently booked a summer trip back home to the UK to visit family that I have not seen in over two and a half years. The flights are more expensive than ever, the car rental price is at an all time high, and don’t forget petrol (or “gas” for my US friends). Don’t get me started on the price of gas! And the standard answer when you ask why? “It’s a supply chain problem!” In fact, according to a recent survey of 200 senior decision makers responsible for logistics / supply chain strategy, it was not surprising to hear that the pandemic has been the main factor causing current supply chain issues in the UK, with 98% of UK businesses agreeing that “factors such as social distancing restrictions, travel restrictions, speed of vaccine distribution and remote working is to blame.

” This was closely followed by the impact of Brexit with 86%. This confirms the Institute for Government findings that labor shortages, Brexit trade barriers, global supply problems and panic buying are all contributing to supply chain disruptions in the UK. And they don’t see a quick fix on the horizon, with 59% thinking their supply chain needs a lot/significant improvement, and almost a quarter (23%) of businesses anticipate their supply chain issues will still be a problem in the Summer of 2023.

From “Just-in-time” To “Just-In-Case” Supply Chains For decades, companies have optimized supply chains to reduce costs. This has led to a global supply chain, with suppliers, contract manufacturers, and in house manufacturing located in “low cost” regions, often an ocean away from the actual demand. Inventory has also been stripped out of the supply chain wherever possible as “just-in-time” methodologies have been implemented, again, to reduce carrying costs.

MORE FROM FORBES SAP BrandVoice: Disruption Denied: How Next-Generation Logistics Create A Resilient Supply Chain By SAP Guest Unfortunately, the global pandemic, and the ripple effect of Brexit has exposed the inherent risks in todays “just-in-time” supply chains. In an effort to balance cost and risk, a whopping 84% of UK businesses now think they should move on from a ‘just in time’ supply chain model to a ‘just in case’ model to overcome potential supply chain crises moving forward. They say that that “due to resource depletion, and climate crisis, and much more – businesses will be faced with broader and more frequent global shocks over the next decade and beyond”.

This is why supply chain management is a topic of discussion in governmental briefing rooms, corporate boardrooms, and even family dining rooms. MORE FROM FORBES SAP BrandVoice: Why Resiliency Is The New Efficiency – And What You Can Do About It By Richard Howells Uncertainty is the new certainty. Interruptions are regularly caused through a lack of transparency across every stage of the supply chain.

When deciding between a ‘just in time’ or ‘just in case’ supply chain model, or, more realistically a hybrid of the two for greater supply chain resiliency , collaboration and transparency are key. This spans across across all departments – procurement, logistics, manufacturing, planning, sales, and marketing – as well as with key partners to balance the higher costs of holding goods and where to hold them, versus the very real danger of empty shelves and dissatisfied and lost customers. And when I board the plane in a few days, my luggage will be crammed with the vital necessities that I need for a 2-week trip – Just in case.

To learn more download the full research findings , and to discover why logistics and supply chain professionals now rate resilience as their top priority – and what they plan to do about it, check out a recent study Revisiting Supply Chain Resilience . Follow me on Twitter . Richard Howells Editorial Standards Print Reprints & Permissions.