MIT Sloan: Improving resilience within automated supply chain will prevent disruption

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Dive Brief:

  • Enhanced digital technology is equipping companies to leverage big data to help recognize supply chain risks and generate early disruption warning signals far faster and more accurately than ever before, MIT Sloan reported last week.
  • However, effective response times have not kept pace, due to a lag in development capability. Despite this gap, a recent survey of 30 various companies by The Center for Global Enterprise (CGE) found that 88% have incorporated elements of the digital supply chain into their business model.
  • A variety of strategies already exist to help improve resilience, including supplier diversification, safety stock buffers, and enhanced transportation capacity. While these efforts will continue to provide value, the need to increase cyber resilience to speed response time must rely on improved automation and intelligent software.

Dive Insight:

When attempting to keep pace with technology, supply chain managers must work hand in hand with the head of their IT department. Addressing both the wealth of new data and the need to choose what to automate first is a good way to begin coordinating the supply chain.

Harnessing data to create stronger risk management alerts is ideal. Once established, as MIT Sloan offers as an example, such alerts can prompt a quicker response to disruptions, such as engaging  IoT tech to monitor the condition of perishable items. If affected, the supply chain manager can act immediately to decrease wait time for a replacement by launching a fresh shipment.

In addition, a high-functioning alert system can communicate independently with government oversight agencies such as  customs departments responsible for maintaining health standards. As sensitive supply chains are often viewed as vulnerable by regulators, slowdowns caused by unnecessary inspections can perhaps be reduced or eliminated. 

Ideally, response mechanisms within the supply chain will soon be synchronized. Until that time, however, supply chain managers who first improve their alert systems will likely benefit most.

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Filed Under: Technology
Top image credit: Pixabay

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