THE LATEST Business Continuity Institute (BCI) report, entitled ‘COVID19: The Future of Supply Chains’, shows the devastating impact the pandemic has had on supply chains, with 73% of organisations encountering ‘some’ or ‘significant’ detrimental effect on the supply side.
At least in part, this was caused by the fact that less than half (49.5%) of businesses had plans in place that sufficiently covered them for the supply chain issues that arose during the first few months of the Coronavirus outbreak.
The report does, however, highlight that many lessons have been learned and that organizations will be taking steps to ensure their supply chains are more robust for the next incident or crisis.
Over half (57.2%) of respondents to the Resilience360-supported report will look to diversify their supplier base post-pandemic. For many organisations, this means reducing their reliance on the Far East (29.9%) and a further 13.1% from China. There will also be a shift towards sourcing goods more locally (66.2%), while others will look at additional stockpiling.
Other areas organisations have highlighted for improvement include due diligence deeper into their supply chains (although this has largely been carried on Tier 1 suppliers, while improvements can be made on Tier 2 suppliers and beyond) and improved documentation encompassing specific pandemic plans that include supply chains.
Rachael Elliott, head of thought leadership at the BCI, commented: “With three out of every four organisations we interviewed stating that their supply chains have been adversely affected by COVID-19, this report serves as a timely overview of the issues organisations have suffered throughout the pandemic. It serves as a benchmark to organisations, but also offers suggestions on measures they could consider implementing into their future supply chain strategies to halt similar issues happening again in the face of a second wave or future global crisis.”
Elliott continued: “While the pandemic continues to wreak havoc with supply chains globally, it has also brought opportunity. Many organisations are already actively investing in new technologies to help with activities such as supply chain mapping, while others have developed cross-functional teams – which they plan to keep post-COVID – to work together to help combat supply chain issues in a more organisationally cohesive way.”
The report looks at the pandemic from two viewpoints: how organisations and their supply chains were prepared for such a global crisis, and what lessons have been learned about how organisations can ensure their supply chains are more robust moving forward.
The document produced by the BCI is based on over 350 respondents from 77 countries and supplemented by the opinions of supply chain experts. Among other areas, the report covers pandemic planning and COVID-19 readiness, supplier management and risk plans and operations management and logistics.
*Download the report at https://www.thebci.org/resource/covid19–the-future-of-supply-chain.html