Reference no: EM131784752
Supply chain management is full of challenges that can result in higher costs, wasted materials and production errors.
The first challenge is safety and quality products. As quality standards rise, it is crucial to produce safe and high-quality products. Companies are working harder than ever to avoid damaging recalls that can hurt the bottom line. High quality is achieved by starting at the very beginning. By selecting the correct raw materials to use for each application as well as the correct production method, quality crisis can be avoided.
The second challenge is new technology. Advancing technology is making its way into the supply chain, forcing businesses to constantly change systems. The challenge is keeping supply chain managers and procurement professionals up to date and trained with all these new advancements. It will take some time for a business to discover the right process that works for them. Some solutions may include putting together a team in charge of locating the latest supply chain innovations and coming up with a plan to train the rest of the staff. Others could be outsourced training programs funded by the organization whose employees will be taking part. Continuous training will be vital in order to remain effective in this transforming industry.
Nowadays one of the big challenges is cyber risk. A common trend in nearly every industry is digitization. From manufacturing to the supply chain, digital technologies continue to transform how business is conducted. Innovative new systems are creating solutions to problems that have always plagued the industry. However, as the supply chain becomes more connected, risks begin to present themselves. The challenge is ensuring the supply chain remains resistant to cyber attacks. The solution would be to ensure all new systems are properly secured. Largely, this is an inherent issue with new connected systems as cyber security is often an afterthought. There are however ways for a supply chain to improve their resistance to these cyber criminals. Threats can come from everywhere, an email, an attachment or even public wifi. It will be incredibly important to understand what kind of cyber risks are out there in order to keep precious data private. Education and staff awareness will be essential in protecting a supply chain’s operations and private data.
According to Harvard Business Review, the impact of a breach incident spares no office, or officer. No corporate reputation is safe from the distrust a company is tarnished with when it’s compelled by regulatory requirement to publish breach-related information. The average cost per cyber incident continues to rise, and even with greater awareness, the frequency of incidents is also rising. When working to identify and strengthen the vulnerable “surfaces” of their networks and information-processing systems, many organizations fail to scrutinize the cyber risks that their suppliers or vendors can introduce (negligently or unintentionally) – including vulnerabilities stemming from their electronic security systems. Therefore, cybersecurity investment and preparedness outside of their walls should be considered.