Smaller Companies Can Leverage Technology to Increase Resiliency

Smaller Companies Can Leverage Technology

Smaller companies, which may lack the resources to build regional supply chains, can still take steps to increase their resiliency. “The first thing they should do is leverage technology,” Chopra says. “Technology can help them monitor their supply chain more closely, so they can detect disruptions earlier and respond more quickly.” This can be done through the use of sensors, RFID tags, and other tracking technologies.

In addition, companies should look for ways to build flexibility into their supply chains. This can include using multiple suppliers for the same parts, or having suppliers that can quickly switch production from one item to another. “The idea is to have a supply chain that is agile enough to respond to changes in demand,” Chopra says.

Finally, companies should look for ways to reduce their dependence on just-in-time delivery. “The idea is to have some inventory on hand so that you can respond to disruptions more quickly,” Chopra says. “It’s not that you should have a lot of inventory, but you should have enough to get you through a disruption.”

Preparing for the Next Disruption

The COVID-19 pandemic has been a wake-up call for companies of all sizes. “This is a reminder that supply-chain disruptions can happen, and they can be very disruptive,” Chopra says. “Companies need to be prepared for the next disruption.”

For larger companies, this means building regional supply chains and increasing their flexibility. For smaller companies, it means leveraging technology and building flexibility into their supply chains. And for all companies, it means reducing their dependence on just-in-time delivery and having some inventory on hand.

By taking these steps, companies can ensure that they are better prepared for the next disruption—whatever form it may take.