The carrier is the bearer of the
package – in terms of providing it security and care. Regardless of
circumstances.
Everyday is not Sunday. This is
especially true for logistics and supply chain management. Rain or
shine – they have to make their deliveries on time. Be it a storm
or quake, supply chains and logistics have to guard the packages
right from the time they lay their hands on it till the time the
customer has signed for the delivery.
Supply chains have been burning the
midnight oil trying to optimise their facilities by off-shoring cost
purposes and maintaining only required inventory for immediate
delivery.
In 2011, when Japan was struck with the
devastating Tsunami, supply chains were in a tangle.
Supply chains hold this industrious
world together. The risks in supply chains, its ecosystem of
inventory management – everything is quantifiable. It is imperative
that supply chains make a note of the behaviour of their suppliers
are, the frequency of machine breakdowns, and how accurate their
predictions are – when it comes to forecasting demand. When we take
the Japan’s earthquake scenario in 2011, the suppliers who were not
directly in the line of sight from the impact of the earthquake,
still took a hit as it was difficult for them to procure raw
material, ship completed goods amid other shipping concerns.
With a proper supply chain inventory
model some of these risks can be negotiated with. It is also seen
that the risks of managing a supply chain are drastically kept at a
low, when it is arranged and taken care of within the internal domain
of the inventory planning system.
The present day Multi-Echelon Inventory
Optimisation (MEIO) possesses the intelligence to manage and
administrate the entire range of supply chain management operations.
From predicting demands, to assessing
incremental streams, to determining revenue factors and service
impact, a MEIO system is able to kiss and tell all.
A well-modulated MEIO can also make
suggestions of alternate suppliers that would increase the margins.
MEIO system will be able to fully
assess the frequent risks, overseeing the see-saw effects,
catastrophic events, supply management risk management capabilities,
and the alternate supply strategies that entail higher probabilities
of reducing risk.
The risk management also constitutes
currency exchange risk. Currency liabilities are always changing and
being updated consistently. Supply chains must understand the
exchange costs and differentials. Because if there is a huge
difference in the currency, the transportation and product costs also
take lead in going north.
With a mix and match of brains and
technology, there are all sorts of possibilities to limit the risks
in supply management. All it takes is homework.
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