For decades inventory has been the enemy of efficiency in manufacturing.
With just-in-time systems, businesses could rely on globalized supply chains to deliver what they needed when they needed it without the need to hold buffer stocks.
But the disruption of recent years has exposed the vulnerability of those long supply chains, and patchy visibility beyond the first tiers of the chain.
It’s forcing companies to reassess everything from how and where they source components to how much they keep in stock.
To find out how complex manufacturing sectors are navigating this changing landscape, we surveyed 100 risk and supply chain leaders from automotive to medical devices, industrial engineering to shipbuilding.
How do they see the supply chain landscape? How are they building resilience? What are the main challenges and risks they face? And what will the supply chains of the future look like?
The more complex your manufacturing processes and components, the more potential there is for things to go wrong in your supply chain.
Our survey found businesses are worried about a wide range of factors, from shortages and future pandemics to climate, geopolitics, cyber, sustainability and reputational risks.
60% said losses related to the supply chain had been higher or much higher than expected over the last two years.
83% of businesses said they have made at least some improvements in their approach to supply chain management in response to the pandemic.
78% agreed or strongly agreed that a lack of suitable alternative suppliers restricted their ability to implement and effective dual or multi-source strategy.
74% named natural resources as the environmental factor posing the greatest supply chain risk to their business.
Complexity in manufacturing is about more than technology and processes.
It’s also the sheer number of moving parts that all need to be in the right place at the right time to keep production moving.
The lessons of the last few years are pushing many sectors to move from a globalized just-in-time world to a more regional approach with greater buffers built into supply chain systems.
That comes at a price and companies need to work out how far they want to build resilience at what cost to them and their customers.
In managing these challenges, they also need to juggle external factors, from cyber threats to geopolitical instability, climate and sustainability.
Our survey suggests that businesses are working to overcome problems and considering a range of strategies to increase resilience.
But they’re hampered by a lack of appropriate insurance solutions and the data needed to accurately assess and manage their risks.
Working more closely with customers and partners can help companies understand their supply chains better and address these risks.
“Diagnostic mapping and monitoring tools and analytics can help to visualize, quantify and assess risks across the chain and in specific locations.”
Michael Mooney | Sales & Client Management, Ireland
Diagnostic mapping and monitoring tools and analytics can help to visualize, quantify and assess risks across the chain and in specific locations.
WTW has a highly experienced team specialized in supporting global, complex manufacturing organizations. We have the tools and competencies to help clients understand their supply chain risk exposures and produce customized risk treatment solutions.
We can help you to:
Please get in touch to find out how WTW can support your organization.
To learn more, download your free survey report by completing the short form at the top of this page.
