Leveraging Integration to Outsmart Disruptions and Create an Agile Supply Chain

As part of Solutions Review’s Contributed Content Series—a collection of contributed articles written by our enterprise tech thought leader community—Mahesh Rajasekharan, CEO and President at Cleo, explains how leveraging integrations can help companies create an agile supply chain that’s less affected by disruptions.

The global supply chain has experienced many challenges over the past few years. From a turbulent economy and geopolitical challenges to labor strikes among port and logistics workers, challenges in the industry easily cause disruptions throughout the supply chain. In a recent Gartner survey, 76 percent of supply chain executives say the number of disruptions has increased compared to before the pandemic. 

Impacts of Supply Chain Disruption 

The supply chain landscape is becoming increasingly complex and interconnected, making it exceedingly vulnerable to shocks and disruptions. As businesses increasingly rely on broader networks of suppliers and partners around the world, it can also be difficult to identify and mitigate risks and delays. One of the biggest challenges in mitigating supply chain disruptions is that they are often unpredictable, such as a natural disaster or geopolitical event that can occur without warning.  

Interruptions in business continuity because of supply chain issues often result in shortages and delays that have had lasting impacts on businesses of all sizes and industries. A recent survey found that the average organization suffers four supply chain disruptions annually, which require significant mitigating action with an estimated average $22 million cost per disruption—a total of $88 million annually. Lost or delayed sales can diminish customer satisfaction and company reputation. If consumers cannot access the products and services they get from their usual brand or supplier, they will likely find the products and services elsewhere. Therefore, consumers may continue using the new brand or supplier moving forward, even after its supply chain is running normally again.  

Working across multiple systems can also create problems, as the complications of disparate technologies prevent businesses from having critical visibility across their supply chains. According to another recent survey of supply chain leaders, 74 percent of executives noted that their business was disrupted for more than a week due to partner issues, with 38 percent lasting from 11 to 20 days. Of those partner-related disruptions, half (50 percent) were caused by supply chain issues, and 31 percent were caused by technology issues. 

Striving for Agile Supply Chains 

Shifting from a reactive response to proactively striving for agility in the supply chain is critical for businesses to anticipate and respond to disruptions quickly, as well as diminish losses when these disruptions hit. Agility helps companies improve overall business continuity and allows them to quickly adapt their strategies and processes to quickly adjust to supply chain setbacks, as well as meet evolving supply chain market expectations and customer demands. Technology investments can help companies stay nimble. In fact, a recent report of global supply chain executives found that half (49 percent) of senior executives surveyed noted making proactive investments in integration technology has increased their company’s agility, which enabled them to gain $1 million or more in additional revenue in 2022. 

Agility and Visibility through Integration 

In the face of uncontrollable disruptions, business leaders want greater control of supply chain processes, both inside their companies and across their ecosystems of partners, suppliers, and customers. Achieving such control requires visibility across enterprise and supply chain operations. Connecting systems between supply chain partners provides end-to-end visibility by enabling the constant flow of real-time information between interested parties—ensuring that all participants are operating on the latest updates and communicating strategy changes with one another.  

Achieving greater visibility becomes even more critical as companies make efforts to mitigate supply chain disruption by opening new revenue streams. As more business lines and marketplaces are added to a company’s portfolio, there are more operations to monitor and adjust as needed. Automating the integration of new marketplaces and lines of business reduces the manual effort required to monitor and adjust new business operations based on new information. 

Business leaders also want to enable automation, which increases agility, efficiency, and scalability without increasing costs. Manual processes prevent companies from operating at peak efficiency and generally cost more than automation in the long run. Integrating systems across an enterprise’s IT landscape and supply chain partners allows automation-driving data to be shared between stakeholders. Thus, automation capabilities are improved and more robust, as information that drives automation can be collected from various systems for analysis. 

The Future of Supply Chain Disruptions 

In today’s complex and interconnected global supply chain landscape, disruptions are inevitable. However, by integrating their systems and proactively achieving agility across the supply chain, businesses can make fast, informed decisions with full end-to-end visibility across enterprise and supply chain operations. This allows them to gain a competitive advantage by anticipating and mitigating disruptions, meeting the changing needs of their customers, improving efficiency, and reducing costs.