New Gartner Report Highlights the Value of Investment in Supply Chain Resilience
A new Gartner report titled "Shockproof Your Supply Chain for the New Age of Disruption" has stated that most Chief Procurement Officers(CPOs) in the last two years have been so consumed with reacting to challenges, that they have forgone the required investment in risk mitigation and forward planning. It's not a head-scratcher as to why though. The level of disruption faced in the last two years is unprecedented.
“The cost of recovery is constantly increasing and CPOs’ focus is misdirected to solving the most immediate and simplest issues, time and again.” - Gartner Report
The speed and frequency of disruptions have meant that devising long-term strategies to build more resilient and efficient supply chains, has been virtually impossible.
To mitigate the risks of supply chain disruption, the report concludes that organizations should “Connect supply chain risk management to business continuity management, and regularly review and test business continuity plans when risk management responses fail. Adopt a practice of exponential investment. This creates an outside-in supply ecosystem that enables organizations to create their own markets and robust demand with innovation. Resilience is not achieved in a silo but requires timely and holistic strategy executions”
The report found that the mean supply chain risk investment increase between 2021 and 2022 was 30%.
“Resilience does not come for free, but if done right it will be the most profitable investment an organization can commit to in the age of disruption, where the unexpected is the new normal.”