Risk is an inherent part of the supply chain process. From weather to inventory, routes to international laws, there is much that can go wrong in the supply chain process. Thankfully, at TOC Logistics, our staff is extensively trained to understand the potential risks and plan accordingly, thus mitigating the risk involved in providing supply chain solutions. There are many ways supply chain managers can mitigate risk. They can use innovative software and big data solutions to forecast potential inventory, weather, routing, and compliance problems. Transportation can be customized to be ready to circumvent every bump in the road. Formal processes can be set in place and implemented to decrease the overall risk and add transparency to the supply chain. Online portals can be used to improve communication between the logistics organization and the client, allowing for no stone to be left unturned. While risk is an inherent part of the supply chain, there is no need for unnecessary risk to be a part of the process.
The first part of mitigating risk rests in developing a process and creating visibility between each part of the supply chain. This means that inventory, transportation, and forecasting all correspond with each other and allow for the supply chain manager to anticipate different problems. This can be done with inventory management software, advanced analytics and big data, capacity management, and other essential technologies that allow for logistics organizations to anticipate problems at the warehouse before they begin. By anticipating these problems, it becomes possible for the supply chain manager to mitigate risk by coming up with alternative solutions should a forecasted problem arise. From there, there are processes and strategies in place to circumvent these problems from coming into fruition.
Forecasting also allows for the opportunity to predict potential problems in the transportation process. Transparency allows for supply chain managers to mitigate potential mechanical, routing, and compliance issues that could otherwise create financial strain or cause unnecessary shipping time that could have otherwise been avoided. By being aware of the potential disruptions and risks, you can create additional strategies and model a response that is ready to be implemented at a moment’s notice.
These risk mitigation strategies help to increase the efficiency and transparency of the supply chain, saving the client money and mitigating the overall risk throughout the process.
Other ways to mitigate unnecessary risk involve thorough contracts that specifically state all expectations between all parties involved. By putting expectations in writing, the supply chain manager is able to protect their client, work efficiently, and communicate clear expectations to all external parties that may be involved in the process of achieving the client’s goals. Complete contracts can bridge potential gaps and improve efficiency and transparency. In addition to clear contracts, being fully aware of all necessary compliances and laws is essential to mitigate risk. It is important to work with a logistics organization that is fully vested in the industry and is well-educated on international and national laws and compliances. There is significant unnecessary risk with not being up-to- date on all legalities involved with the supply chain process.
At TOC Logistics, we pride ourselves on our proven team of supply chain managers and specialists. We believe that any risk is unnecessary risk, which is why we strive for complete transparency and our unique approach. Any company can tell you they’re efficient, thorough, trustworthy and committed to your best interest, but it’s another thing to prove it. Contact us today to see how we can meet your supply chain goals.