It’s a simple truth: no business can succeed without a reliable supply chain. Today’s marketplace is more complex and interconnected than ever, providing more supplier options, but also more potential risks. From sustainability initiatives to global instability and more, there’s a lot to keep an eye on. How can you guard against the most significant risks while staying open to the biggest opportunities?
Having the right leadership in place, with the right strategic approach, is critical for any organization! Here are a few of the emerging threats and exciting opportunities that our GESG experts are focused on – and how they could impact you.
Threat: Cybersecurity
There are, simply, more vectors for risks than there used to be. More complex supply chains involve more steps and more parties, opening more opportunities for a single breach to affect countless others in the network. Increased use of cloud-based solutions and internet-enabled devices offer more entry points, and greater digital reliance makes it easier to take down large segments at once. And, of course, cybersecurity attacks themselves are more sophisticated and severe than ever.
How can your team mitigate these risks? Consider a few steps:
- Hiring leaders with a track record of addressing these issues with the seriousness they require.
- Focusing on hiring and promotion leadership who can secure buy-in across functions to form a collaborative security force.
- Establishing a transparent and formal risk management process.
- Identifying critical suppliers and systems, as well as analyzing their potential risk vectors and weaknesses.
Opportunity: Sustainability Shifts
As the world shifts towards preferring more sustainable solutions, there’s an enormous opportunity for supply chain leaders to guide companies into the new era. Depending on how the numbers are calculated, global transportation makes up approximately a fifth of the world’s emissions. As decarbonization efforts ramp up, it creates new opportunities for forms of transportation that are less carbon-polluting and more efficient.
In an interview with Strategy + Business, CN Rail CEO Tracy Robinson noted, “You can reduce emissions by about 75% if you shift from truck to rail. The opportunity, but also the responsibility, is to figure out how we can move more of that truck traffic off the roads and onto this lower-emissions path.”
The challenge, she explains, is growing a rail infrastructure and supply chain that can offer the speed, organization, and consistency that drives customers to choose trucking. Hiring experience, forward-thinking supply chain leaders, like the talent GESG places, can make all the difference and give organizations a major competitive advantage.
Risk: Global Political Uncertainty
The global economic and political situation continues to be somewhat volatile, with ongoing conflicts and unpredictable leadership around the globe. In the SAP 2022 Supply Chain Survey, geopolitical unrest was the top supply chain issue according to business leaders, cited by 58%, and that number remains high today.
Risk-proofing your supply chain requires leadership who will carefully map out and monitor all potential exposures, all throughout the supply chain. Supply chain diversification can help mitigate these risks, as can developing a “playbook” to allow for faster, more agile responses when events do happen. Savvy leaders look for ways to combine high-tech solutions (for connectivity and visibility) with human knowledge and innovation to better guard against (and respond to) the inevitable challenges and disruptions that arise. This way, a single disruption is less likely to have a massive ripple effect.
Opportunity: Prioritizing Resilience
Challenges present opportunities, and meeting today’s risks can have long-term benefits when it drives a more resilient strategy. This is especially true when it comes to hiring supply chain leaders who are strategically positioned to make the necessary changes. Consider the following:
- According to McKinsey, supply chain issues can lead to losses equal to almost 45% of a company’s full-year profits over the course of a decade.
- Less than a third of leaders say their companies are fully prepared for disruptions, and around 25% say their companies are actually underprepared.
And yet, resilience preparations pay off! Researchers from the Harvard Business Review found that having an “early warning system” can prevent serious shortages: one company reduced its parts shortages by 70% in six months, while another reported 40% fewer quality defects within a year.
Hiring CEOs and other top-level leaders with supply chain experience can also have a significant positive impact on building resilience. An HBR study of S&P 500 CEOs found that CEOs who come with a significant supply chain background:
- They are more likely to mention supply chains in annual reports.
- Take a more proactive approach to supply chain challenges and opportunities.
- They are more effective in maintaining profitability, increasing sales, and minimizing costs.
- They are better positioned to detect disruptions early and respond quickly and effectively.
Hiring top leadership with supply chain expertise can give your organization a significant competitive advantage, especially in today’s unpredictable world.
Whether you need support for a single hire or long-term, scalable talent solutions, talk to GESG and learn how our expert approach can provide the tools you need for success!
Give us a call at 330-664-9400 or reach out at [email protected]