Supply chain disruptions will require workarounds and effective internal communication

Supply chain disruptions will require workarounds and effective internal communication

In the world of business, the last thing any owner, CEO or stakeholder wants to hear is “disruption”.

Effective supply chains that run like a well-oiled machine are integral to any business’s success. Consumers today have gotten accustomed to products always being available and accessible. When there’s a disruption in this availability and accessibility, the relationship between consumers and businesses gets disrupted too.

In a report published by the Institute of Supply Management, nearly 75% of businesses said their supply chain was severely disrupted due to COVID. If you’ve also been hit with a supply chain disruption, then effective workarounds and internal communication especially, are two of the keys to getting back on track.

Getting back on track from supply chain disruptions 

Internal communication

Crisis communications is one of the keys to managing affairs in the middle of a supply chain disruption and this means being prepared to communicate the ‘current scenario’ to all employees, customers, stakeholders, suppliers, media, analysts, and the general community at large.

When you do this, everyone, and especially your customers, will appreciate the fact that you honestly reported supply chain issues, which means you will be able to maintain the same level of trust you’ve worked so hard to build.

An important thing to remember when communicating this to all stakeholders is to speak with one voice. Designate a single person who will share the most accurate and up-to-date information about the supply chain crises and what your company is doing to mitigate it. It’s very important to not blame anything or anyone (such as coronavirus or a specific supplier), sugar-coat things or try to spin it in some way or the other. Be very honest and tell your audience exactly what you’re going to do about it, and how long it may be before things return to normal.

Always be transparent with your customers as it is essential to getting through these tough times. When you’re upfront about the supply chain issues you are facing, your customer base is far more likely to cut you some slack and stick with you through thick and thin.

Come up with workarounds – fast

Companies must plan ahead in regard to how they might manage customer demand during a supply chain disruption. Here are some ideas:

  • Product triage (allocation) – Let’s say multiple products utilise the same component, which products should get the component? In this case, you would want to consider financial contributions, company needs, customer importance, fairness, or which customers/stakeholders could go out of business. Always plan this ahead of time, and not in the middle of a supply chain crisis.
  • Demand shipping – If some of your products are in short supply and there is reasonably sufficient stock of other similar products, you might raise the price of the less in-demand products and lower the price of others, to shift customer demand a little, helping you cope with the crisis.
  • Diversify suppliers – When you have backup suppliers in multiple locations, it can mitigate some of the problems that come with geographical disruptions.

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ENDS