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The Supply Chain Gridlock: Partner With Your Suppliers Now to Mitigate Risks for the Future

Gartner 23 Nov 2021 09:00

Component shortages, raw material inflation, logistics capacity shortage and freight cost surge. … This is the world we are living in now.

That’s what makes up the so-called “supply chain gridlock.” It is impacting different industries in different magnitudes. But the common factor here is the fact that these supply constraints are straining manufacturers’ ability to maintain service levels across the breadth of often-complex portfolios. Not only that, but this instability of managing the supply chain inputs is also creating volatility in production and delivery schedules that grows in impact through each level of the supply chain.

The reality of the “supply chain gridlock” puts pressure on supply chain leaders to look for different strategies again and again and to redefine alternative approaches to manage their supply volatility. Many leading and mature organizations have focused their current efforts on building strong and structured collaborative relationships with their suppliers and logistics service providers.

Strategic suppliers are the ones who impose a high-risk exposure on volume/revenue, are complex to replace and have capabilities that can be leveraged to create competitive advantage.

4. Integrate the outputs of the CPFR process into your S&OP and S&OE processes.

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