Address and Improve Supply Chain Resilience With Technology

Amid ongoing supply chain shortages, learn from Tony Harris about where companies can benefit from supply chain resilience and how tech can enable it.

September 29, 2022

Amid ongoing supply chain shortages and market volatility, business leaders should work to create supply chain resilience. Here, Tony Harris, SVP and head of marketing and solutions, SAP Business Network, discusses a few areas where companies can benefit from greater supply chain resilience and how technology can enable it.

Since the onset of the pandemic, supply chains have faced challenges from labor shortages to product delays. This has shaped everyone’s demands and expectations. In fact, in a recent SAP surveyOpens a new window , 74% of consumers said they believe shortages will continue to dominate the conversation.

With many consumers viewing supply chain challenges as part of everyday life, it is vital that leaders of organizations serving both businesses and consumers work to create supply chain resilience. Resilience is key to limiting the impact of current and future risks. With supply chain challenges likely to continue, business leaders will not only need to understand shifting buying habits but also adapt and build resilience. Here are a few areas where businesses can benefit from greater supply chain resilience.

See More: Three Ways Tech Can Make Supply Chain Solutions More Agile

Creating Customer Loyalty

Customer loyalty is a cornerstone for success in any industry, whether B2B, B2C, or B2B2C. But in many cases, the disruptions resulting from the pandemic have dissolved trust and broken long-term consumer-brand relationships. Due to current supply chain challenges, brands face delayed or unavailable products, making them unable to offer certain items to customers. 

Today’s consumers are often met with an out-of-stock notification when buying items. As a result, 66% of consumers have made purchases from a brand they normally would not, according to the above study. Initially, this seemed like a temporary issue that wouldn’t extend past the pandemic, but how brands manage these ongoing challenges is making a lasting impact on both consumers and businesses. With these issues influencing what brands consumers choose when making purchases, customer satisfaction must become a major focus to improve loyalty. This is because 32% of consumers said they have stopped purchasing from at least one brand altogether due to supply chain challenges.

Leveraging a business network that brings together buyers and suppliers for real-time collaboration and visibility can give organizations greater awareness of their supply chain and the risks it may face. This will enable them to deliver the right products on time, which is vital to consumer loyalty.

Communicating With Transparency Around Shortages

Along with wavering consumer loyalty, in-store shopping and product availability have also been in flux. Though there have been delays and shortages through online shopping, in-store shopping has also been inconsistent since the onset of the pandemic. In fact, 77% of consumers have experienced unexpected store closures or shortened operating hours over the past year.

To build trust and loyalty, it is vital that brands be transparent with their customers, despite disruptions. Brands can use an array of technology, supported by a business network, to gain visibility into their supply chain and share realistic expectations with consumers. With most consumers experiencing shortages and only 20% of brands perceived to be effectively communicating supply chain challenges, brands can stand out from their competitors by building an honest and transparent relationship with customers.

Delivering on Sustainability Demands

Consumer priorities have shifted over time, and many are looking to support sustainable brands that offer ethically sourced products. According to our study mentioned above, 36% of consumers said they purposely purchase from sustainable brands, and 35% said they buy from brands that practice ethical sourcing.

Despite consumers trying to make more conscious purchases, many are unaware of the impact that returns have on the environment. Returning items has become a normal part of the shopping experience both in-stores and online, but consumer expectations about the fate of this merchandise do not match reality. Our survey mentioned above revealed that 60% of consumers were unaware that many returned items end up in landfills. Now, many are taking this into account when they make purchases in the future.

With sustainability becoming a concern for many consumers and the increasing awareness of how returns can impact the environment, it is imperative for brands to have insight into their supply chain. However, visibility is just the first step; true resilience will allow for smarter, more sustainable decisions. With a network enabling resilience, an organization can approach procurement with a sustainability mindset and find suppliers that match their goals to meet these expectations and goals.

See More: To Efficiency and Beyond: Smarter Field Service Management with Schedule Optimization

Using Business Networks To Drive Resilience and Ease Consumer Concerns

Consumer expectations and needs have greatly shifted, and it is important that procurement and supply chain leaders from both B2C and B2B organizations understand how these trends are shaping their business. Organizations have continually needed to change and adapt over the course of the pandemic to combat challenges, and the industry needs the right tools to do so.

Business networks and intelligent technology can be incredibly valuable tools to increase resilience amid volatility, making it possible to forecast risks, improve business processes, and identify new suppliers. This is why it is crucial to implement technology that works in tandem with procurement. Leveraging a business network can enable businesses to mitigate future potential supply chain disruptions, as they can complete more rapid, efficient transactions. They also streamline the sourcing of suppliers, as procurement teams have access to solutions that contain predictive and advanced analytics, replacing processes that were formerly paper-based.

The last two years have shed light on the importance of the connection between procurement, supply chain planning, logistics, and plant maintenance to deliver the right products to the right customers in a timely manner. By working within a business network, buyers can pull from an array of suppliers for all these things, making their supply chain more resilient.

Here is one example of a business network success story: during the pandemic, a U.S.-based construction supply company needed 500 hospital beds for a new temporary hospital they were building to treat COVID-19 patients. A business network made it possible for them to identify alternative sources and secure the beds they needed within 30 minutes.

Moving forward, business networks will help businesses achieve greater sustainability, transparency, and ultimately resilience within their supply chains, benefitting end users and consumers. Using a network approach, procurement and supply chain leaders can address current concerns, from product shortages to ethical sourcing, while being prepared to address future concerns and disruptions.

How do you think technology can improve supply chain resilience? Let us know on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window .

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Tony Harris
Tony Harris

SVP and Head of Marketing and Solutions , SAP Business Network

With over 25 years of experience across both Finance and IT, Tony has spent the last 15 years focused on the Procurement solutions sector and is currently Head of Market Strategy for SAP Business Network. In this role, he leads solution management and marketing teams that form a bridge between SAP solutions and its customers. The team captures market trends, customer challenges, and insights from the field teams to create an outside-in view of the market that helps to drive innovation within SAP Business Network.
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