CSCMP's Supply Chain Quarterly
Manufacturing
March 31, 2020
Forward Thinking

Security, digital capabilities are ripe for disruption

Comment
Study highlights the changing nature of supply chain disruption and companies' need to broaden their perspective on business risks.

Supply chain disruption is moving beyond the physical to include cyber and digital capability concerns, and that means businesses must broaden their view of what it takes to prepare for potential risks, according to a recently released study from researcher IDC.

"Effectively, supply chains must be broadening their perspective on disruption to include not just traditional physical disruption but also cyber and digital capability disruption. Being truly resilient means adapting to and adopting all three," Simon Ellis, IDC's program vice president for supply chain, said in a statement announcing the results of the new report titled "The Shifting Nature of Disruption in the Supply Chain."

The report details how traditional elements of supply chain disruption, such as supplier insolvency, shipping delays, and quality problems, now exist alongside concerns over supply chain systems security and the importance of new, digital capabilities. It also explains how to ensure that supply chains can be resilient to today's varied forms of disruption.

The researchers point out that: 

  • Technology allows the supply chain to better manage complexity and globalization, but it also opens businesses to new vulnerabilities.
  • Supply chains recognize the broader landscape of disruption but at the same time feel inadequate to the task at hand.
  • In the near term, companies view supply chain transformation in terms of efficiency and effectiveness, but in the longer term, this view shifts to one of avoiding digital capability disruption.

The report also recommends actions companies can take to deal with the new disruption landscape: 

  • For a business to be good at avoiding disruption regardless of the form it takes, it is imperative that it looks at its own practices and sets in place the appropriate policies, processes, and tools, the researchers advise.
  • Supply chains must broaden their perspective on disruption to include not just traditional physical disruption but also cyber and digital capability disruption. Being truly resilient means adapting to and adopting all three.
  • Visibility is a critical element here, and not just internal visibility but also an ability to see the marketplace and anticipate the capabilities that are likely to be important in the future.

More information is available on IDC's website.

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