Importance Of Resilience Of A Supply Chain

Supply chain reliability is a key component of an effective supply chain strategy that delivers customer value. Uncertainty is one of the main reasons why a company carries safety stock. The company may be unsure about future demands of customers or uncertain about a supplier’s ability to meet a delivery promise or even about the quality of materials or components. Re-engineering of the processes that impact performance is the sure way to achieve significant improvements in reliability. In manufacturing, it was discovered that the best way to improve a product’s quality is not by quality control through inspection, but rather to focus on process control. The same is true for logistics and supply chain reliability. One key way to improve on supply chain reliability is to reduce process variability. Six sigma methodologies is one of the tools designed to reduce and control the variability in a supply chain process.

Today’s supply chain must be resilient in order to survive in a market place that is characterized by higher levels of turbulence and volatility. Resilience of a supply chain is the ability of the supply chain to cope with unexpected and unforeseen

Relationships such as partnerships within the supply chain can be very beneficial to the companies involved in the relationships. Partnership sourcing has become very widespread in many industries. The benefits of such practices include innovation sharing, improved quality, integrated scheduling of production and deliveries and a reduction in cost. Companies are increasingly realizing the advantages that can be derived from seeking mutually beneficial, long-term relationships with suppliers. As more processes are linked between the supplier and the customer, it becomes more difficult for competitors to break in due to an increase in mutual