What does it take to build and maintain a resilient supply chain in today’s business environment?
When was the last time you remember supply chain disruptions not making top-tier news? From the start of the pandemic in 2020 through now, supply chains have stayed at the top of everyone’s mind, though not for the reasons anyone would like. Why haven’t companies figured out the answer yet? And how can we fix things now and in the long run?
Dr. Madhav Durbha offers a unique perspective on how businesses need to re-think the way they approach resilience and sustainability, and why these issues won’t be resolved if supply chain organizations are left to fend for themselves.
What happens when supply chain, procurement, and finance unite?
It’s great to talk about resilient and sustainable supply chains, but what do they look like in practice? And how do you achieve those goals?
The costs of doing nothing are high, but the right processes and technology can help break down barriers and divides between teams and organizations.
Coupa’s new eBook, Threading the Supply Chain Needle, details how when supply chain, procurement, and finance work together, they can make smarter, faster decisions to reduce risk and achieve profitability and sustainability goals.
Threading the Supply Chain Needle
How to break down silos to build resilience and sustainability
Thriving amidst uncertainty
The COVID-induced disruptions have been challenging for supply chain, procurement, and finance leaders, and new issues continue to mount. Even as the world learns to live with COVID, organizations now face geopolitical and financial risks in addition to new sustainability regulations. Department leaders find themselves fighting fires and reacting to problems they never anticipated.
For example, a key lane of transportation that becomes unavailable can impact inbound supplies, wreak havoc on production schedules, and make getting the product out the door that much harder. This ultimately results in lost revenue and demonstrates how procurement, supply chain, and finance all face the brunt of the impact.
Nearly 90% of supply chain professionals have said that within two years, they will make investments to boost resilience and agility in their supply chains, according to a Gartner survey.
However, it takes a thoughtful approach to thrive in this evolving, uncertain environment. The status quo mindset of operating in siloed departments and then only joining heads for annual planning events can no longer keep pace. When department heads try to manage it alone, the problems often grow bigger. Collaboration and cross-functional visibility are key to resiliency and agility. While these departments can all offer individual value to stakeholders, they often operate in fragmented ways, focused only on their own goals and failing to see the big picture and optimize for the larger organizational mission.
For example, while procurement negotiates the best discount possible based on volumes, the supply chain can run into a feast or famine situation with the purchased material availability. Meanwhile, finance’s goals are to optimize liquidity, reduce risk, and ensure top and bottom-line targets aren’t compromised. However, these goals can be jeopardized by departmental misalignment.
To address the mounting pressures and find new opportunities, supply chain, finance, and procurement must work together to make smarter, better, and faster decisions around a supply chain designed to meet the overall business goals. And in order to achieve these goals, organizations need technologies and processes that make it easier to bring together inputs and requirements from procurement, supply chain, and finance.
When business spending is seen as the common thread, these departments can break down silos, make supply chains more dynamic, and drive optimal decisions that benefit the entire organization. This enables leaders to make decisions that ensure product availability, make and move products with less risk, stay compliant with regulations, and make the world a better place by cutting down on emissions.
One thing that threads supply chain, procurement, and finance together? Business spend.
Download Coupa’s new eBook: Threading the Supply Chain Needle
Related Article: Optimizing Supply Chain & Sourcing in Times of Disruption