Disruption as the new normal in food and bev
Undoubtedly, Covid-19 pushed the food supply chain to its very limits, with some even going so far as to say it was responsible for breaking it completely. What we have is a perfect storm of challenges for the global food industry. A dire shortage of workers and skills, in combination with sea containers stuck in harbours and spiralling transportation costs, not to mention the rising price of raw ingredients, have meant that many food manufacturers are struggling to meet demand while staying profitable. Existing weaknesses in the global food supply chain have been exacerbated and food businesses the world over are digging deep, doing everything they can to stand firm against all odds.
What can food manufacturers themselves do to boost their resilience against such challenging conditions? The after-effects of Covid-related and other economic pressures certainly do not seem to be going away any time soon, with more food manufacturers realising that they might have to start getting used to disruption as the new normal.
The UK Centre for Food Policy describes the food system as ‘the interconnected system of everything and everybody that influences, and is influenced by, the activities involved in bringing food from farm to fork and beyond’. Right in the middle of this complex system lie food manufacturers and processors, exposed to weaknesses and challenges at both ends of the wider supply chain. Already under pressure from seemingly ever-changing customer expectations and supplier challenges, the global pandemic served to expose and exacerbate pre-existing supply chain weaknesses, leading many food manufacturers to rapidly reassess just how resilient their supply chains actually are.
Ultimately, getting the right product to the right customer at the right time is still the overarching challenge, but with the added pressures of longer lead times and increased costs. What many businesses identified was a need for more flexibility and agility right across the supply chain, establishing more joined-up working, comprehensive visibility and a renewed focus on creating more intelligent supply chains able to adapt quickly and effectively to changing demands. At the same time, the ability to identify potential bottlenecks and inefficiencies before they have a detrimental impact is paramount – taking steps now to create more resilient supply chains.
With disruption quickly becoming the new normal, how can food businesses strengthen these weaknesses, creating more resilient supply chains that are able to scale and flex in-line with ever-shifting demands and challenges?
The go-to term for the last few years, ‘digital transformation’, is often heralded as the panacea for all business ills, including supply chain issues. For food manufacturers, for whom ever-shrinking margins are always a concern, full-scale root-and-branch digitally transformed supply chains aren’t always a viable option, particularly if it’s a case of change for change’s sake. Instead, by breaking larger projects down into more manageable initiatives, it’s possible to yield tangible benefits, helping to build a case for further change elsewhere in the organisation.
Maximise organisational visibility
High on the list of priorities has to be ensuring optimum levels of visibility and transparency across the organisation, making the most of the information available from the wider supply chain to optimise operations. The only way to do this is by standardising and uniting business systems right across the business.
It’s this level of oversight and visibility that helps businesses readily identify where inefficiencies and bottlenecks lie, enabling them to take the necessary action before these looming problems negatively affect operations.
Courtesy of Bizcommunity – read full article here.