All businesses are aware of the strain that recent global events have placed on supply chains. The pandemic has led to increased freight costs and carrier surcharges. Brexit policies have resulted in product shortages and unfulfilled orders. However, these events have only highlighted existing problems – a lack of resilience in supply chains. The Covid-19 pandemic and Brexit have caused major disruptions, but conventional supply chains have always carried an element of risk.
It’s not just companies that are aware of the need for more resilient supply chains – even governments are getting involved. The European Commission has adopted resilience as part of its new EU policy-making strategy, and supply chain stress testing was discussed during this year’s G7 summit, similar to the tests carried out in the banking sector.
Those immersed in supply chain management are all-too-aware of the impact that export restrictions and grounded flights have had on their processes. But an often-missed consideration is the potential damage caused by cyber-attacks.
A failure to take necessary precautions can not only result in a huge financial hit, but many businesses could fail to recover at all. With so much at stake, business leaders need to consider a fresh approach by building greater resilience through the use of AI and supply chain stress-testing.
The number of high-profile cyber-crime cases demonstrates that supply chains have given insufficient priority to building systems capable of dealing with hackers.
Let’s look at global container shipping company A.P. Moller-Maersk as a case in point. In 2017, a cyber-attack disabled all of Maersk’s computers, meaning their supply chain procedures had to go manual overnight. A single server remained uninfected due to a lucky power outage just prior to the attack. From this, the company was able to rebuild its system of 4,000 servers and 45,000 computers. But the attack cost A.P. Moller-Maersk $300m.
It’s clear from such examples that a more resilient approach to cyber-security is essential. But with so many digital handshakes taking place across a single supply chain, how can this be managed?
Businesses need to protect their own assets in-house, as well as having a system in place regarding external suppliers. Adopting a distributed operations system spreads your assets across multiple sites. In the event of an outage – for any reason – a business can keep running simply by switching to a different carrier, in another location.
The same approach can be adopted with cloud-based systems, so an alternative facility is always available should your primary service be affected. A different approach to traditional means is central to this – utilising artificial intelligence in supply chain management.
Moving your processes into the digital age won’t just enable the likes of distributed operations and servers in real-time. Such a shift can also be helpful for analysis of supply chain weaknesses, so you can resolve problems before they occur.
Conventional methods of supply chain risk management rely on historical data. This usually means that a problem has to occur before it can be identified. Systems are then improved to guard against a repeat occurrence.
Given the example of Maersk, it's clear that such a process is ineffective. Even if a company’s systems were shored up to prevent a similar cyber-attack in future, too much time, money, and reputation has already been lost.
A more logical solution can be found through the process of supply chain stress-testing. As part of our AI-powered logistics platform, 7bridges builds digital twins to run simulations that can stress-test supply chains. A ‘twin’ of a specific supply chain is created, then subjected to tests geared towards sniffing out vulnerabilities. These could include ‘what if’ scenarios like a warehouse going offline, failure of a logistics carrier or perhaps being unable to access key systems during a cyber attack.
Seeing the potential impact of these events makes it much easier to create real contingency plans, and ensure that systems have a failover in place.
Any part of a supply chain can be subject to attack, and so testing involves every aspect of the process. As a result, supply chains have much greater resilience, and your business is far better equipped to deal with any eventuality.
The 7bridges AI-powered logistics platform enables supply chain stress-testing as part of a wider suite of logistics management tools.
Our software enables businesses to achieve greater resilience across all aspects of the supply chain, in a way that conventional procedures and manual processes simply cannot achieve. Logistics professionals wary of the costs needn’t worry. A return on investment (ROI) can be expected within four weeks, and savings of 30% on direct logistics costs are likely in normal conditions.
There’s no disruption caused to your existing procedures either. We can connect you to our software platform in just a few weeks, and your current set-up will actually be simplified. By using a single interface, all of your logistics data will be accessible in one place.
By adopting our logistics automation technology, everyone working across the supply chain will be enabled to focus on tasks and strategies without being held up by unforeseen disruptions.
Not only can we give you the visibility you need into supply chain weaknesses, you’ll also be in the best possible place to react in real-time to any challenge your supply chain is faced with. Through pandemics, Brexit, natural disasters or any other form of upheaval, you’ll have the ability to find the best means of fulfilment for every order placed, in the most cost-efficient way.
Using artificial intelligence in supply chain management may seem like a vision of the future, but adopting it now will provide your business a marked advantage over your competitors, and potentially save it from catastrophe.
7bridges’ whole ethos is to enable your business to keep running in any eventuality. To learn more about how we help businesses like yours gain clarity, control and create greater supply chain resilience - get the free guide to Supply Chain Resilience.