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Disruptions in Supply Chain can be mitigated through either redundancy or capability improvement.
When supply chain teams talk of various types of disruptions, their mitigation measures usually revolve around creating redundancy. This redundancy often comes at a significant cost to operations and delays such implementations.
Creating redundancy doesn’t have to come at a cost. If we focus on sharpening our critical supply chain capabilities of flexibility and responsiveness in the back-end operations, mitigation measure need not jack up cost of operations.
For example, if the demand of a specific product gets disrupted positively (e.g. malaria outbreak for household insecticides range), the same production capacity can be redeployed to produce much more of this product. Do we operate on frozen production plan for a horizon? If so, we must reduce it to zero. Techniques like SMED help in executing quick changeovers on the production line at no extra cost. These are nothing but capability improvements in flexibility and responsiveness.
Another example could be blockage of certain dispatch lanes due to a natural calamity. How soon can we reroute the consignment? Do we have to negotiate with the LSP or is this flexibility built into our contract? While some companies may take few days for this renegotiation, companies with flexible contracts can do it immediately.
There are hundreds of such use cases where disruptions are mitigated more effectively through capability improvement in flexibility and responsiveness.