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Do demand disruptions cause chaos in your supply chain?
Companies face high levels of demand volatility quite frequently, when actual demand coming from customers is much higher than the formal forecast or our intuitive sense. Such disruptions in the demand pattern usually cause panic and chaos in the supply chain, leading to loss of sales and people resorting to firefighting means.
If the supply chain is unable to handle such a large volatility, it is a clear indicator that certain supply chain capabilities need improvement. The chaos may be due to either inflexibility in certain parts of the supply chain or a delayed response.
We should use every such disruption as an opportunity to drill down to the specific point where we need higher flexibility or a faster response. Such an action strengthens the supply chain and makes it more robust to handle disruptions in future.