As the COVID-19 pandemic spread throughout the world, supply chains and procurement saw their traditional modeling around price negotiations, contract compliance, and cost control become overwhelmed with unprecedented challenges. Through this time, Premikati has learned that managing risk is paramount.
Suddenly, supply chains and procurement have been disrupted in ways we have not seen in our lifetimes. Many large and small entities had to immediately reconfigure their manufacturing, and procurement, to producing, distributing, and meeting the most essential healthcare supplies and foods to ensure populations are safe and healthy.
All of these actions required identifying new suppliers, vetting them, and ensuring enough liquidity to purchase necessary goods at scale. Further, unused inventory needed to be addressed as well.
Invariably, experts from every field prognosticate on how COVID-19 has changed our lives – and our economies – forever. The many blanket, and even extreme, disruptions to our work lives only serves to convey that we are still all playing a role in this huge experiment where technology has led the transition from traditional office environments to remote working and virtual happy hours. Is the future here, right now?
At Premikati, we don’t have any exact predictions around how this pandemic will impact procurement processes over the long term. What we do see is an opportunity to determine how digitization and new platforms can help companies gain a competitive edge once we reach the other side – and, we will.
Naturally, we all hope the pandemic will end soon and life will return to normal – as it has in previous disaster scenarios. Yet, it appears that many facets of our economy will never return to the pre-pandemic version of normal.
At this point, technology can help solve many of the issues which the pandemic has brought to the forefront. It’s time to change the mindset and work in a more collaborative and strategic way.
History in the making
For the first time in modern procurement, and supply chain history, a pandemic created a global impact on supply, demand, and the available workforce simultaneously. In order to revive the supply chain, and get things back to efficient processes, we view automation as a critical aspect.
In light of the global cracks in the supply chain, automation can help to increase productivity at home and with alternative suppliers who are located much closer to the communities they serve. In fact, with automation, many processes can be successfully executed domestically while creating new job opportunities for tech-savvy employees.
We also consider how important data will be not just now, but for the future of work. For procurement, greater connectivity demands an acceleration in digitization across the board and a utilization of collaboration tools, industrial IoT, and AI-driven insights to improve agility, capacity, predictability, and availability.
What does the future hold for procurement?
At Premikati, we truly believe that companies who invest in strategic technologies will come out of these perilous times with a competitive and profitable edge. Not to mention, your in-house team can ultimately become much more productive.
The COVID-19 pandemic has been a wake-up call for procurement in terms of addressing supply chain risk and business continuity. Perhaps it’s time for full-scale deployment of connected intelligence.
Yet, sourcing is just one side of the issue. Companies should also understand the supplier side. When you can comprehend the issues affecting your suppliers, then you can more efficiently ward off potential issues in the future. Some of the most critical components for the supplier side include:
- Tier 1 supplier risk
- Ensuring an alternative supply network
- Efficient workforce planning
- Bolstering the supply chain
- Improved planning
- Business continuity amidst plant closures
- Production flexibility
- Capacity security
- Global planning
Think about your non-negotiables: Customers, employees, products, services, lines of business, and more. Which of these are the most critical for business preservation?
Without adequate plans in place, many businesses went towards overadjusting where they would increase inventory across the board – just as consumers were doing the same hoarding toilet tissue, masks, disinfectants, canned goods, soaps, and hand sanitizers. Nonetheless, overadjusting can come with consequences such as excessive inventory during a time when consumers have cut back on spending.
Disruptions have occurred upstream and downstream. The most successful companies will work on improving visibility, agility, and responsiveness using strategic analytics. As a result, you can determine how you can mitigate the risks and begin recovery quickly.
At Premikati, we realize that every company is at a different stage in terms of dealing with the impacts of the pandemic. Not to mention, problems can vary depending on region. We want to offer guidance on where to find opportunities in the midst of unprecedented challenges. Quick action is essential right now.
Premikati can help your organization control the narrative and the outcome, complete with a thriving environment. Working through this crisis, we are prepared with new business models created to define the future of work in procurement and for supply chains.
The organizations with the highest likelihood of weathering this storm are those who have achieved the optimal balance between short-and-long-term strategies. During a crisis, the most common mindset is the short-term one. On the other hand, being forced to operate differently has helped many businesses see what they can do and also, what they need to do.
More than just adapting to the current environment, become a market shaper and take part in the reinvention.
Premikati hopes that by sharing what we’ve learned about this pandemic, that we can help strengthen your procurement processes. Our solutions are focused on accelerated efficiency, resiliency, mitigation, scalability, and flexibility. We are all facing this together, so let’s collaborate.