The resilience of the supply chain to threats that may occur along the way of the entire process is an undeniable foundation. No matter how complex a company's structure or how extensive the entire process is, proper supply chain management will not only improve the quality of the services provided, but also protect the company from potential financial losses.
How do you safeguard your interests and those of your counterparties against potential threats? What type of risks are they and what might be their consequences?
What does security mean in the supply chain?
In previous years, as many as 60% companies have admitted that they disruptions in the supply chain resulted in a 3% decrease in key target indicators. In as many as 40% companies, it was irregularities in the supply chain that resulted in lower total shareholder returns.
Supply chain security management systems is primarily a combination of appropriate strategy, management and software. The longer and more complex the supply chain becomes, the greater the risk that disruptions will occur along the way in the execution of the process, which can cause serious damage to the company. Such risks include terrorism, counterfeiting or theft, among others. However, proper supply chain management can minimise or even eliminate the possible effects of such situations.
Supply chain security should be based on a strategy consisting of a refined management process coupled with the implementation of a suitable IT system to track delivery from order to payment of the invoice.
Secure supply chain should, however, exhibit a number of key characteristics that are likely to ensure this safety.
A secure supply chain should first and foremost be adaptive (Adaptive Supply Chain). This means that:
- The strategy is to be able to adapt the process to changing market conditions
- The process can be modified in response to changes in the execution environment at its various stages
- Management envisages making internal changes to the supply chain itself, using structural and functional reserves and, above all, IT systems.
How to secure the supply chain?
As we have already mentioned, a well thought-out strategy is the basis for process safety. To enhance supply chain security, the development of the area should be targeted:
- Increasing the flexibility of operations
- Sharpening the sensitivity to the needs of the recipient
- Developing resilience to supply chain disruption
Securing the supply chain However, it also involves conscious risk-taking and proper risk management. To have a chance of minimising the consequences of failure or disruption, a company should bet on strengthening its structures by implementing modern technological solutions.
Eveneum has developed integrated supply chain management system ESSA, whose functionality is to be further enhanced by blockchain technology. What does this mean in practice?
Blockchain technology has long been used in the advanced structures of the financial industry. It is on blockchain that the well-known virtual currency BitCoin is based. Blockchain, in turn, is blockchain technology. In relation to the supply chain, it allows the entire process to be tracked from start to finish, without missing out on the smallest details and events during execution. The data stored in the system makes it possible to track the fate of an order with up-to-the-minute accuracy. Importantly, the data stored in the system is non-editable. No one enters them manually, nor can anyone modify them. In this way, blockchain increases the chance of detecting and counteracting irregularities resulting from supply chain disruptions.
Blockchain also means the security of the participants' data. The data is encrypted so that no unauthorised person can see it or identify the participants.
Such a solution not only protects the interests of the company, but also improves the quality of the services provided and thus increases the competitive advantage.
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