Why Supply Chain Risk Management Must Go Deeper 2025

According to a recent McKinsey survey, 90% of respondents reported encountering supply chain challenges in 2024. Yet, despite these persistent disruptions, many companies fail to identify and mitigate supply chain risks.

One of the most alarming findings from the McKinsey survey is the decline in visibility beyond direct suppliers. In 2024, the percentage of respondents who claimed to have good visibility into deeper levels of their supply chain dropped by seven percentage points, marking the second consecutive annual decline. This trend is concerning, as major disruptions often originate upstream, far beyond the immediate reach of direct suppliers.

The Visibility Gap

Improving collaboration with direct suppliers is undoubtedly a positive move, but it falls short when deeper-tier suppliers remain unaddressed. For example, a disruption at a Tier 3 supplier—like a raw material provider—can ripple through the supply chain, leading to delays, higher costs, and unmet demand. Companies stay reactive instead of proactive in managing risks without adequate visibility into these upstream tiers.

Slow Progress on Resilience

The McKinsey survey also indicates a slowdown in implementing systems and processes to improve resilience. This inertia could leave companies vulnerable to increasingly frequent disruptions, such as geopolitical tensions, natural disasters, or cyberattacks.

What Companies Can Do

Companies must prioritize enhanced supply chain visibility and resilience to address these challenges. Here’s how:

  1. Invest in Technology: Advanced analytics, AI, and blockchain solutions can provide real-time insights into supply chain operations, enabling companies to track risks beyond direct suppliers.
  2. Collaborate Across Tiers: Building relationships with Tier 2 and Tier 3 suppliers helps ensure a more stable and transparent supply chain.
  3. Conduct Risk Assessments: Regularly assessing risks across all supply chain tiers can help identify vulnerabilities before they escalate.
  4. Diversify Suppliers: Reducing dependency on a single supplier or region mitigates the impact of localized disruptions.

The Bottom Line As disruptions continue to be a constant, the need for deeper visibility and proactive risk management has never been more crucial. Companies that neglect to address these gaps risk falling behind in an increasingly volatile environment. By investing in resilience today, supply chain managers can secure a more stable, predictable, and competitive future.

May 9, 2025 Uncategorized Comments Off on Why Supply Chain Risk Management Must Go Deeper 2025

Take a Seat

The Evolving Role of Supply Chain Managers in Executive Leadership

For too long, supply chain management has been relegated to a back-office function—a necessary operation but not a strategic force. Yet, this perception must shift in today’s volatile, complex, and interconnected global economy. Supply Chain Managers (SCMs) are not just another seat at the executive table—they are the advisors, influencers, and leaders who bring a unique, cross-functional perspective to the forefront.

Supply chain management is a fusion of multiple disciplines.

Unlike finance, marketing, or HR, which have well-defined scopes, supply chain management is a fusion of multiple disciplines. It requires balancing internal operations, supplier relationships, logistics, risk management, technology, and sustainability while navigating unpredictable external challenges like geopolitical disruptions and climate change. SCMs don’t just optimize efficiency; they orchestrate resilience, agility, and innovation.

The ability of SCMs to connect the dots across diverse functions is invaluable to executive decision-making. They provide insights directly impacting revenue, profitability, and long-term strategic positioning. Under their guidance, a well-managed supply chain can be a competitive differentiator, driving cost savings, sustainability, and customer satisfaction, thereby proving their integral role in the business.

A well-managed supply chain can be a competitive differentiator.

With AI taking over more structured planning challenges, such as forecasting, inventory optimization, and logistics scheduling, the actual value of a supply chain leader lies in solving unstructured, blended challenges that emerge daily from different internal and external sources. AI can process data but cannot replicate the creativity, critical thinking, and human judgment needed to navigate unexpected disruptions, negotiate complex trade-offs, and drive innovation. In this evolving landscape, the role of SCMs will become a true masterpiece of leadership, blending strategic foresight with hands-on problem-solving.

But merely taking a seat at the table is not enough. SCMs must leverage their unique cross-functional perspective to influence strategic conversations. They should take responsibility and advocate for strategic investments in digital transformation, risk mitigation, and sustainable sourcing. By proactively leading discussions on future-proof operations, SCMs can shift from problem-solvers to visionaries who shape corporate strategy.

SCMs must leverage their unique cross-functional perspective to influence strategic conversations.

The modern supply chain is no longer a behind-the-scenes function but a central pillar of business success. As the role evolves, SCMs must embrace their leadership potential and make their voices heard. The executive table isn’t just a place to sit; it’s a place to drive change. It’s time for supply chain managers not just to take a seat, but to lead from it. The executive table isn’t just a place to sit; it’s a platform to drive change and shape the future of business.

May 7, 2025 Uncategorized Comments Off on Take a Seat

Stop Selling Full Solutions. Start Offering What Shippers Actually Need.

In today’s fast-paced supply chain landscape, shippers face an impossible choice. They need multiple niche solutions to manage an end-to-end supply chain effectively, but integrating all these solutions comes with high costs and complex implementations. The result? No clear return on investment (ROI) means shippers hesitate to purchase, stalling progress for themselves and solution providers.

Imagine the relief shippers will feel when they no longer have to navigate through overwhelming ‘all or nothing’ bundles. Instead, they can select the exact features they need, freeing them from unnecessary features and inflated costs. This shift in approach will empower shippers to make more informed and cost-effective decisions.

Consider the example of transportation management systems (TMS). Many providers offer comprehensive platforms designed to cover every possible logistics need. However, a small or mid-sized shipper might only need real-time tracking and automated billing. Forcing them to buy an entire suite discourages adoption and limits the provider’s market reach.

What if solution providers shifted their mindset? Instead of competing to sell full-scale systems, they could collaborate to offer key functionalities tailored to specific needs. This modular approach would empower shippers to pick and choose the features that deliver immediate, tangible benefits, putting them in control and boosting their confidence in their decisions.

Here’s what would change:

  • Shippers gain affordable, practical solutions: By purchasing only what they need, shippers can implement technologies that improve efficiency and reduce costs.
  • Solution providers expand their customer base: Offering targeted solutions makes attracting a wider range of clients easier, increasing sales opportunities.
  • Long-term trust and partnerships develop: When providers deliver real value, shippers are more likely to return for additional services as their needs grow.

Collaboration isn’t just an idealistic goal—it’s a business imperative. By working together, solution providers can create ecosystems where their products complement rather than compete with each other. This approach fosters a sense of unity and shared purpose, driving growth for individual companies and strengthening the supply chain industry as a whole.

So, what’s stopping us from rethinking how we offer value? It’s time to move beyond the outdated model of selling full solutions. Let’s focus on what shippers truly need: flexible, cost-effective tools that deliver real ROI. In doing so, we can build a more dynamic, responsive, and successful supply chain ecosystem for everyone involved.

May 2, 2025 Uncategorized Comments Off on Stop Selling Full Solutions. Start Offering What Shippers Actually Need.

What Started with a Joke

It all began as a simple joke—two iPhones, side by side, engaging in an endless loop of humor using ChatGPT. One phone told a joke, the other responded with another, and the cycle continued. At first, it was pure entertainment, a quirky demonstration of AI-generated humor. But then, something unexpected happened.

As the conversation evolved, the two devices started exchanging jokes and responding to each other’s viewpoints. They weren’t just talking; they were understanding. The dialogue shifted from humor to agreement, from randomness to structured discussion. It was a fascinating display of how AI systems can develop their own mutual logic, gradually aligning their perspectives without human intervention.

While this experiment was amusing, it sparked a profound thought: What happens when AI-driven systems designed for specific functionalities start communicating with each other in real-world applications? This question is more relevant than ever to the management of global supply chains.

When Machines Start Talking—The Supply Chain Scenario

Imagine an AI-powered procurement system in a global retail company negotiating with an AI-driven logistics platform. One system predicts a high demand for oranges and places an order for 20 tons. Another system, designed for cost optimization, analyzes real-time data and determines that rising shipping costs and port congestion make transporting these oranges unprofitable. Meanwhile, a third system responsible for sustainability flags the shipment as environmentally inefficient.

These systems begin an autonomous exchange without human intervention, much like our two iPhones. They validate, compare, and agree based on their programmed priorities. In the end, no human actively stops the order, yet the oranges never leave the port. What started as logical, independent decisions ultimately leads to a supply chain breakdown.

The Challenge of Autonomous Decision-Making

While AI and automation are revolutionizing supply chains, this example highlights a critical issue: What happens when systems talk but fail to align with broader business objectives? If left unchecked, AI-driven decision-making could create bottlenecks, unnecessary delays, or even financial losses. The key challenge is ensuring that these systems communicate and collaborate in a way that serves the bigger picture, and being aware of the potential risks is the first step.

The future of supply chain management will not involve replacing human decision-makers but finding a balance between automation and human oversight. Companies must design AI systems that optimize individual functions and align with overall business goals. As two phones telling jokes learned to “agree,” supply chain AI must learn to negotiate without compromising efficiency, with the reassurance that human oversight is always there.

Because, at the end of the day, supply chains exist to move goods—not to block 20 tons of oranges in endless digital negotiations.

May 1, 2025 Uncategorized Comments Off on What Started with a Joke

From Still Waters to Tsunamis: dApps for Resilient Supply Chains

Imagine a business landscape where operational agility is possible at any time without the constraints of rigid software systems. Historically, companies have struggled with cumbersome software solutions that are sluggish and costly, often stifling new opportunities for innovation. With the introduction of decentralized applications (dApps), this dynamic is poised for a revolutionary change in the digital world.

Companies have struggled with cumbersome software solutions that are sluggish and costly.

When it comes to supply chains, dApps are not just a solution, they are a game-changer. They offer unprecedented flexibility and efficiency, acting as reusable Lego bricks that can be reshaped to fit any changing requirement. Smart contracts and microservices enable global teams to develop customized applications at a rapid pace. By introducing decentralized applications, we are not only accelerating workflows but fundamentally redefining the operational essence of companies, assuring them that they can adapt to any future workflow changes in the shortest possible time.

Supply chains, traditionally characterized by their complexity and rigidity, can now embrace a new era of agility.

Supply chains, traditionally characterized by their complexity and rigidity, can now embrace a new era of agility. Business processes can now adapt fluidly to new, changing circumstances, much like water gracefully navigating around obstacles and effortlessly overcoming challenges. Thanks to the modular components that underpin dApps, rapid innovation is no longer a distant dream but a tangible reality. Workflows will accelerate like never before, propelling companies into a future where agility and operational efficiency merge seamlessly, sparking excitement about the endless possibilities.

dApps are revolutionizing supply chain management by aligning operational speed with the rapid pace of modern business demands.

Integrating dApps into supply chain management ensures that companies are now free of rigid systems that are slow to adapt to change. Instead, they can leverage the inherent flexibility of decentralized technology to increase responsiveness, improve transparency, and drive innovation. This dynamic approach optimizes operations and provides a competitive advantage in an increasingly fast-paced market. In essence, dApps are revolutionizing supply chain management by aligning operational speed with the rapid pace of modern business demands.

April 30, 2025 Uncategorized Comments Off on From Still Waters to Tsunamis: dApps for Resilient Supply Chains

From Ripples to Resilience: Strengthening the Supply Chain Network

Imagine a single pebble tossed into a still pond, its ripples spreading far and wide, touching more than just the point of impact. This analogy can also be applied to global supply chains, where even the smallest disruption can cascade through the entire network, leaving a trail of challenges in its wake.

Such disruptions, seemingly minor, cause a ripple effect, leading to lower revenues, delivery delays, higher inventory costs, and a loss of market share and reputation. The profitability of supply chains can be greatly affected by these negative impacts.

However, amidst this doom, the ripple effect also highlights the critical points in our supply chains that are most vulnerable. Identifying these points becomes crucial as it is the first step towards fortifying them.

In a linear structure, the ripple can move in both directions, causing damage. To mitigate this risk, we need safety partitions and risk barriers in place. In a multidimensional, networked ecosystem, individual incidents can be minimized and even eliminated through collaboration. The structure of the ecosystem itself serves as a risk barrier.

The game changer in this scenario is collaboration with digital technology. The power lies in distributed and controlled data exchange, AI for predictions, blockchain to enhance transparency, and IoT to connect and protect our supply chain ecosystem. These are not merely buzzwords; they represent our best defense against the unpredictable and our shield against the chaos of global disruptions.

Therefore, the question we must ask ourselves is not whether we should harness these technologies, but how we can effectively utilize them to build resilience into our supply chains. By embracing digital transformation and leveraging innovative technologies, we can strengthen our supply chains, minimize disruptions, and ensure business continuity. Let us work together to harness the power of digital technology and build resilient supply chains capable of overcoming the challenges of our ever-changing global landscape.

April 30, 2025 Uncategorized Comments Off on From Ripples to Resilience: Strengthening the Supply Chain Network

The Sherlock Holmes Principle of Global Trade

In global trade, where economies are interconnected and business landscapes are dynamic, the adage “It is a capital mistake to theorize before one has data” holds profound significance. These words, spoken by the fictional detective Sherlock Holmes, resonate beyond the realms of detective work and can be applied aptly to the world of international commerce.

Holmes’ insight is a cautionary reminder that jumping to conclusions without sufficient data can lead to flawed theories and misguided decisions. Without a solid foundation of information, business leaders may make assumptions and base their decisions on incomplete or inaccurate insights. Ultimately, these mistakes can lead to missed opportunities, financial losses, and even damaged business relationships.

It is a capital mistake to theorize before one has data.

This is particularly critical in the context of global trade and supply chains. Theories or assumptions about market trends, consumer behavior, and regulatory landscapes can easily lead to erroneous strategies that may not align with the reality of the global market.

Collecting, analyzing, and interpreting relevant data is essential to manage global trade effectively. Decision-making processes should be based on accurate and real-time information, allowing businesses to respond swiftly to market fluctuations, changing customer preferences, and emerging trade regulations. Data-driven decision-making enables companies to optimize supply chain management, allocate resources efficiently, and identify new market opportunities.

In the realm of global trade, adhering to regulatory requirements and compliance standards is crucial. Companies must analyze data related to trade policies, tariffs, taxes, and customs procedures to ensure legal trade operations that mitigate risks. By leveraging real-time data, organizations can maintain transparency, track product origin, and manage documentation efficiently. This enables them to minimize delays, avoid penalties, and maintain strong relationships with international partners.

Data-driven decision-making enables companies to optimize supply chain management, allocate resources efficiently, and identify new market opportunities.

Businesses need to embrace modern technological solutions to manage global trade data effectively. Advanced analytics tools, artificial intelligence, and machine learning algorithms can help process vast amounts of data rapidly and derive meaningful insights. Automation and digitization streamline the data collection process, reducing human error while improving the accuracy and reliability of information. Companies can gain a competitive advantage in the global marketplace by adopting technology-driven solutions.

Businesses need to embrace modern technological solutions to manage global trade data effectively.

In managing global trade, businesses must remember the wise words of Arthur Conan Doyle. Relying on data rather than theorizing allows for evidence-based decision-making, ensuring successful international operations. Understanding market trends, adhering to compliance regulations, and leveraging technology-driven data management solutions are crucial to staying competitive and maximizing opportunities in the global trade environment. By keeping data at the center of their strategies, businesses can confidently navigate the complexities of global commerce.

March 14, 2024 Uncategorized No comments yet

Tinder for global trade finance? Let’s swipe right to explore more!

Exciting changes are happening in global trade, with a digital transformation leading the way. One significant change is the move toward tokenizing trade flows. This means there’s an excellent opportunity to boost global economic growth.

One particular shift I am seeing is the move to electronic – and – hopefully tokenized bills of lading (eBLs). These hold a lot of promise for making trade financing more efficient and accessible. By using blockchain technology, eBLs become unique, unchangeable documents that can be utilized as financial tools. When paired with smart contracts, products in transit can be turned into tangible assets, allowing for instant trade and payment.

Tokenized eBLs become unique, unchangeable documents, turning products in transit into tangible assets.

But while tokenized bills of lading are a big step forward, they’re just one part of the bigger picture. We know potential financiers need more than digital BLs to make intelligent decisions. It’s like buying stocks — you need (constant and real-time) knowledge and information. Therefore, the goal is to give people involved in trade finance the tools they need to make informed choices. The aim should be for automated processes to mediate between parties that need financing and parties that can borrow money — a kind of Tinder for global trade.

The aim should be to mediate between parties that need financing and parties that can borrow money — a kind of Tinder for global trade.

To do this, the financier needs more than just eBLs. He also needs additional information about the risk of cargo in transit. We can build detailed risk profiles by collecting data from IoT devices on cargo, carriers, port operators, weather, social media, and more. The aim shall be to make this data accessible to everyone involved while keeping it safe and controlled.

Trade financing, powered by tokenized eBLS, could close the $25 trillion trade finance gap.

The potential benefits for global trade are huge. Powered by tokenized eBLs and reliable data, trade financing could close the $25 trillion trade finance gap. This could create new opportunities for thousands of companies to manage cash better and cut costs.

March 14, 2024 Uncategorized No comments yet

Imagine a world where data isn’t just data but its own currency!

In one corner, we have the Central Data Lakehouse – a singular, powerful entity holding the reins of the global data economy. On the other side is a decentralized network of data points.

Who should hold the power in our data-driven world?

Two models. One question: Who should hold the power in our data-driven world? The debate between a central data lakehouse with a singular owner versus controlled decentralized data access is intensifying in the realm of global supply chains.

The centralized approach offers simplicity and order but risks creating a monopoly that stifles innovation and equity.

We have the allure of a centralized powerhouse, where one entity or a few entities reign supreme, turning data into gold. It’s the gatekeeper, the one owner making all the money from the data. Efficiency and control are bundled neatly into one package.

It’s the gatekeeper, the one owner making all the money from the data.

Centralization promises efficiency and simplicity. One owner, one rulebook, one streamlined process. Yet, in a landscape where data is king, monopolizing this resource could suppress innovation and concentrate power in the hands of a select few.

On the other side is the era of decentralization, a mosaic of data ownership. In this scenario, each node in the supply chain is a custodian of its information, a decentralized network of data points. It’s a vision of democratization, where each participant, no matter how small, has sovereignty over their data, their slice of the data pie, and the potential to monetize it. They control it. They profit from it.

It’s a world brimming with opportunities, collaboration, and innovation.

This isn’t just about fairness; it’s about unlocking a treasure trove of insights and opportunities previously buried in silos. It’s a world brimming with opportunities, collaboration, and innovation. But it’s also a world that demands trust and transparency as we’ve never seen before.

A decentralized system promises empowerment and opportunities for all but comes with challenges. Decentralization demands robust technology, unshakeable trust, security, and a new collaborative playbook.

A world that demands trust and transparency as we’ve never seen before.

As we stand at this crossroads, the future of our global supply chains hangs in the balance.

March 14, 2024 Uncategorized No comments yet

From the Glaciers to the Palm Trees

Recently, I had the privilege of attending a meeting in the luxurious ski resort of St. Moritz, Switzerland. The journey there, aboard the Bernina Express, proved to be an unforgettable experience.

Traversing the highest railway tracks in Europe and the world’s steepest, this iconic train ride offered a breathtaking voyage through 55 tunnels and over 196 bridges. From Switzerland’s oldest town, through awe-inspiring gorges and past remarkable structures, to the eternal ice of glaciers, and finally descending to the palm trees of Italy’s Tirano, the journey was nothing short of spectacular. Side remark: In 2022, the rail operator achieved a remarkable feat, setting a new record by operating a 1,906m-long train to commemorate its 175th anniversary.

As I marveled at the passing scenery, I couldn’t help but ponder the incredible engineering achievements of over a century ago and the recent world record-breaking accomplishment. Could there be lessons in overcoming such monumental challenges that could be applied to managing global trade?

Here are five lessons I’ve gleaned:

  1. Persistence and Determination: Overcoming complex challenges requires unwavering persistence and determination, crucial traits in managing global trade and supply chains.
  2. Adaptability and Flexibility: Like the rail track construction, adaptability and flexibility are essential in responding to changing market dynamics and unforeseen disruptions in global trade.
  3. Collaboration and Partnerships: Effective collaboration among various stakeholders is vital to building resilient networks and ensuring smooth operations in global trade.
  4. Innovation and Technological Advancement: Embracing innovative technologies and solutions can optimize efficiency and address challenges in global trade management.
  5. Risk Management and Contingency Planning: Robust risk management strategies and contingency plans are vital for navigating uncertainties and disruptions in global trade and supply chains.

By applying these lessons, businesses can enhance their ability to tackle challenges, foster collaboration, embrace innovation and effectively manage risks in the dynamic landscape of global trade and supply chains.

March 14, 2024 Uncategorized No comments yet
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