5 Ways to Build Adaptive Logistics Networks for Improved Resilience

Ever-changing customer expectations, a global consumer shift towards convenience and delivery flexibility and increased expectations from brands have amplified the need for resilience in supply chains and adaptable logistics networks.

According to the PwC Global Crises survey, 58% of CEOs prioritize supply chain safety, but 53% of them said that at least one of the crises experienced by them was operational in nature, including operational breakdowns, supply chain issues, and various forms of product failure. 

Lack of real-time visibility into shipment or asset movements and difficulty in making quick and actionable decisions bring down the resilience of logistics.

Some other factors that reduce resilience include expedited shipments driving higher logistics costs, difficulty in calculating “cost-to-serve” owing to limited understanding of current transportation assets, capacity utilization, and the inability to integrate different logistics components. 

Hence, businesses need to rethink resilience by making their logistics networks and ecosystems more adaptable and integrated. Here is a 5-step action plan for the same.

#1 – Enhance Visibility for Quick and Reliable Response

To adapt quickly to change, businesses need complete visibility across their supply chains, especially within their logistics network. IBM cites visibility as one of the major drivers of resiliency in the supply chains.

Getting alerts for events that can snowball into business risks, identifying operational bottlenecks, and tracking assets in real-time for reliable and robust management – visibility can boost resiliency in multiple ways. 

Further, the Business Continuity Institute reveals that 72% of suppliers who encountered a supply chain breakdown, lacked the full, real-time visibility required for agile and risk-efficient recovery. According to recent studies, visibility improves customer satisfaction by 65%, and revenue leakage by 30%.

#2 – Adjust Supply Chain Planning for Agile Scenario Response

A recent Oracle survey reveals that 92% of US logistics leaders feel that supply chain disruptions will only increase in the future. The vibrations of recent supply chain disruptions have also led to multiple shifts in consumer sentiments as 39% of them would now prefer to pre-order whenever possible, and 31% would prefer shopping in-person more than online. 

While we talk about consumer purchase sentiments, discussing their nuanced delivery service expectations is also important, as same-day deliveries and real-time visibility over order movements are becoming increasingly popular.

Hence, businesses need to make their supply chains more elastic and flexible to respond to such scenarios in an agile manner. They need to rethink their supply chain planning in light of new disruptions and market trends to ensure alignment with the evolving trends. 

#3 – Smart Collaboration for Trust and Transparency

Collaboration across partner networks is vital in complex and interdependent supply chains. The inability to get timely intimation of critical insights can not only affect the entire delivery flow but can also lead to higher operational costs and other business risks. Further, businesses need to ensure reliable and centralized collaboration across all their vendors, logistics service providers, and partners. 

Manually-managed supply chains fail to ensure robust communication and collaboration owing to a siloed management approach.

Also, businesses are unable to ensure transparency at multiple levels owing to the lack of a centralized information system. This brings us to the next step – integrated management.

#4 – Embracing Intelligent Automation for Integrated Operations Management

As much as 63% of US consumers seek regular updates about order shipping and 54% of them expect more transparency about delays or potential supply chain disruptions.

Further, more than 50% of them want refunds or discounts if the order is delayed owing to supply chain issues. Adhering to such high levels of service expectations requires the support of intelligent technology.

Hence, businesses need to orchestrate coordinated actions across various supply chain functions with cloud-based digital platforms. These platforms facilitate connections, exchange data, and automate processes.

Thus, businesses can manage the entire shipment lifecycle from a single place and can manage all the logistics components seamlessly.

#5 – Responsive Customer Service to Reduce Churn

Logistics and customer service are intrinsically linked, especially in today’s world where customers expect real-time information and hyper-responsive service.

Elevating customer service during disruptions can significantly impact customer loyalty and repeat business. Digital supply chain technologies and a customer-centric mindset play a crucial role in achieving heightened responsiveness.

Dynamic capabilities, such as real-time order tracking, automated personalized alerts to reduce customer query calls, and quick intimation about delays along with the reasons for them improve the customer experience and prevent customer churn.

The ability to offer such customer-centric service makes the logistics networks more resilient to major business risks, such as loss of customers, and bad word-of-mouth marketing. 

As the business landscape continues to evolve, an adaptive and resilient logistics network can be a definite competitive advantage. By implementing a step-by-step action plan, businesses can better prepare their logistics operations to navigate uncertainty and thrive in challenging times.