Report from Jabil: Supply Chain Resilience in a Post-Pandemic World
Supply chain complexity is at an all-time high. If the ongoing component shortages, demand and supply fluctuations and geopolitical tensions weren’t enough, 2020 saw the largest disruption of any supply chain in memory: COVID-19.
The pandemic exposed supply chain vulnerabilities within many organizations. As companies scrambled to keep their supply chains on the lifeline on such short notice, they also had to keep their employees safe and comply with local policies.
To pinpoint how the pandemic will affect supply chains, what effects it has already had and how organizations are changing in response, Jabil partnered with Dimensional Research to survey 715 supply chain decision-makers in seven unique industries: automotive and transportation; consumer electronics; healthcare; telecommunications; energy and industrial; smart home; and retail.
Key findings:
MARKET DYNAMICS ARE STILL IN PLAY
• 7 in 10 say pandemic disruptions are impacting their supply chain
• While COVID-19 has overshadowed other market dynamics, companies are still struggling the most with supply constraints
• 90% report direct business impact from sourcing issues, especially in production delivery and time-to-market delays
• 42% of those in the consumer electronics industry have been forced to raise prices due to sourcing issues
• 71% of healthcare respondents have experienced delays in production delivery and time-to-market
• Only 13% of OEMs are fully executing a predictive supply chain risk management initiative
COVID-19 HAS DISRUPTED SUPPLY CHAINS WORLDWIDE
• Only 17% rated their predictive supply chain as “excellent” in facing COVID-19
• 99% are investing in technologies or services to address the pandemic’s impact on supply chains
• Supply chain network optimization and visualization applications are the most common investments toward
pandemic response
• Nearly all OEMs have had to make supply chain changes due to COVID-19. Most commonly, OEMs have optimized
processes or deployed new technology
• The most common changes reported to address logistics issues were to quickly identify new options for international
shipping and identifying additional options for “last mile” deliveries
• More than half of OEMs are looking to manufacturing partners for risk mitigation and flexibility due to COVID-19
• 35% say they are more likely to bring manufacturing in-house so they can have greater control
• Two-thirds of OEMs say COVID-19 has had the biggest impact on their supply chain in the last decade
• 92% have experienced a direct financial impact due to COVID-19 supply chain issue
SUPPLY CHAIN RESILIENCE TAKES CENTER STAGE
• 94% care about supply chain resilience but only two-thirds fund it appropriately
• Material availability, logistics and price escalations are the top focus areas of supply chain resilience programs
• More than half report quick recovery and multi-sourcing as their key supply chain resilience goals
• 6 in 10 say their supply chain strategies are focused on responding to disruption and reducing risk in the next two years
• Nearly 70% say time-to-recover is the most used metric in measuring their supply chain resilience
• Participants agree that sourcing, logistics and trade issues pose greater risks than demand issues
• 82% say their supply chain footprint has shifted notably due to COVID-19
• 89% agree that recent events have made the importance of a diversified supply chain clearer
