Thanks in large part to recent catastrophic events and the fallout they’ve had across supply chains and logistics systems worldwide, more businesses than ever before have been forced to take a closer look at their crisis recovery plans. COVID-19 highlighted just how interconnected the global supply chain is across industries- and while the impacts of the pandemic were still being felt, the Suez Canal was blocked up by the Ever Given, creating yet another supply chain nightmare. So how do companies prepare themselves, reduce risks, and minimize impacts from crisis events? How long do we expect impacts from the Suez Canal event to impact downstream services? And how does data analysis and utilization help to minimize and mitigate risks?
A Lasting Impact
Crisis impacts vary in large part due to the significance of the event, and industries and individual businesses impacted, and the type of crisis. Impacts can last months, even years, like continuing fallout from COVID-19, or several weeks, which is the expected case now that the Ever Given has finally been unstuck from blocking all activity in the Suez Canal. Depending on the amount of cargo a region, industry, or company relies on that travels through the Suez, immediate consequences can be dire. However, the residual impact on international trade and supply chains is expected to be felt for much longer.
Data analysis of vessels and materials that were found onboard ships that traverse the Suez Canal indicate that European countries are likely to suffer the most negative impacts from the Ever Given event, with a ripple effect impacting Asia as well, as they are reliant on goods that will be delayed in coming from Europe. This, in turn, will cause delays in the ability to deliver goods in a timely fashion globally. Annual data that tracks what kinds of goods and materials were likely affected allows for an estimation of the overall impacts, though the picture is not complete. The impacts on downstream delivery of goods and services could be more extreme depending on the abilities of those impacted companies to draw from diversified sources and suppliers.
Reliant on Data
As companies and industries attempt to better prepare to face the unpredictable world that is an increasingly global supply chain, they are more reliant than ever on data collection and analysis, in tandem with intelligence and predictive analytics to help lay out solutions for a variety of scenarios. Risk analysis, diversified sources, having suppliers that are in a variety of regions including more local options- all of these are ways to reduce the risk of catastrophic impacts or extended delays in functionality in the event of a weather, geopolitical, or pandemic-like crisis. The more options and contingency plans are in place, the faster the recovery for the impacted business. Data is vital in risk analysis and planning, and thus is a key ingredient in minimizing the long term effects of a crisis event.
The weaknesses in planning, data gathering, and resilient supply chains were highlighted in stark relief by COVID, and while many businesses were still putting together flexible solutions, the Ever Given tossed a new wrench in the works. Flexibility and responsiveness to a crisis are more valuable than ever before. Using predictive analytical data, creating crisis recovery contingency plans, developing diversified supply chains and sources, and bringing some aspects of manufacturing, shipping, or processing in-house have been among the successful solutions. Crisis management teams have been incorporated into many businesses as well. While most crises will ultimately come as a surprise, being thoroughly prepared for a variety of scenarios and being proactive in crisis management is the new normal. While not all emergencies can be anticipated, data solutions mean preparing for and anticipating potential crises, actively monitoring potential threats, and making the most of the information available- preventing what can be prevented, and staying resilient.
Is your business prepared for the next crisis event? Talk to a VIZION visibility expert today about how VIZION can help you prepare for the next inevitable event.