New Shocks, Better Solutions: Beating disruption with stronger, more responsible supply chains
By Pendragon Stuart, former Consultant at Sancroft.
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Business is facing a time of greater scrutiny and disruption to their supply chains – but this comes with great opportunity. Questions used to centre on efficiency and compliance in disconnected issues. Now businesses are embracing the need for active risk management, resilience, and better supplier relationships that create mutual benefits, whilst also fixing multiple issues at once.
Doing so not only avoids fines and improves reputation but is becoming critical in the next wave of cost reduction, productivity improvement and guaranteeing security of supply in a faster-paced fragile world.
At Sancroft, we have been mapping the six biggest disruptions coming to supply chains – and the new solutions businesses are creating, across:
– Consumer demand & challenger brand growth: People want more sustainable, ethical options, and formerly niche supply chain issues now drive significant business success. See Tony’s Chocoloney – a brand with a ‘slave free chocolate’ message at its core, that has now overtaken Milka in the Netherlands (Link).
– Growing activism from NGOs, investors & employees: Sustainable supply chains used to be something only committed NGOs fought for, now investors see this as fundamental to securing long term returns, while protests from Amazon’s own employees are credited with accelerating their commitment to go carbon neutral by 2040 (Link).
– New resource pressures: The pressures on biodiversity, soil erosion, rare earth metals, arable land are all accelerating, but now we’re seeing a new wave of solutions and approaches. This includes provocative statements from plant-based food companies like Impossible Foods that they intend to restructure the food system (Link).
– Circular economy shifts: The old take-make-waste system where we throw away huge amounts of product and packaging is increasingly recognised as inefficient for business and increasingly damaging. This requires not only rethinking how supply chains operate, but raises new questions like human rights in recycling (Link).
– Tech-enabled transparency: Businesses need better information to manage and optimise increasingly complex supply chains – while stakeholders demand it to ensure good standards are being reached. New tools like blockchain offer solutions – recording information on labour rights and production standards, and letting businesses incentivise those that meet these standards (Link).
– New and hidden labour challenges: Forced labour and modern slavery are rising up the global agenda, with new laws around the world, while in affluent countries, tech companies like Uber are innovating new forms of employment in the ‘gig economy’ – but then facing challenges around whether these support workers (Link).
We will be releasing an in-depth report as well as hosting a breakfast briefing in November to explore these issues, and what it means for businesses. If you would like to stay updated to receive the report when it is released and to receive an invitation to the breakfast briefing, please email events@sancroft.com to register your interest.
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