It is virtually impossible to discuss the impacts on the supply chain in today’s world without acknowledging the effects of COVID-19. Shortages extended into our daily lives from essential items like toilet paper and disinfectants, all the way to things like bicycles and arts and crafts supplies! As our need for items grew, we were willing to accept a “lower” quality product to satisfy our needs. Companies had to stock their shelves with whatever they could to meet consumer demands. When we look at these trends, we see that purchasing and procurement play a vital role in the supply chain and are intrinsically linked to the entire length of the value chain. Let’s take a closer look.
At the start of the pandemic, the Purchasing, Procurement, and Merchandising teams needed to quickly identify ways to keep consumers happy and get them the items they needed. Instead of waiting for the name brands to get them the product at hyper-extended lead times, they found alternatives. Purchasing and Procurement worked with smaller companies with ready supply to stock shelves that may have previously been in a low-traffic area or positioned as a lower value product. Stores knew that the panic-buying trends would cause consumers to buy whatever products they could find. It also meant that those consumers would create word-of-mouth marketing, which meant the Procurement, Purchasing, and Merchandising teams directly impacted sales and marketing bottom lines.
While most companies were able to pivot quickly, the initial shortages and delays highlighted how many companies could not monitor supplier capacity, quality, and timelines in real-time. While all of these metrics are imperative to ensure available supply during the pandemic, these metrics are also essential to mitigating long-term supplier risk. As we look ahead, investments to improve vendor management and visibility across suppliers should be a top priority for purchasing and procurement team leaders.
This need is where a solution like the GRID comes into play. An essential product in our solution set is the Vendor and Customer Management product. The Vendor Management product digitizes a previously manual and detailed process to provide key stakeholders with real-time updates and pivot a business’s supply chain with minimal risk.
GRID users can score vendors, factories, and mills on key, configurable metrics such as compliance, timeliness, quality, and cost. Over time users can then run reports for smart vendor assignments to improve speed-to-market and margins. This visibility also allows companies to have a single repository of all tiers of their partners. They can quickly enter new markets or start new projects based on trends or disruptions such as COVID without spending thousands in times and money to identify relevant suppliers.
This product’s effectiveness also streamlines and standardizes the process of onboarding qualified suppliers. As new vendors are onboarded on the GRID, businesses will know immediately if these new partners hit the key metrics to assign them work. Additionally, users can bid out work to their vendor network directly on the GRID to avoid back and forth on email, text messages, and phone calls for a more streamlined workflow. Once a bid is accepted, all relevant POs, invoices, and documentation can be issued and created on the GRID and tied directly to the product tiles for easy reference.
Digitizing vendor management is just a starting point to improve operations across the value chain. The long-term implications on the supply chain from COVID are still unknown. Still, companies have the opportunity to jump ahead and begin the process of protecting their supply chains through a digital solution.