Design a flexible supply chain to overcome Brexit uncertainties

Date Posted: 22/03/2018 Category:
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Design a flexible supply chain to overcome Brexit uncertainties

Date Posted: 22/03/2018 Category:

The UK and the European Union are currently in the process of agreeing to the terms of Britain’s withdrawal from the bloc. This exit is bound to have an impact on international supply chains, which is why astute organisations are looking to the future and redesigning their processes. The focus should be to create a dynamic supply chain that can withstand and adapt to changes once Britain leaves the EU.

While we know that the UK will be leaving the EU in March 2019, the lack of finer details about the transition brings a level of uncertainty into supply chains. Since your business has the benefit of an advance warning, it is imperative that you create a plan to equip your supply chains in such a manner that they are robust and can handle the outcomes of Brexit.

To ensure this happens, there are three key areas that you need to work on:

Mapping supply chains

Mapping will help you identify the end-to-end value chain of the supplier base. As a result, the procurement team will have a better understanding of the trade flow and how it will be affected if the nation exits the European Customs Union.

Presently, a product can be assembled in multiple factories across different countries without hindrance. However, this will cease once Britain is out of the bloc. Mapping essentially helps you understand trade flows in addition to the impact of higher tariffs and new regulations that your suppliers will have to deal with.

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Design and develop risk management strategies

Anything could happen after Brexit. For one, a supplier might raise costs due to higher tariffs or could even stop trading with the UK. It is best practice to ensure that you have the right risk management strategies in place to manage these issues with ease.

In the initial years after transition, there will inevitably be uncertainty. But with the right risk management procedures you can mitigate ambiguities and hazards while managing trade. This will also enable you to identify bottlenecks and overcome them, thereby reducing lead times. Effective strategies will prevent hastily taken reactive decisions, thereby allowing you to enjoy a competitive edge over your rivals.

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Skills gap analysis

Gap analysis allows you to see where your organisation is lacking in skills. It is necessary to have the right professionals across your supply chain to manage uncertainties in an effective manner. By training and upskilling the existing staff, your organisation will be well equipped to handle the challenges posed by Brexit.

Pay attention to these three critical areas to ensure your preparation for the transition.

Steve Trainor

Steve has over 28 years of success as CPO, MD and Procurement BPO leader in a range of industries. Steve is COO at Odesma, responsible for Odesma’s delivery capability & infrastructure.

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