The global pandemic has caused as much disruption to business and world trade as any major war or environmental disaster.
It has revealed systemic weaknesses across industries, organisations and governments. Unravelling problems, unblocking bottlenecks and ensuring services has been made all the more challenging where systems are opaque, closed and proprietary.
Decades of globalisation have disconnected consumers from the reality of production. But the COVID-19 pandemic has reawoken them to issues of production, with people wanting more information about the origin of products. Scares over possible virus contamination on packaging, for example, has made safe handling a paramount concern.
In the post-pandemic world, Australian businesses need to champion transparency, authenticity and provenance. This is critical for several reasons:
- Operational efficiency: ensuring seamless operations, from business workflows to logistics and fulfilment, is a competitive advantage and avoids wasting time and labour that can be deployed more valuably elsewhere
- Customer trust: consumers increasingly demand transparency and social responsibility when choosing products and services, and are much more empowered (through social media and/or online reviews) to voice dissatisfaction
- Regulation and compliance: increasing regulation around consumer privacy and data use, environmental responsibility, higher safety standards mean that organisations will increasingly face auditing and penalties for breaches, as well as reputational risk
In short, businesses need to be the "good guys" these days. They need to be open and honest about where their raw materials and products are sourced. They need to be transparent about their environmental footprint and the carbon cost of supply chains. And they need to be proactive about ensuring their operations do not contribute to human exploitation or harm.
So how can businesses ensure this level of transparency throughout their supply chain and operations?
1. Start by taking a holistic approach
We tend to think of "supply chain" as part of a business, the part where products move along the line from sourcing to shipping. Whereas it’s actually the whole business - including the people involved in the supply chain at every stage. As we’ve seen with the Uighur forced labour cotton scandal in China, consumers and governments will no longer accept exploitation in any part of the supply chain. This applies from sourcing through manufacture to end delivery: food delivery companies are increasingly facing legal action for underpaying delivery staff. You need to be transparent about and accountable for every part of your business - every "cog in the machine".
2. Create intelligent supply chains
Technology can enable transparency in end-to-end supply chains - tracking the journey and impact of the things we buy. Manual processes are too slow and too error-prone and inaccurate. Having an intelligent ERP system, with real-time data, is vital. This means you can instantly account for every element, even as costs move, and ensure the right cost of sale. Demand forecasting can also be used to track customer trends, enabling a business to keep their fingers on the pulse.
3. Provide authentic, auditable records
Data integrity and security are key, and one way to ensure this is through public blockchain enables transparency with integrity. It creates a decentralised, auditable, tamper-proof layer of verifiable information between businesses and shoppers. Since COVID there has been a focus on buying local and caring about the impact on people and the environment. Blockchain technology allows physical products to come with digital passports. This can include place of origin, where it was grown, if it was organic, as well as the details behind a product, including the conditions of workers.
Transparency should not be considered a challenge or "cost" to a business. It’s actually a powerful competitive advantage. Having complete, real-time insight into operations enables business leaders to streamline, scale up and down, pivot and adapt to stay relevant and competitive amid volatile market forces.