Why supply chain agility is easier said than done
By Holly Clarke on February 6, 2025Supply chain leaders are constantly having to adjust their strategies as the world around them changes.
Global issues hit, consumer behavior shifts, and then within a couple of years it all changes once again — just when supply chain managers are starting to readjust. But the ironic thing is that supply chains aren’t agile; the steering of a ship takes time to change direction.
Having to adjust course is no easy feat. This is especially true as we continue to get hit by an increasing number of legislative impacts such as Brexit, sustainability requirements and other regulations — all of which are making things even more complex.
The core fundamentals are still just as important, such as efficient stock holding, maximizing service and operating efficiently. But with interest rates and the cost of capital at a high, this is becoming more of a knife-edge. Businesses can’t afford to have capital tied up in overstocked products, but they can’t afford to miss sales either. And, to add another complexity into the mix, they don’t want to pass too much of the cost on to their customers.
Meeting demand is constantly taking on a new meaning: how do I meet demand in the most cost-efficient way?
We must turn to technology to help us. Accessing optimal demand predictions, leveraging better inventory and pricing strategies and more agile ways of working are a must — they will help you steer that ship faster than ever before and, crucially, ahead of competitors.
We must turn to technology to help us. Accessing optimal demand predictions, leveraging better inventory and pricing strategies and more agile ways of working are a must.
Holly Clarke
Inventory AI Product Manager, Peak
Tackling the tightrope: data is key
Supply chain leaders are walking an increasingly challenging tightrope, and they have had to learn how to do it in real time. To keep output well-balanced, trade-offs between cost, speed and service must be factored in; this is at the same time as the landscape shifts, where uncertainty and higher customer expectations go hand in hand.
The agility of any supply chain is dependent on the strength and reliability of its data. That’s why how it’s captured is crucial, both in terms of accuracy and speed. Without this data providing a full overview of the supply chain, leaders are walking the tightrope blindfolded and imprecise data could send them further off course.
Agility over easy-going: give it time
Enhancing flexibility, responsiveness and adaptability are the key focuses for future-facing supply chains. But this can’t be achieved overnight. The entire business, at every level, should be on board with the fact that true supply chain optimization takes time.
Yes, embracing tech will encourage flexibility and provide detailed analysis, but instant success should not be expected. It’s essential that the supply chain team is committed to utilizing the newfound tech in as many ways as possible.
AI-powered optimization: achieving optimal inventory levels and pricing
Knowing how much stock to hold is an ever-present challenge for supply chain leaders. If demand suddenly changes, sales can be lost or capital gets tied up in excess stock. But the use of AI is providing companies with in-depth, accurate insight to achieve optimal inventory levels. AI can monitor stock in real time. It can balance fluctuating demand with factors like sales history, product availability and location. As a result, it can ensure the right product is in the right place at the right time.
The technology can also show teams the optimum price for products throughout their lifecycle. It can provide recommendations that balance customer demand and business objectives in a way that maintains margins and drives profit.
Predicting uncertainty? The power of accurate forecasting
Uncertainty will always be rife in the world of supply chain. Nevertheless, AI’s insights can ensure quicker decision making when your supply chain feels the ripples of a global event. AI can improve demand forecast accuracy and agility, helping organizations maintain good service and inventory levels while minimizing waste.
While not easy, agility in the supply chain should always be strived for; it powers a balance between operational efficiency and the flexibility needed to react swiftly when issues arise.
The bottom line
As supply chain leaders battle ongoing uncertainty, having accurate data and an agile team is crucial to effectively meet changing demand in a cost-efficient manner. It enables managers to walk an increasingly challenging tightrope of balancing internal strategy with external trends.
To implement such a strategy, embracing AI is key. Supply chain managers can capture and access real-time insights on their inventory levels, allowing them to maintain the right amount of stock and offer it at the optimum price. Crucially, this means that if global events impact demand, organizations can remain operationally resilient and steer their ship far quicker than would otherwise be possible.
This article was originally published as a contribution to SupplyChain Strategy.
