Outlook

Supply chain diversification has already become a popular theme in supply chain management, and for good reason. It is an essential strategic lever for building resilience, enhancing customer centricity, driving profitability, improving sustainability, and gaining a competitive advantage.

Future-proofing supply chains

With disruption accelerating, diversified supply chains are expected to become increasingly significant. Recent experience demonstrates that companies with strategically diversified supply chains are better positioned to navigate uncertainties and seize emerging opportunities. Today’s new normal demands continuous assessment and more regular reconfigurations of supply chains to meet new requirements, enhance risk profiles and maintain or improve agility and resilience. 

Transparency and visibility across the entire supply chain are imperative and the foundation for success, with state-of-the-art technology, supply chain management tools and strong partnerships playing a decisive role. 

It’s important to understand that there is no one-size-fits-all approach to supply chain diversification. Each company’s situation is unique, and individual factors must be considered, such as market dynamics, the existing supply chain setup, strategic business objectives and the ability and willingness to tackle risks.

However, companies looking to leverage the full benefits of supply chain diversification highlighted in this report must embrace collaboration across the entire supply chain. Logistics service providers like DHL can play an important role in this, from supporting the assessment of the current level of diversification to helping map out the supply chain, determining solutions that best meet a company’s overall strategic goals and managing the continuous assessment and improvement process.

We hope this report’s structured, actionable model will allow companies to go beyond the buzzwords and explore the nuances and potential benefits of supply chain diversification. With a deeper understanding of the four dimensions, companies can overcome the challenges and make strategic decisions to build resiliency and consistently meet customer needs in today’s volatile global marketplace.