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Reforming Your Supply Chain for Good
A vast opportunity presents itself today, more than ever, for businesses to become more resilient and agile by aligning their supply chains. Years ago, proximity to resources, access to markets and conventional transportation were enough to fuel growth and prosperity. In the past century, dynamics have shifted and what once would position your company for success, may not be enough now.
Reforming Your Supply Chain for Good
A vast opportunity presents itself today, more than ever, for businesses to become more resilient and agile by aligning their supply chains. Years ago, proximity to resources, access to markets and conventional transportation were enough to fuel growth and prosperity. In the past century, dynamics have shifted, and what once would position your company for success may not be enough now.
“Associated Bank has a fortunate perspective,” says Rod Murray, EVP – Head of Commercial Banking. “We’ve built a long legacy in the upper Midwest, growing with the market, and leaning into those Midwestern ethics you can expect us to roll up our sleeves and be right alongside our clients. Frankly, we’re willing to go that extra mile…or 10.”
As a reliable financial partner, we’ve grown globally with our clients and through these relationships we’ve developed a broad-based picture of supply chains in a full spectrum of industries. This is the point of view we offer today.
The Mid-Range of a Pendulum
Fixing disruptions, solving issues and addressing challenges to supply have become all-too-familiar occupations. The urgency of these disruptions, issues and challenges, and their apparent complexity, can hide the key fact you need to put them behind you and fix your supply chain for good.
We’ve been allowing the pendulum of supply—from local to national to offshore to global—to swing for too long. With the pandemic precautions we faced in 2020 and the geopolitical complications that have recently come to light, we’ve discovered how fragile our supply chains really are.
The goal of our wisest clients is to capture the mid-range of the supply chain pendulum. Reaping the advantages of globalization, while mitigating its risks, means realizing that fixing today’s problems will not in itself do the job.
The Nature of Improvement
Diversifying sources of supply through on-shoring, near-shoring and investing in manufacturing and transport facilities requires investment, and it takes many forms. Easing transportation jams alone will not yield enduring solutions; however, and even new manufacturing capacity—on the part of our clients or their suppliers—will not necessarily solve the problem in either the short or long term.
For example, the welcome and well-known investment made by Intel in a thousand-acre, $20 billion manufacturing facility in Ohio is understandably geared toward making chips that are two generations beyond the chips needed now, to ease the squeeze felt in the automotive industry. Even the most conspicuous and emphatic solutions, it seems, are not enough, if they are viewed in isolation.
Where We Stand
Detailed analysis and a wide-ranging assessment are required to design the supply chain that assures your business of agility and resilience. The exacting details cannot, however, be allowed to obscure the big, conceptual picture, the future you might not yet have fully envisioned. In order to see that future, let’s firm up its foundation. A better understanding of how we got here can give vital information for how to move forward—and how to prevent going back. Some generalizing will have to be forgiven, to make the story clear.
The 1970s saw the end of low-cost, untroubled energy sources. The 1980s brought cost savings on inventory, in the form of just-in-time supply. The 1990s saw commitments to globalization and the rapid deployment of offshore manufacturing. Together, these ingredients make the present situation.
The Continuity of Supply
Providing your business with options is the key to offering reliable resources for supply and distribution. It’s a balancing act, and just as any gymnast achieves a form of execution that matches their own characteristics with the demands of the exercise, each business faces a different formula for arriving at the balance of advantage and reliability their supply chain requires.
Investment is needed to bring this balance into action. Circumventing transportation jams, boosting domestic supply capabilities, providing a prudent inventory to assure continuity—all three are typically essential parts of an overall answer.
Assisting with this investment is a role we, at Associated Bank, are privileged to play. Sharing our broad base of experience also provides our clients with real solutions. Let’s get together and discuss the answers that are particularly useful to you.
