With holiday festivities right around the corner, the unpredictability of incoming winter weather poses a serious threat to supply chains that facilitate the seasonal uptick in commerce across many industries. Experts are predicting a "triple dip La Niña," as it is the third winter in a row that La Niña will shape the weather patterns across the U.S.
While we may be used to this annual juggernaut, this year winter comes amidst a risk environment that has never been more extreme or uncertain. According to a recent report¹, the top rising global risks threatening businesses today include both weather and transportation/logistics (supply chain).
The data is compelling: the number of large severe weather events has risen dramatically. For example, reports of blizzards (+197%) and avalanches (+202%) all tripled from 2020 to 2021, and tsunamis (+114%) more than doubled. And the risk involved in getting people and goods from Point A to Point B was up 146% overall in 2021, led primarily by spikes in railway accidents (+91%) and road accidents (+168%).
So, what does this combination of unpredictable weather and a dynamic global supply chain disruption right before the holiday retail rush mean for your organization? Let’s take a look:
Prepare for the Global Ripple Effect
As we’ve seen from the lockdown in China earlier this year, what happens in other parts of the world affects us here in the U.S. Disruptions faced by overseas suppliers have a severe impact on the ability of businesses here to build and deliver product. The world is interconnected, and there are cascading dependencies and contingencies that play into the broader “butterfly effect” of understanding and managing risk².
Russian hostilities in Ukraine also illustrate the point. Risk across Ukraine itself skyrocketed by 3900% on the day of the Russian invasion. The ongoing hostilities are relevant to Ukraine and Russia, but the effects of Russian aggression can be felt globally. Beyond the humanitarian crisis in the region, the world continues to experience sustainability, logistical and operational disruptions — particularly with Ukrainian grain exports and Russian oil and gas.
To mitigate the ripple effect of these global risks, preparation is key. In addition to an agile and forward-thinking management team, organizations need the power of artificial intelligence (AI) to strengthen resiliency.
The OnSolve Platform for Critical Event Management (CEM) powered by AI is able to rapidly analyze a vast spread of data that includes customer demand, existing bottlenecks and severe weather forecasts, both globally and locally. This means your organization can problem-solve in advance, rather than falling victim to sudden supply chain disruptions. Whether you have to find an alternate source, a different shipping route or an actual replacement material, planning ahead increases your chances of finding a literal port in the upcoming storms.
Take Advantage of Risk Intelligence, Sooner Rather than Later
Risk intelligence leverages AI to show you the combined impact of factors such as severe weather, global supply chain issues and local infrastructure outages on your particular operations. With this knowledge, you’ll be able to accurately determine what’s necessary to keep them running smoothly.
The seasonal surge in shopping can put a strain on carriers and routes that affects all types of organizations, not just those in the retail business. By pre-arranging temporary contracts with substitute suppliers and carriers, you can both reduce and budget for the high fees that are often associated with short-term emergency solutions.
Most importantly, risk intelligence provides your organization with verified intelligence faster. The ability to communicate in real time improves outcomes and helps mitigate factors that threaten your supply chain and, as well as improving your ability to strategize for how you’ll safeguard your people, places and property. When every minute counts, sending alerts to the right people at the right time goes a long way toward mitigating catastrophe. Advanced warnings enable everyone to take action to minimize threat - not only to your organization but to the communities it serves.
Develop Thorough Contingency Plans
Based on the information we have now regarding unpredictable weather and ongoing bottlenecks at critical ports, it’s crucial to be prepared to shift your productions. This is another area where a CEM platform can facilitate business continuity in today’s unstable atmosphere. Accurate predictions and instant communications mean you can increase capacity at alternate production centers before it reaches a non-recoverable low.
The same applies for rebalancing your carriers. With a well-distributed network and a reliable critical communications system, you can take the burden off overwhelmed carriers and alert those less-impacted that you need a temporary delivery increase. This prevents a single point of failure and keeps your products flowing. Remember, this is the time to be fluid.
Critical Communications Keep Stakeholders Updated and Assured
The more perilous the climate, the more important it is to reassure employees, customers, vendors and investors that you have a plan to stay ahead of the storm. Think through how you’ll handle these issues, and then make sure to relay your strategy clearly in different scenarios:
- Employee Shift Changes: When winter weather causes unsafe driving conditions, how will you adjust your schedule and communicate those changes to your staff?
- Vendor Shipping Modifications: What are your options when your air, ground, freight and shipping carriers are compromised?
- Customer Distribution Delays: How will you notify and mollify your customers when delivery is held up?
- Investor Returns and Company Profit Margins: Where can you make adjustments to stabilize your solvency?
- Regulatory Compliance: How will you document your actions during a critical event to satisfy legal requirements and local regulations?
The right CEM platform can help you answer all of these questions via real-time intelligence reporting. Get the information you need to improve your decision-making process and shore up your contingency plans. A critical communications product lets you relay your plans swiftly and efficiently to everyone. Create templates for instructions and pre-fill them in advance, along with all of your targeted contact groups. That way, when the time comes to take action, you’re poised to pivot.
Want to learn more about mitigating risk and strengthening resiliency during the winter season? Request a demo today.
Winter Weather Preparedness Kit
Are you prepared this year? Use this resource center for expert guidance and helpful tips to protect your people, places and property and keep operations moving this winter.
