In 2020, COVID-19 profoundly changed procurement, tearing apart global supply chains and forcing organizations to rebuild sourcing strategies overnight. In 2022 the war in Ukraine triggered major volatility across energy, agriculture, and metals markets. Now, renewed conflict in the Middle East is reshaping commodity markets and supply routes once again.
Global disruptions that used to be one-offs are now everyday norms, and preparing for the next event is a fundamental requirement if you want to build resilient supply chains and procurement teams.
So, is your organization crisis ready?
8 steps to crisis-ready procurement
Crisis-ready procurement doesn’t just mean reacting faster, it means having the foresight to know how you will react before a disruptive event is triggered. These eight steps will help you move from simply monitoring disruption to proactively navigating it.
For specific examples of what these steps look like in practice, download the executive guide: Crisis-ready procurement intelligence.
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Bring the big picture into focus
Crisis-ready procurement starts with a clear view of global events. Look for a platform that offers detailed daily event overviews and their projected downstream impacts. When you can see what’s around the corner, you can make informed decisions to weather it.
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Map out global exposure, so you can focus on the right areas at the right time
Global events don’t happen everywhere all at once, but their impacts do quickly cascade outward from their primary region. To respond to factors like conflicts and extreme weather events, you need a clear view of where disruption will occur. You need to know the specific risk exposure in the regions you operate in and along your shipping routes.
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Analyze upstream and downstream impacts on freight and energy markets
It’s crucial you don’t just focus on the region affected by disruption events itself, but also the commodities and logistical challenges associated with it. For example, conflict in the Middle East is affecting local trade routes and limiting access to major oil-producing areas. All of which will have knock on effects for energy and freight markets.
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Project price changes and prepare for multiple scenarios
Knowing what’s happening in real time is fundamental for crisis-ready procurement, but what if you could take it a step further and prepare for the effects of those events in advance? While no one can predict the unpredictable, you can model multiple price scenarios and make thorough plans for each. Then, once it becomes clear which is most accurate, you can immediately put those plans into action.
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Pinpoint commodity-level risks
High-level risk visibility and insight only go so far. Once you have established a clear overview you need to go deeper and get granular insights into commodity-level risks. The most valuable insight will be tailored to your sourcing locations and categories, and will show you the most important areas to direct your attention.
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Use your commodity-level view to look ahead
Dynamic heatmaps showing individual risk levels will help you act quickly and effectively when disruption occurs. But to continue making informed procurement decisions long term, you need an end-to-end view of commodity risk. That’s what will help you build more strategic global response plans.
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Convert your insight into informed strategies and actions
With granular insight and specific projections for future prices and supply scenarios, you’ll have everything you need to build a new “big picture” of what’s coming. You can then convert your intelligence into sourcing strategies and precise actions for category managers.
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Keep everything updated, all the time
None of these should be one-off exercises. Conflicts, geopolitical instability, and extreme weather are all continually evolving pictures. Which means your procurement intelligence must keep evolving too.
Turn crisis-ready principles into an everyday practice
These eight steps hinge on a few critical factors: constant visibility, expert data interpretation, and proactive planning. So how do you achieve that? Crisis-ready procurement requires continuous data gathering and interpretation, reforecasting, and scenario modelling to keep you ahead of what’s next. While that’s a huge amount of work, it’s essential if you’re going to keep on top of disruption. With end-to-end procurement intelligence platforms, like Amplifi PRO, you can easily get procurement insights and intelligence in one continuously evolving platform.
With tailored conflict exposure dashboards that highlight key insights across your organization’s highest-spend categories and supply chains, you’ll know where to act and exactly how to respond. Plus, with deep commodity insight, procurement teams can immediately see which categories in which geographies they need to focus on to ensure business continuity.
Amplifi PRO combines AI-powered intelligence, analyst expertise, and deep category insights to enable faster, smarter, and more confident decision-making. It also offers recommended next best actions which significantly cut manual analysis time and enable decision-makers to act on supply risk immediately, rather than manually drawing their own conclusions from vast quantities of raw data.
To explore crisis-ready procurement intelligence in more detail, and to find out whether you’re prepared for disruption, download the executive guide.