How Has COVID-19 Affected the Supply Chain Management Functions of Organizations

How Has COVID-19 Affected the Supply Chain Management Functions of Organizations

The effect of COVID-19 is being felt globally across industries and operations in ways that we are increasingly finding difficult to model as well as assess. The sector that has been amongst the most affected has been the global supply chain. Organizations today find that hard data is lacking, the concerns over depleting stock are mounting, there is that fear of not being able to meet contractual obligations on time.

The Three Shocks Faced by Supply Chains

In the beginning, there were ‘supply shocks’. Companies all over felt disruptions to the availability of both finished goods and raw materials that were to be sourced from China.

As the pandemic crisis deepened, we had nations instituting lockdowns, with people hoarding on things in order to comply with the restrictions on movements, therefore sending the supply chains into systemic demand shocks.

Third, we say, are the aftershocks, or as many would call it, the bullwhip effect. It means a small increase in consumer demand leading to a huge spike in production at the manufacturer or the packaging supplier level. Whether or not the bullwhip shall strike now, is rather an important question!

Looking for Ways to Improve Your Supply Chain

The fourth shock will be the ‘new normal’ that we are approaching. The economic impacts are starting to be felt, and a lot of economists are predicting a post-pandemic deep recession that could last any length of time.

It is not surprising to see that the turmoil surrounding this pandemic has put business and organizational supply chains firmly under the spotlight. While everyone is already taking certain steps in the right direction, there is a strong need of having a strategic game plan in place. And it all starts when you invest in the right technology. Microsoft Dynamics 365 Finance & Operations has been helping both partners as well as organizations with optimizing their supply chain and providing a strong foundation to deal with the ‘new normal’ that is undoubtedly going to follow COVID-19.

How Has Dynamics 365 Been of Help?

It, first and foremost, helps improve the accuracy of sales demand forecasts which are critical for reliable and efficient supply chains. D365 Finance and Operations harnesses the power of Azure ML in order to analyze the individual product sales histories. It then automatically trains itself to choose from 5 advanced statistical forecasting models based upon minimizing forecast error.

Dynamics 365 F&O provides tools to help companies identify their physical capacity constraints and accordingly plan their use so that they can maximize their throughput while minimizing the cost. It further enables the strategic suppliers of companies to have controlled remote access to their ERP system as well.

In addition, D365 F&O offers automated methods to dynamically calculate the appropriate statistical safety stock levels for every individual product and group of products, based upon the variation in their demand as well as the desired service level percentage. This helps businesses in continuously tuning their inventory profiles so as to achieve the best trade-off between inventory holding costs and customer service.

In Conclusion

These are just a few ways how Dynamics 365 Finance and Operations has been helping optimize the global supply chain as we approach the ‘new normal’. To gain more information on how D365 has been playing a prominent role in getting varied industries and their supply chains on track, please write to us at, and we’ll write back to you!

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