If goods cannot be delivered on time or at all, quick action is crucial - 76% of manufacturers in Germany are confronted with disruptions to their supply chains several times a year. For the majority (82%), it is ideal to be able to respond to a disruption within two to three days or faster. At the same time, 75% expect artificial intelligence to help better manage supply chain disruptions and minimize risks. This was the result of a survey conducted by Kinaxis, in which 112 supply chain managers in German manufacturing companies with an annual turnover of at least 200 million euros were questioned.

While 35% of German manufacturers say they have a real-time overview of all departments and can immediately identify which departments in their company are affected by an unexpected disruption, others struggle to gather information in a timely manner: 31% of respondents said it takes several hours to gather their compartmentalized information and for 22% it takes several days - further extending the time between impact and response.

AI can reduce surprises in supply chain planning.

© Kinaxis

"In addition to the visibility of when and where a disruption has occurred, most companies lack transparency regarding the actual impact on their business," emphasizes Martin Bilstein, Regional Vice President for the DACH region at Kinaxis. He specifies: "When a disruption occurs, not even half of manufacturers can understand the resulting costs (40%), and only about one in three (29%) can understand the CO2 impact. Given the increasing pressure for transparent ESG targets and reporting, this is a remarkably low number of companies."

The data also shows that companies in the manufacturing industry are still a long way from being able to respond to a disruption in real time: If a natural disaster or major maritime bottleneck - such as the Suez Canal incident in 2021 - were to cause extended delivery times, only around 13% would be able to respond within a few hours.

AI can support risk management

As developments in the field of artificial intelligence (AI) continue to dominate discussions, optimism about its ability to mitigate risk is justified. According to the survey, attitudes towards AI depend on companies' own ambitions and existing capabilities, regardless of industry. Almost one in five manufacturers in Germany (17%) believe that AI still needs to improve itself. "AI is therefore not seen as the holy grail for optimizing transparency in supply chains. Instead, it is more of a useful additional tool that can help to improve processes that are already working well," says Bilstein.

Risks that influence the supply chain

© Kinaxis

Beyond the discussion surrounding AI, more than a third of manufacturing companies in Germany expect international conflicts (31%) and the resulting energy prices (39%) to have the greatest impact on their supply chain in the next five years, closely followed by raw material shortages (35%).

"In order to be able to react quickly to crises, companies need to introduce robust processes," explains Bilstein. "This is where interlinked planning comes into play, which links each individual element in the supply chain with all other elements end-to-end. A change in one part of the chain triggers a corresponding reaction in the rest of the chain - and thus allows the current status and the consequences of changes to be monitored in real time. The survey shows that fast action and well-founded decisions based on the right data are still a problem for the majority of companies. Interleaved planning combined with AI, heuristics and optimization can help to remedy this and ensure that supply chain managers are equipped for the challenges of today."

Survey methodology

The survey was conducted among 112 supply chain managers in German manufacturing companies with an annual turnover of at least 200 million euros. Sapio Research conducted the interviews online in October 2023, using an email invitation and an online survey.