How do you prioritize inventory levels to mitigate the impact of supply chain disruptions on customer orders?

To mitigate the impact of supply chain disruptions on customer orders, prioritize inventory by focusing on critical items and maintaining higher safety stock levels for them. Example: During the COVID-19 pandemic, many companies in the medical supply sector increased safety stock for high-demand items like PPE (personal protective equipment) to ensure they could continue fulfilling orders despite supply chain interruptions.

Using a pull inventory policy to manage safety stock is about balancing responsiveness with efficiency. In my experience, keeping safety stock under this model means closely aligning inventory with real-time demand signals. Instead of guessing future needs, we let actual orders trigger replenishment. This reduces excess inventory while still maintaining a buffer for unexpected spikes in demand or supply delays.

In 2020, during the height of the COVID-19 pandemic, Porteo Group faced unprecedented challenges in managing inventory. With supply chains disrupted and demand fluctuating wildly, manual prioritization became nearly impossible. That’s when we decided to invest in advanced inventory management software. This software automated the prioritization process, analyzing real-time data to recommend optimal stock levels. It alerted us when to reorder or when stock was low, ensuring we maintained a lean inventory without running out of high-priority items. This technology was crucial in navigating the chaos and keeping our operations smooth.

Businesses need to continually assess where their priorities lie, as these can shift with market trends, customer demands, and internal growth. As different areas of the business mature, the balance between minimizing stock and ensuring availability often changes. Regularly reviewing safety stock levels, supplier performance, and demand variability is crucial. It's less about a single policy and more about a responsive approach that evolves with the business's needs and capabilities.