Antifragility can transform how supply chains perform in uncertain times in support of a growth agenda. Antifragility provides the ability to gain because of exposure to uncertainty. The bigger the uncertainty exposure, the more opportunity to gain.
A Gartner survey of 164 supply chain professionals in June 2023 revealed that 28% of supply chains expected no gain or loss in revenue, while 63% of respondents expected a loss of revenue due to exposure to uncertainty (see Figure 1).
“Rather than trying to keep uncertainty out of the supply chain, antifragile supply chains embrace uncertainty with the objective of learning, evolving and adapting their capabilities based on their improved knowledge of it.”Tim Payne
Gartner’s analysis identified a select group of antifragile capabilities for Chief Supply Chain Officers (CSCOs) to deploy that are 2.1 to 4.9 times more likely to gain revenue for their organisations when confronted with uncertainty.
Figure 1: Supply chain professionals’ estimated impact of uncertainty exposure on revenue
Payne opines that the inability to cope with uncertainty is driven by a misallocation of initiatives to the wrong strategy. He noted that in the survey nearly half of respondents said that more than 50% of their supply chains’ key capabilities are set up to attempt to keep uncertainty outside the supply chain. “This overinvestment in a barrier to keep uncertainty out stifles the ability to learn from it, keeping most supply chains today in a fragile state,” he added.
Antifragile capabilities to cope with uncertainty
CSCOs must assess their current ability to cope with uncertainty so that appropriate strategies can be applied to evolve towards the antifragile supply chain state. Gartner’s research shows that supply chains can be in either a fragile, resilient or antifragile state. While resilient supply chains may not lose during periods of uncertainty, the focus remains on keeping most uncertainty out, reducing the ability of organisations to learn from it often leading to “resiliency fatigue.”
“An antifragile mindset changes how CSCOs approach and shape their capabilities, including in areas such as integrated planning, ROI calculations, supply chain redundancy and assessing uncertainty,” said Payne. “Our research shows that a select group of antifragile capabilities are especially effective in moving a supply chain into the antifragile state.”
Gartner’s analysis of the survey data revealed the top six antifragile capabilities that are highly significant in driving a supply chain towards gains during uncertainty. These antifragile capabilities lead to a significantly greater likelihood of positive revenue gains when exposed to uncertainty, compared with the fragile or resilient versions of these capabilities.
Most impactful antifragile supply chain capabilities
Decision processes and collaboration: Enabling dynamic decision processes during uncertainty (4.9x more likely to have a positive revenue impact).
Calculating ROI for supply chain investments: Assessing the value of investing at different times due to uncertainty (4.5x).
Managing the assessment of uncertainty: Performing a high degree of experimentation on the supply chain to stress test it (3.7x).
Supply chain redundancy: Viewing redundancy (e.g., inventory, capacity, multiple suppliers) as an investment opportunity (3.6x).
Supply chain planning: A focus on end-to-end (E2E) planning policies (probabilities, options, thresholds) in the midterm and accurate functional short-term planning (2.5x).
Monitoring, adjustments and responsiveness: Monitoring at “arm’s length” to intervene only if policies are breached and empower local stakeholders to adjust within policies (2.1x).