Trust in supply chains | Deloitte Netherlands


Is your supply chain trustworthy?

Executives overestimate customer trust in supply chains

Executives can overestimate customer trust in their organizations’ operations. Here’s how they can close that gap to help build more reliable supply chains and enhance financial performance.

Supply chain executives significantly overestimate stakeholder trust in their supply chain capabilities and intentions according to a new Deloitte Insights survey report titled “Is your supply chain trustworthy?”. Of more than 1,000 executives from large global organizations, 89% who self-identified as leading suppliers said customers trust their supply chain operations. That while just 68% of roughly 500 customers said the same. In looking more closely at the divide between executives self-identifying as leading suppliers versus customer perceptions of supplier trust, the gap was highest when measuring reliability in supply chains, followed by humanity, transparency and capability.

Is your supply chain trustworthy?

 A research by the Deloitte Center for Integrated Research (CIR)

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The impact of Trust

Trust is crucial for organizational resilience, growth and for navigating in the complex market conditions. But, building trust is not that easy. Supply chain leaders overestimate trust levels with customers, employees, and vendors. That while the supply chain ecosystem often must deal with disruptions; 77% of the surveyed leaders experienced disruptions in the last year. These disruptions lead to significant financial and reputational costs; over 6-10% loss of annual revenues and a damaged brand reputation. In addition, a disruption decreases trust from internal and external stakeholders. Strikingly, leading organizations working to identify and prioritize actions to enhance and build trust, have a better business performance. Here trust serves as a competitive differentiator.

The supply chain trust gap

The research implies that the supply chain trust gap is far bigger than our responding executives seem to realize, suggesting there are blind spots in key areas their customers care about. From the customer perspective, many COVID-19 pandemic-era supply chain challenges remain unresolved, despite improvements executives have worked hard to achieve. Unfortunately, such wide gaps in trust indicators like reliability and transparency against pre-pandemic expectations stand to worsen as new supply chain risks emerge: nearly half (44%) of all supply chain executives surveyed expect to experience a supply chain shock in the next 24 months as a result of various external challenges including price volatility (46%), inflation (44%), resource shortages (e.g., labor and materials; 42% and 41% respectively), and geopolitical instability (32%). Executives ranked external challenges similarly across regions; however, those in North America were more likely to cite financial market instability and inflation as their primary challenge compared to Asia/Pacific (AP) and Europe/Middle East/Africa (EMEA) where price volatility was top of mind for supply chain leaders.

Closing the gap

With the potential for distrust to grow amid uncertain market conditions, it’s increasingly important that supply chain leaders find a way to shrink the gap. Leading organizations working to identify and prioritize actions most likely to enhance the reliability and predictability of their supply chains — ranging from developing a digital thread to investing in other, advanced technical capabilities to help earn stakeholder trust, enhance business performance, and serve as a competitive advantage.

Get in contact

Want to learn more about how to become more resilient and how to build a more reliable and trustworthy supply chains? Please do not hesitate to contact Frédérique Demenint  via their contact details below.

Read the full Deloitte Insights article on how to close the trust gap here.

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