3 ways AI can enhance supply chain visibility against tariff exposures

Businesses are exploring reshoring as a strategy to mitigate tariff exposures. However, companies may face challenges to gain full visibility into their complex supply chains amidst evolving trade policies, hindering reshoring efforts and increasing the risk of potential business interruption.

Artificial intelligence (AI)-powered solutions can help companies reshore with confidence by rapidly assessing how their supply chain network will be affected under current and potential tariff scenarios.

How AI can help to reshape your supply chain network to navigate trade barriers

Sentrisk, Marsh McLennan’s proprietary AI-powered platform, is designed to enhance your supply chain visibility and resilience via real-time data and analytics to help your business navigate complex global trade environments effectively in 3 ways:

1. Rapid multi-tier supply chain mapping

Traditional supply chain mapping requires manual surveys that are expensive and time-consuming, and adding tariff exposure analysis only compounds these already significant challenges.

Challenges in manually mapping supply chains

A global automotive company invested in over 200 employees and millions of dollars across four years yet only achieved 40% visibility into their tier 2 suppliers through manual surveying methods.

Using an AI tool like Sentrisk, armed with geospatial satellite technology, can quickly help you identify upstream suppliers (including tier 2 and 3 suppliers), network structures, and risk exposures within hours based on the flow of goods between countries, trade routes, real-time shipping data, the latest tariffs implementation, and more.

Uncovering supplier sites in 48 hours

A manufacturing company with limited visibility beyond tier 1 suppliers discovered 900 additional supplier sites, including over 300 upstream suppliers, within a short 48 hours by using Sentrisk.

2. Identify tariff exposures to inform mitigation strategies

Sentrisk empowers your company to assess the potential impact of supply chain disruptions, including trade actions and specific tariffs. It provides detailed maps that highlight vulnerabilities at site, supplier, and component levels, categorised as low, medium, or high risk:

Identify key risks: After mapping your supply chain, Sentrisk can pinpoint critical risk areas, such as the impact of tariffs on your business with our tariff simulator.
Evaluate tariff scenarios: Sentrisk contextualises your exposure to current and potential tariff scenarios, focusing on their most significant effects and offering actionable insights.
Assess exposure quickly: The simulator allows your business to swiftly evaluate your exposure based on supply chain, tier type of goods, and individual supplier relationships across various routes. It is regularly updated with the latest tariff information, ensuring it remains dynamic and flexible.
Incorporate spend data: To simulate future scenarios, spend data can be integrated into Sentrisk, enabling quick financial impact assessments and detailed analyses of the most affected supplier relationships, considering both immediate and upstream tariff exposure.

Sentrisk reveals trade action scenarios impacted by tariffs

An automotive company utilised Sentrisk’s advanced analytics and simulations to assess how trade actions impact its supply chain. They identified multiple vulnerable points for caps and thermostats where proposed tariffs would create cascading effects through their supply chain.

The manufacturing company in the previous example uncovered previously unknown supplier concentration in a location and discovered that 50% of these suppliers were located in the same flood-prone river area, which created vulnerability for four key components across major product lines for the business.

3. Real-time disruption monitoring and management

Sentrisk aggregates data from numerous sources to provide immediate updates on potential disruptions – from natural disasters to political events – enabling proactive response strategies that boost efficiency throughout the supply chain.

Enhance your supply chain visibility against tariff exposures with Sentrisk

With our in-depth global experience across industries, Marsh Asia’s expert advisors understand your business, and we are here to partner with you to navigate the current uncertainties and volatility. We aim to help our clients act swiftly and decisively using AI technologies combined with our knowledge.