What is a consequence of poor supply chain agility?

The inability to respond to market demands is a critical consequence of poor supply chain agility. Agility in the supply chain refers to the capability to quickly adapt to changes, including fluctuations in consumer preferences, market trends, and unforeseen disruptions. When a supply chain lacks agility, it struggles to respond timely to these changing demands, leading to missed opportunities and customer dissatisfaction.

For instance, if a company cannot swiftly adjust its production or logistics processes to meet an unexpected surge in demand or sudden shifts in purchasing behavior, it may either overstock or understock products, resulting in lost sales or excess inventory. This inability to adapt can ultimately harm a company's competitive position in the market.

In contrast, the other options presented do not align with the effects of poor supply chain agility. Reduced software implementation costs or increased employee productivity are generally seen as positive outcomes of effective operational practices and do not impact agility directly. Higher inventory levels can result from poor supply chain practices, but they do not inherently represent the agility issue; instead, they could be a symptom of over-preparation or mismanagement within the supply chain rather than agility itself.