In the previous blog post, we posited three questions and summed up the measures you can take in response.
- Adopt a strategic approach: Create a supply chain strategy which requires functions and geographies to align their goals to the fulfillment of the organisation’s supply chain strategy.
- Create your ideal state, resilient and fit-for-purpose supply chain: Model it based on demand, obtain buy-in, then build it. It might take one to three years to rebuild it completely. Make sure your strategic approach carries through to your suppliers and your products. (This means that you will not be in the position of single-sourcing strategic products, nor will your portfolio be full of non-strategic products or loss making products in times of disruption.)
- Make sure you have your digital supply chain strategy in place: There’s already a meme going around about who digitised your organisation: the CEO, the CTO, the CIO or Covid-19? Like it or not, you won’t get another chance like this one, so get on with it!
- Be more proactive and less reactive: A proactive supply chain is already sustainable and has governance in place for risk mitigation. (It’s not scrambling at the last minute to make things work.) It’s important to accept that things will always go wrong in the supply chain. But with a strategy and a plan in place, it’s easier to know how to fix things in a way that supports the organisational goals and objectives. Don’t forget the following tools and tactics that can help you in that regard.
- Use the data you have: Remember the toilet paper situation we had covered? What data do you know that you have in your organisation that you are not using? Go a step further here, though and remember that your MRP and DRP systems are simply refilling the supply chains. They are not going to help you recover. Furthermore they are going to make issues such as ‘the bullwhip effect’ even worse. You will need human intervention, but it’s better to just pay attention to your demand data better and avoid the issue of panic buying in the first place. This doesn’t mean we ignore legitimate increases in demand as the result of an extraordinary product that everyone wants.
- Make informed, fact-based decisions: Get the facts and then make your decisions. Gut-feeling supply chain management simply doesn’t work anymore. Your gut isn’t the one doing the work of co-creating something that has not existed before. In fact, making such decisions during the Coronavirus crisis and in the world that comes after may well be counterintuitive and drive you into a non-competitive supply chain position. If anything, your subconscious/gut will only re-create a supply chain of old that is just set up to fail.
- Timing issues: This one is linked to using data. Let’s go back to the toilet paper scenario – here we saw panic buying cause a disruption to demand which affected supply. Recovery seemed to take a relatively long time (spanning a few weeks). Here’s where the supply chain’s ability to recover is out of sync with the demand requirement. This is a key issue for us in building new supply chains.
- New technology: Take a good look around at all the new technology that can help resolve some of the age-old issues in your supply chain. For instance, remote working is a wonderful opportunity to look for better team-based technologies as a start. And while you’re at it, consider looking at better AI technology as well. Imagine an AI bot that handles the same phone calls that your PA or receptionist handles in times of excessive demand? Or, what about an AI bot that analyses your demand data and alerts you to panic buying in any items or product? We haven’t even touched upon wearables linked to our new COVID-19PPE!
What are the obstacles to this change?
Change is scary for everyone. Thus, education and change programmes are required to help organisations ease in. No longer is the idea that we ‘can’t be disrupted’ a viable reason to not proceed, but anxiety and attachment to the past can really impact people’s decision-making skills.
We should not act as if everything will get back to normal and that this is merely a one-in-a-hundred year event that took everyone by surprise. Lead times for everything are collapsing. Who is to say lead times to the next major disruption won’t be much less than 100 years?
The true upside is that we’ve managed to weather it so far, and thus why we should not hesitate to look at what we might do differently and better next time!
It’s truly an exciting time and the future for supply chains is wide open!
it’s time for us to prepare supply chains for a new world after Covid-19!
So, are we as supply chain leaders going to make this unprecedented opportunity work for us, our organisations and our careers?
Have you decided on what you’re going to do differently, and how will you do it?