A recent arctic storm throughout much of the United States has reminded everyone how fragile the overall infrastructure can be, particularly with logistics. Nearly all businesses are affected by another business for one thing or another. A common spot for one small hiccup to snowball into an avalanche is the supply chain, as the recent storm has demonstrated. Prior to this, COVID-19 put a lot of production and logistics to a halt. Supply chain planning is vital to the success of any company hoping to weather a storm.
Supply Chain Planning Basics
The essence of supply chain planning is being able to coordinate the transformation of raw material into a product for a consumer from the beginning to the end phases. It is often broken into a few categories:
- Supply – ascertaining the resources of what will be used;
- Production – determining how to turn the resources into a product; and
- Demand – determining how to move/market the product.
For example, a boutique designer would ideally have a system for monitoring supply sources (such as fabric, zippers, etc.), the production processes (what happens as each of those items becomes clothing and how long it takes), and how to get the finished product to the market, be it their own shop, consignment, or all online.
Reintroducing some of the most recent nationwide dilemmas, the weather and COVID-19, it doesn’t take much to break a chain. Alone, each of those major issues can lead to major delays in transportation. Combined, the effect has already been recognized. If the designer in the above scenario ordered from a factory that was temporarily closed during the pandemic, that could have resulted in lost sales as customers are forced to shop elsewhere.
Pandemic Supply Chain Planning
Many businesses have already faced the impact of the current economy and have adapted to survive. Taking inventory of the businesses that have done so, Long & Wendel have noted the similar strategies that were used in maintaining their supply chain.
With as much time as people spend worrying about the worst-case scenarios, it doesn’t hurt to actually plan out what to do for any given scenario. Many people will wrestle with the anxiety of what might happen only to actually face that situation but not be ready to react. Have that secondary plan ready, as well as what to do if that doesn’t work.
Focus on Current Customer Needs
When economies hit a rough patch, customers’ needs change. This includes businesses as customers. For a business to be able to stay afloat, despite its needs, it must focus on how to satisfy the needs of its customers.
Draw on Experience
If something similar has happened in the past, it is time to reflect on the lesson. How was it handled before? Did that work? If not, that’s still a step in the right direction for this time.
It is imperative to monitor performance in order to know if what is being implemented is even working.
Can Technology Help?
Because of technology, never has more power been at the individual fingertip. Certain features that were once just a nice convenience are becoming an irreplaceable aspect of the tech. Not only is it being used to track the progress of an item in a supply chain, but data analytics can increase the efficiency of supply chains through data validation; detecting anomalies; and inventory management.
Supply chain planning is more than just knowing where to buy material. Because of how important it is for any business, the planning must evolve as much as the supply chain.