COVID-19 has proven that companies need to rethink the traditional operational platform approach and recognize the urgent need to become more flexible and contingency-focused. The pandemic has highlighted underlying weaknesses in business strategies, gaps in complex planning, and communications challenges that prevent meeting customer demand.
It is more important than ever to have a rapid mobilization strategy and end-to-end integration. This may be the opportunity to use current events as a catalyst for strategic advancements. Major disruptions are the biggest challenges for every supply chain. They test resilience, flexibility, collaboration, and planning capabilities.
Companies need to assess end-to-end supply-chain readiness with questions such as:
- Should you re-position your inventory?
- What production constraints should you adjust?
- Should you remap your item-level segmentation?
- How can you develop probable scenarios and determine their validity?
- Who can you work with to establish protocols?
- How and where do you utilize complex data-modeling capabilities?
- Is integrating market and social-media information important?
- What new metrics should you implement and review?
- How can you effectively communicate with both tier-1 and tier-2 suppliers?
- How can you proactively connect with your customer base and understand potential shifts in sales-channel behaviors?
Companies should drive resilience in their supply chains through documentation, automation, and innovation. They should also have a strong disruption recovery plan, and that needs to start now. Begin by reviewing processes and protocols to identify what can be automated and integrated into daily routines.
It is also about having a business-continuity mindset, and how you scale it in times of disruption. Identify the next steps in developing and supporting digital end-to-end visibility. It may mean gathering the tools and capabilities to support flexible data modelling and visualization.
Many companies will also be figuring out if they need to diversify their supply and logistics base. COVID-19 meant a key exporter was shut down for several months, and that required pivoting to find new suppliers or dealers to get product. There is also the need to look at the benefits of advanced allocation and prioritization.
Taking the opportunity to build a more agile supply chain today will mean better responses in the face of disruption. The weaknesses exposed by the current situation will not limit you in the future if you take action today.
Cyndi Lago is Vice President at Capgemini Invent. She advises clients on supply-chain execution strategy and digital transformation. Connect with her on operations management, e-commerce, analytics, and strategic planning.