Will supply chains be this disrupted ever again?
Many lead times have doubled, or even tripled. Right now, there’s an unprecedented shortage of paper for corrugated boxes thanks to the demand explosion in e-commerce.
How do you manage the chaos so you come out at least break even, hopefully profitable, and possibly your market’s leader?
Here’s some strategies to help you make it through:
1. Time to Completely Overhaul Your Supply Chain
It may be cliche to say, but it’s so true: necessity is the mother of invention. COVID-19 has taken any vulnerabilities in your supply chain and made them glaringly obvious.
That’s a bad thing in the immediate moment. But it doesn’t have to be for the long-term.
You can use this time to innovate and adapt your supply chain to the global shock caused by COVID.
And then you can be better prepared for any future disruptions. Companies who view this time as an opportunity to improve will find themselves at the head of their industry as the world returns back to normal.
This could include optimizing the use of IoT, robotics, and 5G in your supply chain.
2. Is It Time to Change Your Company’s Culture?
Believe it or not, centralized authority over decision-making can actually be a bad thing. The problem is that it can stifle growth and innovation.
Rather than developing creative solutions to a changing and never-before-seen problem, the same old thing is done.
What’s the problem?
Fear. Companies with this approach are afraid that the situation will lead to their total failure. They don’t allow smart risks. And they focus on control.
That only leads to maintaining the status quo at best…or significant loss of market share at worst.
Instead, the legendary business book Good to Great did meticulously thorough research and found that “operating with freedom within a framework of responsibilities” was the approach that led to historically great success.
Do you have that approach in your culture? If not, it’s time to take a look.
3. What Should You Focus On?
Consulting company Accenture recommends doing the following specifically to make the most of the disruption caused by COVID:
- Focus on the health and safety of your employees first so they can be optimally productive
- Maximize your ability to glean data from all aspects of your supply chain so you can make the right decisions
- Micro-segment your market so you can respond appropriately to demand
- Build a sales and ops emergency SWAT team that can quickly create and implement responses to fast changes
- Create what-if scenarios so you have actionable insights ready that will optimize company KPIs
It’s easy to say all this. But it’s much harder to do.
However, you now have a starting point. And the rest is up to you.
Best of luck to you as you navigate your way through COVID’s supply chain disruptions!