We Must Learn to Mitigate Supply Chain Disruption from Disasters
While the coronavirus pandemic put supply chain weaknesses on display, it has also shined a light on where we need to strengthen our capabilities to mitigate future disruptions.
The onset of COVID-19 had a negative impact on various supply chains. Inventory stopped flowing from overseas suppliers to U.S. retailers and manufacturers just as consumer demand for essential goods spiked.
The trucking shortage we've all been trying to ignore asserted itself in the form of transportation bottlenecks and capacity shortages. Importers found themselves with empty warehouses as incoming shipments dried up, while exporters were stuck holding inventory and in desperate need of overflow space.
While the speed with which the supply chain was disrupted by the coronavirus pandemic put supply chain weaknesses on display, it has also shined a light on where we need to strengthen our capabilities to mitigate future disruptions.
Here are some areas the supply chain must address moving forward:
Workforce health and safety. Coronavirus showed us the supply chain needs to put more focus on the health of our workforce. Worker-related disruption can be mitigated in the future by implementing effective health and wellness benefits to support the ground-level essential workers that the supply chain depends upon.
Inventory management practices. The last decade has seen a dramatic shift toward Just-in-Time inventory practices and other methods to reduce storage costs. Moving forward, retailers, distributors, and manufacturers need to reevaluate their inventory practices and how they influence their ability to tolerate disaster-related disruptions.
E-commerce viability. E-commerce grabbed an increased share of the retail market and will likely hold on to it post-pandemic. However, it's worth noting even the big retail and e-commerce giants ran out of essential items relatively quickly. And when consumers turned to online grocery delivery while under shelter-in-place orders, they couldn't find delivery windows for days, weeks, or at all. Moving forward, it's essential that e-commerce players shore up their capabilities from distribution through the last mile.
Rapid response capabilities. Shippers and their logistics providers must develop the ability to respond to threats and disruptions by scaling storage or distribution space, implementing technology, optimizing vendor and carrier management, and more.
Optimization. When the supply chain is under consistent strain, it offers a prime opportunity to identify out-of-date processes, practices, technology, and equipment. Shippers and logistics stakeholders should already be analyzing data to find out what failed and what could have been done differently.
Technology. The supply chain sector has relied on technology to meet challenges for decades. We optimized routes and shipments with TMS solutions. We enhanced movement and picking in the warehouse with WMS solutions. We addressed labor shortages by supplementing existing workers with wearables and robotics. We will need to improve these technologies and create others to address the problems laid bare by this pandemic.
It's Up to Us
The health and safety of people everywhere depend on the ability of the supply chain to keep goods and emergency supplies moving in a crisis. The impact on the national and global economy has been catastrophic. As supply chain professionals, it's up to us to develop new best practices, processes, and technologies that enable us to bend under extreme stress without breaking. Supply chain volatility has been our new normal for awhile now—this is what we do.
For help with your warehousing and logistics needs, contact Phoenix Logistics today at phoenix3pl.com.