By Rahul Chokhani, Director IT – Supply Chain, Lowe’s India
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The outbreak of the COVID-19 pandemic has wrecked an enormous economic turmoil, leading to unprecedented stress on the global supply chains. While supply chain disruptions are not a very uncommonly occurring phenomenon in today’s business owing to natural disasters, geo-social events, or politico-economic crisis, the current pandemic, however, was unique in many ways. It was hard to anticipate, and it escalated very quickly – like a Black swan event!
Fortune magazine in fact, did a study on Fortune 1000 organizations and found that over 94% have experienced supply chain disruptions due to COVID-19. While it is not always feasible to avoid these disruptions, the business can still be better prepared to mitigate the risks and impacts associated with these. Here’s how:
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1. Invest in your people
The safety and well-being of its people and people around them must always be the top priority for any organization. It should start with their own employees and extend to contractors working for them and their business partners, their suppliers and consumers, and finally the community. Not only does this lay a foundation for a long sustainable business future that builds solid partnerships but also helps build trust and loyalty.
2. Use technology efficiently to improve the supply chain visibility and risk assessment
Technology is much more than just an enabler for retail and supply chain. Building the right tech solution for its supply chain provides an end to end visibility and traceability within an organization. Moreover, deep technologies such as ML and AI could be leveraged for predictive analysis, forecasting, and planning, helping businesses mitigate their risks.
3. Distribute the supply and suppliers for business continuity
As the supply chain ecosystem changes during such a crisis, business needs to work towards distributing the supply chain ecosystem to multiple geographies. It ensures the continuity of supplies, which can help sustain in time for any case. Eliminating single source dependencies and establishing a flexible and adaptable supply chain is what will help organizations survive and thrive in such times.
4. Make contingency plans
Organizations must perform risk assessments on different steps of the supply chain network and plan an alternate solution for each. Likewise, they must draw contingency plans to drive disaster recoveries during this time.
Supply chain ecosystems will continue to go through a ‘stress test,’ considering their business criticality and exposure to shocks – economic, political, social, pandemic outbreaks, weather events, among others. Businesses need to rethink and reimagine the supply chain, fundamentally, to reduce these challenges. In the immediate term, organizations need to go back to the basics, invest in human capital, make use of technology, and employ agile business practices to weather future storms.
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