The COVID-19 years showed us that the worldwide supply chain was unprepared for the global disruption that defined 2020 and beyond. Recovery was a challenge for most, as they scrambled to address old problems alongside a host of new ones.
When COVID exposed those weaknesses, businesses were forced to reevaluate how they prepared for disruption. Many realized that they could no longer address issues in a vacuum, but instead had to assess risk holistically, looking at the entire supply chain as part of their strategy.
Tom Strohl, a business advisor with Oliver Wight Americas, Inc., describes supply chain strategy as an all-encompassing web. “It’s all connected together,” he says. “If there’s a problem in one spot on the web, it vibrates, and you can feel it in the other areas on the spider web.” For instance, if a forecast is biased, you’ll feel the implications of that in production planning, supplier scheduling, distribution requirements, and even in inventory. And because everything is tied together, he says, that issue with inventory is going to be felt further down the web.
How, then, can companies start managing this complex supply chain in today’s world? Peter Alle, also an Oliver Wight business advisor, suggests businesses start by developing planned agility, as opposed to forced agility. While companies with forced agility might be able to react to disruption when a crisis occurs, those with planned agility are able to predict and prepare for disruptions before they even happen.
By building planned agility, companies can become more equipped to navigate the unstable supply chain that defines our post-pandemic world. “What this means is we need more control over what we’re doing, not less. More discipline, more decision-making, more information, more formality and more accurate and transparent data,” says Strohl. To achieve this, both Alle and Strohl believe companies need to focus on master data, inventory and integrated business planning (IBP).
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