New Supply Chain Strategies for a New World
Listening to media reports in relation to the coronavirus crisis from around Europe today, we can be cautiously optimistic that there is now some light at the end of the tunnel. However, there is still a long process ahead over the coming weeks and months. Firstly, a process of grieving for those lost, as well a process of physical and psychological recovery for survivors and front-line workers. The return to normalcy will no doubt be gradual and staged with some measures remaining in place to guard against future reoccurrences, while treatments, tests and vaccines are developed and deployed over the next 12 to 18 months. Countries like Austria and Denmark have begun to lift some restrictions and no doubt will be the scouts who develop the best practices that other European countries will follow.
Likewise, businesses will now be turning their attention to considering what strategies they will need to formulate and implement to survive and thrive as the post-COVID19 world emerges. Many will have been reminded very sharply through this crisis what their values are and what the true reason, or driving force, for which they exist at all really is. This will have helped to make their mission more relevant and real to everybody in the organization as they will have been working a renewed awareness and sense of purpose over these last weeks. This has provided a great opportunity for leaders of organizations to reconnect organically with those values, driving force and mission, which are constant and unchanging, to develop new pragmatic strategies to suit the new world that is unfolding.
Of course, not everything will have changed, the need to be effective and efficient will remain, the challenges that existed before in relation to climate change, demographics and technology will still be there. But what will have changed is people’s sense of what is possible and people’s willingness to consider and try new ways of doing things. I suspect that the next two years will be a time of great expansion in creativity and innovation in business as these after-effects feed through and the best equipped businesses find new and novel ways to harness them to thrive in the future.
Some of the major changes that I see coming through that will impact strategic thinking in businesses large and small will be sparking creativity and new opportunities will include:
- A greater focus on prevention over contingency in relation to risk management and business continuity planning.
- A reorganization of long, lean, global supply chains into more regionalised networks with built-in redundancy.
- Increased diversification of supply options for critical materials and inputs and streamlined supplier approval processes in highly regulated industries.
- A trend towards increased importance of security of supply over optimization of inventory and working capital.
- Accelerated deployment of technology for the automation of processes and remote working.
- Accelerated deployment of automation in manufacturing, distribution and logistics services provision.
- Raised and converging standards internationally on food production, processing and handling and particularly in relation to animal husbandry and welfare.
In subsequent memos we will look in more detail at some of these and other topics where opportunity is emerging from the danger. In the meantime, please feels free to contact me directly to discuss how I can help you to formulate and implement your future strategies to thrive in the post-COVID19 world on email@example.com or +353 86 811 6030.