The novel coronavirus (Covid-19) made sure to keep retailers on their toes with a high surge in demand when people ran to stores in order to have supplies for their quarantine days, creating a once-in-a-generation test for business continuity planning and supply chain flexibility. How should retailers deal with these types of urgencies?
Even though companies have analytical relevant tools, such as forecast and prediction tools, when it comes to urgency scenarios, not even those are enough. They need be able to quickly react to constantly changing conditions across their end-to-end supply chains, make plans and decisions, and take the necessary actions – so that retailers can deliver vital goods and services (in the right places, at the right times and at the lowest cost).
Decisions made in such critical times need to be reactive and proactive: reactive to ensure business continuity and proactive to make the necessary changes for better meeting demand and shorten the distance of supply chain elements.
Decisions made in such critical times need to be reactive and proactive.
Let’s start by thinking of a supply chain from end-to-end: there are suppliers, fulfillment centers, transportation services, stores and the inventory management policy, the maestro of this whole orchestra.
Since each of these elements will be disrupted by this surge, the main goal is to understand how to shorten the differences between elements, thus accelerating the supply chain and enhancing overall communication.
When considering suppliers some crucial questions for decision-making arise, such as:
Afterwards, in fulfillment centers which will be stressed even if suppliers are not affected, the focus should be:
Getting every product from a warehouse to a store is a crucial role performed by transportation.
Major questions for transportation managers should be:
Being stores the critical connection checkpoint between the supply chain and its customers, the focus should rely on the following:
The supply chain managers challenge is to decide which questions their focus should rely on.
And finally, the wheel that keeps everything in motion – the inventory management policy. Here, the main questions should be as follows:
All these questions should always rely on the minds of every supply chain manager.
However, since the world is always changing and due to its unpredictable characteristics, managers don’t have enough time for making clear decisions, but instead have days or even hours for dealing with critical matters of their supply chains.
There will never be enough time for structuring and thinking supply chains from end-to-end since the surrounding scenarios are always changing. The main challenge that supply chain managers now face is to think about which questions their focus should rely on.
By: João Alves