Last week we addressed whether supply chains could ever return to normal. We concluded that many obstacles exist that can block a return to normal.
Now, we’ll examine the alternative view of the Humpty Dumpty tale. That version goes like this: “Humpty Dumpty fell on his head. They picked him up and put him to bed. All the king’s horses and all the king’s men — they put Humpty back together again.”
In a Here360 blog post, on Nov. 17, 2021, an article titled: “This is when supply chains will get back to normal” makes the case that risks and disruption will abate. The article predicts that normal supply chain operations will stabilize in early 2022.
In a Supply Chain Brain video: “Putting the Pieces of Broken Supply Chains Back Together”, frames this issue as the “great reset”. The video explains automation, resilience, and a reorientation of supply chains will effect a return to normal.
That timing now seems optimistic. But it suggests improvement will happen as the threat of Covid-19 diminishes and technology’s capabilities press ahead.
Finally, in a Harvard Business Review article: “The Challenge of Rebuilding U.S. Domestic Supply Chains”, the authors suggest supply chains can be put together again. The article cites sourcing, domestic production, and partnerships as catalysts in restoring supply chain stability and reliability.
Beat the competition: Rebuild your supply chain to thrive
In contrast to last week’s article, this article embodies an optimistic view. Even so, this view recognizes the many challenges still impede a return to normal. That makes this a realistic viewpoint.
With that perspective in mind, let’s consider how supply chains can be put back together. As you’ll see, supply chains can be put back together even better.
In last week’s post, we established that “normal” referred to “the way supply chains operated before Covid-19” In this post, we’ll modify that definition using the term the New Normal. That implies a return to prior operations but in a different and potentially better way.
With that backdrop, let’s survey how supply chains can adapt to a changed, more competitive market.
How to renew your supply chain to compete in the New Normal
The industry consensus is that supply chain modernization has accelerated. But it’s more than that. In reality, the supply chain industry is transforming. That goes beyond acceleration of change, and it goes deeper than modernization.
Transformation implies a pivotal change in how supply chains operate. The key factors driving transformation are agility, speed, and resilience.
But that’s not all. Adapting to the New Normal also implies a hybrid workforce. – one that works both on- and off-site. And that places a premium on partnerships.
Two other attributes informing change are the rise of strategy and the customer.
Six key attributes required to restore supply chain performance
- Agility is a primary attribute influencing operations in the New Normal. With multiple challenges facing shippers, the need for flexibility is paramount. Today’s markets won’t tolerate the inefficiencies of rigid, clumsy, unresponsive business processes. are out. The New Normal demands agility, the ability to respond to customers’ needs rapidly. And agility enables the responsiveness of today’s consumer demands.
- Speed comes on the heels of agility. Besides building a flexible supply chain, you must also build in speed. The rise of e-Commerce has made speed a critical piece of reimagined supply chains. Speed derives from meeting customer demands. Impatient customers, conditioned by technologies’ capabilities want their merchandise, and they want it now.
- The above-cited Supply Chain Brain video asserts that resilience was not built into supply chains. In pre-pandemic times, risk management emphasized mitigation. By focusing on resilience, you can build active protection in guarding your network. With resilience, however, you can build active protection into guarding your network. Resilience can enable your business to respond—not react— to catastrophes and disruptions. Building resilience into your supply chain will go a long way to putting your supply chain back together.
- Partnerships with all supply chain stakeholders are no longer a minor consideration. They’re a necessity. During the pandemic, manufacturers and governmental agencies had to work together. Manufacturers had to collaborate with the FDA. And the FDA had to work with the Defense Logistics Agency (DLA) to procure disposable Leve3 and Level 4 gowns. A lesson learned is close communication and collaboration can help build informal partnerships. And that can lead to established partnerships. In the New Normal, established partners can restore supply chain effectiveness. Partnerships will separate successful supply chains from those that do not adapt.
- Strategic planning is another way to put your supply chain back together. Done right, strategic planning should help your business exceed its former effectiveness. When planning, you must consider the entire enterprise. You must look at how the parts and pieces fit together. A holistic view provides insights into how to integrate sourcing, operations, and finance. Putting your supply chain back together requires the integration of processes and people.
- Customer-centricity is now at the core of everything. At least it should be. By focusing on your customers’ needs, you can renew your supply chain. Doing that will help you achieve stability and reliability. For example, your customers’ need for speed encourages sourcing closer to the customer. You can reduce customer wait time by on-shoring or near-shoring. That also helps to reduce costs. Providing tangible value should drive your transformation. If you do that, you can restore your supply chain’s stability and reliability. It will also promote customer loyalty. Taking a customer-centric approach will help you exceed your supply chain’s former performance.
Are you ready to future-proof your supply chain?
At American Global Logistics, we take the optimistic view. We subscribe to the view that supply chains can be put back together. That doesn’t mean we discount the challenges our clients face. Our recognition of their challenges helps us to develop resilient supply chain solutions.
We embrace the strains, stresses, and struggles inherent in adapting to the New Normal. Those challenges help inform laying out a path ahead. More than that, those challenges guide our transformation to improve supply chain performance.
Contact us to learn more about how we can help you compete in the New Normal.