Associate Partner Katy Wallace discusses supply chain’s response to COVID-19 and shares her tips for 2021
The winners and losers
For so many years, we’ve been talking about automation being a threat to human occupations. In many ways, the COVID-19 crisis has accelerated the technological revolution. Nowhere is this truer than in supply chain, where many companies have been forced to redefine their distribution channels and adopt automated processes to help them get their products to market quickly and safely. But it’s the human element that has remained strongest in this challenging time.
The overriding message I’ve got from business leaders over the last few months is how proud they are of their people. It’s about more than reducing costs and increasing efficiency. Now boards are looking to their people for ideas, insight and direction, and we’re seeing more information across the business as a result.
When COVID-19 happened, the first thing everyone did was protect their people, recognising that this was the only way to keep the business afloat. Those who did well were retail and consumer businesses with agile supply chains and an already strong online presence. They reacted quickly by shifting stock capacity and warehousing so they could get their products to the consumer more quickly. Businesses that promoted health – for example, those in the health food industry – didn’t need to do much apart from keep their products moving.
Flexibility, speed and agility have been so important. Those who didn’t move quickly, didn’t allow their supply chain to change and adapt, weren’t innovative with how they delivered or stored their stock, didn’t have the tech infrastructure and systems set up to carry out online delivery, didn’t do so well. People are a key part of that ability to shift and adapt. Successful companies have protected their people and kept their productivity and manufacturing going. They’ve also protected their suppliers by maintaining purchases, increasing capacity in warehousing and distribution, working with them to cut costs.
It’s been an incredibly difficult time for the hospitality industry, which immediately went into survival mode. As well as cutting costs wherever possible, it’s been important for them to keep their suppliers and distribution networks ready for reopening, with the people and stock on hand to kick on quickly when things reopen.
Supply chain tips for 2021
Systems and ecommerce network
Get the systems in place so people can work from home. Implement new systems quickly – networks, routes, practices to support warehousing in the distribution area.
Customers will be key – when haven’t they been? – but businesses will need to be more customer-centric than ever, with the agility and speed in decision-making to react to customer behaviour. Expectations have changed and will continue to. You need to be able to adapt and innovate, react and even predict changes in customer behaviour.
What do you stand for? You need a more unique voice. Social responsibility, diversity, new product development, customer service. People are looking for your business to stand for something.
There has been an increase in conscious morality and social responsibility. The world has helped the world in most cases. Communities, businesses and countries have come together. The crisis has really increased our sense of community and responsibility. The world is healing itself in certain areas and people have reacted to that. The feeling is that putting sustainable practices into supply chain will now be a serious issue, financially and strategically backed by boards. Consumers want to see that.
Next year, you’ll need to set your strategy and implement transformation programmes around warehousing and manufacturing. This will include overhauling networks and shortening supply chains so that if there’s a phase 2, lead times don’t go up. Look at your insourcing and near sourcing. Focus on production and distribution networks. How many countries can you feasibly serve from one area? If you can’t get something from China, where do you need to put your warehousing and distribution?
Supply chain strengthened
Brexit was all we talked about for three years. COVID has shown that when facing the unknown, we have coped, innovated and thought outside the box. This has given some leaders more confidence about Brexit. It won’t be easy but we’ll adapt.
Over everything, people’s pride, passion, dedication and selflessness have shone through more than ever before, in the face of adversity, fear, uncertainty and mental strain. Technology is not human labour’s replacement – it’s human labour’s supplement. It’s the facilitator for the great innovation, creativity and resilience supply chain professionals have shown in the last few months. They’ll need a lot more of the same in the year ahead.
If you’d like to talk to me about the market or about finding your next opportunity or your next hire in supply chain, please contact me for an informal chat at email@example.com