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Remember the Days of Disruption
From a supply chain standpoint, the days leading up to Christmas and the holidays should be a happy (albeit a little hectic) time of year. All the toys and other goodies should be snugly nested in the retail outlet or tucked in the distribution center for online orders. For the most part, that’s the way things seem to be going this year.
But short-term memory can be hazardous to your supply chain health. It was just five short years ago this time of year that we were feeling the full force of the West Coast port strike of 2002. Some of the most popular Christmas presents were in short supply. Overall, the American supply chain overall, was thrown into a tailspin.
Given the significant pain caused by this disruption (estimated to be in the billions of dollars to the U.S. economy) we all should have learned a lesson. But recent research—including a study done by SCMR—suggests otherwise. Many companies simply have not done the contingency planning to minimize the impact of another disruption like the West Coast strike—or even lesser events.
Our annual “Global Survey of Supply Chain Progress,” http://www.scmr.com/article/CA6492752.html conducted in conjunction with CSC Consulting and Michigan State University, found that only about 40 percent of respondents said that their companies paid sufficient attention to supply chain disruption and risk mitigations. And only about half indicated that their chief executives were sufficiently aware of the potential consequences of a major supply chain disruption. A recent McKinsey study come up with similar results, finding that only about one of three companies they surveyed had robust supply chain disruption plans.
Stability is a wonderful thing as long as it doesn’t lead to complacency. In fact, it’s during times like these when things are relatively stable that you need to prepare for the worst. Don’t wait for the link in the chain to break. Preparing formal, comprehensive plans to cope with a potential supply chain disruption—whatever the source or the scope—is not paranoia. It’s good business practice.
Let’s make sure that everyone, young and old alike, keeps getting what they want for many Christmases to come. In a very real sense, supply chain managers are the Santa enablers that make it happen.
Remember the Days of Disruption
December 4, 2007
From a supply chain standpoint, the days leading up to Christmas and the holidays should be a happy (albeit a little hectic) time of year. All the toys and other goodies should be snugly nested in the retail outlet or tucked in the distribution center for online orders. For the most part, that’s the way things seem to be going this year. But short-term memory can be hazardous to your supply chain health. It was just five short years ago this time of year that we were feeling the full force of the West Coast port strike of 2002. Some of the most popular Christmas presents were in short supply. Overall, the American supply chain overall, was thrown into a tailspin.
Given the significant pain caused by this disruption (estimated to be in the billions of dollars to the U.S. economy) we all should have learned a lesson. But recent research—including a study done by SCMR—suggests otherwise. Many companies simply have not done the contingency planning to minimize the impact of another disruption like the West Coast strike—or even lesser events.
Our annual “Global Survey of Supply Chain Progress,” http://www.scmr.com/article/CA6492752.html conducted in conjunction with CSC Consulting and Michigan State University, found that only about 40 percent of respondents said that their companies paid sufficient attention to supply chain disruption and risk mitigations. And only about half indicated that their chief executives were sufficiently aware of the potential consequences of a major supply chain disruption. A recent McKinsey study come up with similar results, finding that only about one of three companies they surveyed had robust supply chain disruption plans.
Stability is a wonderful thing as long as it doesn’t lead to complacency. In fact, it’s during times like these when things are relatively stable that you need to prepare for the worst. Don’t wait for the link in the chain to break. Preparing formal, comprehensive plans to cope with a potential supply chain disruption—whatever the source or the scope—is not paranoia. It’s good business practice.
Let’s make sure that everyone, young and old alike, keeps getting what they want for many Christmases to come. In a very real sense, supply chain managers are the Santa enablers that make it happen.
Posted by Frank Quinn on December 4, 2007 | Comments (0)
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