Build a playbook to implement supply chain resilience

This is an excerpt of the original article. It was written for the November 2022 edition of Supply Chain Management Review. The full article is available to current subscribers.

November 2022

Are you resilient? It’s not an idle question. If there’s one word that I’ve heard at every supply chain event I’ve attended this year, its resilience. It is, of course, in response to the last few years in supply chain management. I think its fair to say that supply chains have been knocked to the canvas more times than Rocky. What has become clear as we do our post-pandemic reviews is that the firms that demonstrated the ability to get up off the canvas and keep punching were those that invested in resiliency before the pandemic—even if they didn’t use that term.

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The July 2020 issue of SCMR featured my article, “Risk management in an era of extreme uncertainty.” The world had just woken up to the first quarter of the COVID-19 pandemic. Supply chains globally were disrupted and lead times from orders to delivery, or O2D, had suddenly grown by 50% in some cases. Ports were choked up and containers lined up awaiting their turn to be offloaded. Shelves for consumables in the United States were emptier than I had seen in 30 years. As the severity of the pandemic eased and the world began to unclog, we were faced with a new global issue—a senseless war in Ukraine coupled with global monetary policies that combined a delayed reaction with signs of an unexplained bull market.

In the United States, the consumer felt the pressures within weeks. The price of oil escalated around the globe as sanctions against Russia took hold. The price of gasoline increased 22% in April of 2022. Because Ukraine is a major producer of wheat, the impact on the price of food was felt as a lagging indicator. As if we didn’t need a reminder that unexpected disruptions continue to pop up, last September the United States narrowly averted a railroad strike that would have crippled domestic supply chains even further.

As companies rethink their supply chains to respond to instability, unpredictability and the unexpected, one factor is missing: A playbook, or a guide, that can be used to implement a structured approach to supply chain resilience. However, no two situations will be the same and hence companies need to think along the lines of the SCOR model for areas that are appropriate and can be modified to match future situations like the ones in play today.

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