The Big Pivot

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

January-February 2022

Well, that’s over, and aren’t we all glad to put 2020 in the rear-view mirror? For a minute, however, let’s look at a silver lining, because I think there is one for supply chain managers. That’s because the pandemic put supply chain in the spotlight like never before—and, with the approval of a vaccine just a few weeks ago in December, supply chain and cold chain are back in the news… While sales usually gets all the attention, maybe 2021 is our time to shine.” That’s the beginning of the column I wrote for the January 2021 issue, and maybe I was a little too pollyannish.

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To say that the COVID-19 pandemic has been an unprecedented global event is an understatement. It has affected all aspects of life in most countries. From a supply chain standpoint, it’s difficult to imagine an industry that was not disrupted, and that did not experience unanticipated changes in demand and supply patterns. Shortages of toilet paper may have been the most visible, and personal, but since then, business has experienced shortages of everything from computer chips to the elastic used to make face masks.

When the global economy shut down, few retailers or manufacturers anticipated the dramatic increase in demand that occurred in the middle of 2021. For instance, automotive companies dialed back production capacity only to find shortages of critical components such as microprocessors when they decided to ramp up their production to normal levels. The demand for steel, lumber and home delivery of products increased dramatically as employees working at home decided to spruce up their kitchens, bathrooms and home offices. Companies as sophisticated as Apple were forced to lower their production forecasts for newer models of their phones.

On the consumer side, retailers also had to change their operating procedures to comply with capacity and safety restrictions imposed by the Center for Disease Control and Prevention (CDC) and state and local governments. Customers walking into a store confronted a myriad of dos and don’ts: There were mask requirements, floor markers indicating where to stand to maintain social distancing, plexiglass dividers at checkout stations and hand sanitizers at entry and checkout. For a time, some businesses, such as Trader Joe’s, limited the number of customers in their store at any one time, resulting in customers waiting outside for their turn to enter.

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