Building A More Resilient Supply Chain In A Post-Pandemic World

Building A More Resilient Supply Chain In A Post-Pandemic World

The COVID-19 pandemic continues to spur a rethinking of many aspects of society — everything from commonly held business practices to long-e... 7:30 AM

The COVID-19 pandemic continues to spur a rethinking of many aspects of society — everything from commonly held business practices to long-established personal and civic habits.

The global supply chain has been a key topic of conversation, and deservedly so. As businesses close and governments impose lockdown orders around the world to contain the outbreak, demand for essential goods and supplies has skyrocketed. The dramatic changes have also laid bare our utter dependence upon a highly complex, fragmented and inefficient supply chain.

Looking past the current emergency, it’s clear that we need a more resilient supply chain that can readily flex and adapt during future times of crisis and stress. So how do we get there from here?

Enterprise tech has to be brought to the home

For many years, people in tech circles have talked about “the consumerization of IT.” That's industry jargon for extending the same people-friendly usability we expect from consumer technology to the enterprise. Think of the early use of Dropbox, which started as a consumer product but was so easy to use that people began installing it in droves on their office machines.

A more resilient supply chain, however, requires that we flip that model. We need to bring enterprise technology - with all of its superior functionality, scalability, efficiencies and security — to the growing population of remote and at-home supply chain workers.

The good news is, we know how to do this: with supply chain solutions built from the ground up based on a multitenant cloud architecture.

The issue is that many of today’s supply chain systems were architected to be on-premises. And while some are now accessible outside the four walls of the enterprise, they simply don’t have the many inherent advantages of true multitenant solutions - advantages such as easy updates, lower maintenance costs, and highly secure remote access for employees and supply chain partners. In hopes of keeping the supply chain productive and functioning correctly, software companies serving the supply chain have to step up to this challenge and modernize their applications.

Real-time, data-driven collaboration is now mission-critical

As hard as it might be to believe, the supply chain has been “doing business in the dark” for decades. While consumers long ago became accustomed to clicking a few buttons to find the location of a package in transit, a shipper spending tens of millions of dollars to ship freight around the world couldn’t do the same thing. That was due to the massive complexity of a supply chain composed of tens of thousands of companies dispersed across the globe, speaking different languages, complying with varying regulations and wrestling with unique challenges.

As the CEO of a company that helps provide visibility into freight in transit, I've seen firsthand how this has started to change in recent years. But COVID-19 — more than any event that came before it — is shining a light on the need for supply chain visibility and access to reliable, real-time logistics data. Armed with such data, supply chain companies can collaborate better across the company — as well as with partners and even competitors — to find efficiencies.

For example, one of the biggest inefficiencies in freight transportation is dwell time, which refers to the time a vehicle sits idle at a facility waiting to load or unload. Long dwell times are bad for all. They result in steep fines and eat into drivers’ hours of service. Also, extended dwell times have been shown to increase the likelihood of subsequent accidents on the roadways.

For logistics or freight companies looking to build a more resilient supply chain, team members should collaborate on various corrective actions to reduce dwell, such as:

• Offer a digital check-in option to reduce driver on-site time.

• Provide better load balancing (i.e., optimize inbound and outbound load volumes across the days of the week to bring down dwell).

• Consolidate purchase orders for the same item in a single PO.

• Provide flexible staffing based on load volume rather than predefined staffing across all shifts

• Collaborate with carriers who have high dwell percentages to optimize appointment slots and related factors

Data-driven collaboration empowers supply chain stakeholders to identify root causes and find solutions. That’s good business practice in normal times, but it's an absolute necessity during times of crisis.

We need better forecasting and inventory management

Over the years, the world’s manufacturers and retailers have invested a great deal in sophisticated modeling and forecasting to estimate demand and manage inventory, ordering and related processes. COVID-19 has blown up all of the old models. Before now, no one had ever seen these sorts of unprecedented spikes in demand.

New forecasting models need to be developed. More broadly, the supply chain must invest in more robust risk management strategies and plans. Real-time supply chain data is critical to these efforts, as is the application of artificial intelligence to surface insights and enable better decision-making.

COVID-19 has put the global supply chain under tremendous strain. Thanks to the heroic efforts of so many supply chain workers — in particular the truckers, dock workers, grocery store employees and everyone working on the front lines — essential goods largely continue to get where they need to go. But we can do so much better. We can build a more resilient and agile supply chain that can help us all manage our way through the next crisis rather than react to it.