Impact of Covid article and permission to publish here provided by Boris Dzhingarov.
The Covid-19 pandemic has impacted almost everyone. Some sectors have had a worse time than others, but there are very few that have thrived amidst the chaos.
In this article, we will examine the problems many sectors have experienced, and what the future looks like for the global supply chain.
One point worth making is that the pandemic did not cause all of the problems – it merely highlighted inefficiencies and vulnerabilities. However, the problems associated with staff shortages due to lockdowns are due to the pandemic.
How Bad is the Impact?
A survey carried out by one of the Big Four accounting firms, Ernst & Young, had some interesting findings. The results from key sectors, including automotive, tech, and life sciences, made it clear that the pandemic had a massive impact on supply chains, with 55 percent of senior-level supply chain executives stating that Covid had had a mostly negative effect on their business, and 17 percent reporting a significantly negative effect. Only 3 percent reported the pandemic had had a significantly positive effect.
The life sciences sector saw the most positive effects because their products are classed as essential. Many others, especially those with factory settings, saw significant disruption due to employees being forced to self-isolate, as well as the implementation of physical spacing and PPE to reduce employee exposure to Covid.
All of this disruption has increased costs across multiple industries. Businesses that source supplies and raw materials from overseas have had to endure long delays in shipments. It has had a knock-on effect across the board. As an example, the linked blog post looks at how increased costs impact the sanitation industry.
What Can Businesses Do?
One silver lining to come out of the Covid pandemic is that most businesses have been forced out of necessity to look at their supply chain in greater detail, in the hope of maximizing efficiencies. This ensures their networks are more resilient to future problems.
The E&Y survey found that businesses are prioritizing efficiency in their supply chain and looking to invest in their workers, to ensure they have the right skills to boost productivity. Another interesting finding is that visibility in the supply chain is also viewed as important. For example, businesses are recognizing the importance of technology in tracking global shipments, in particular, any that are sensitive in terms of time or temperature. Covid vaccines are a good example of a product that benefits from being tracked at every stage of the journey.
Technology is becoming increasingly important in global supply chains. The disruptions caused by Covid-19 have highlighted how critical it is to track shipments and automate processes. Many businesses are already investing in technological solutions, such as AI and machine learning.
Experts believe that future-proofing the supply chain against events like Covid-19 will involve switching to autonomous and digital solutions, such as warehouse robots and delivery drones.
If you haven’t already, look closely at the strategic architecture of your current supply chain and see where improvements can be made.