A few weeks ago, we wrote about the impact of the Coronavirus epidemic on Supply Chains – specifically, how the emerging crisis in China had placed new pressures on companies importing finished goods and raw materials from overseas.
In that post, we wrote: “an epidemic striking at the heart of global manufacturing is a stone thrown into the ocean of the global economy, and the ripple effects are sure to be felt downstream. In the west, they may just be starting.”
Ominous words. Cut to a few weeks later, and we’re seeing those ripple effects turn into a massive wave. Now, with the arrival of community transmission of COVID-19 in the west, countries and companies are facing economic challenges on a wholly different scale from overseas Supply Chain disruptions.
Entire urban centres and hotspots are forced into temporary lockdown to maintain social distancing and slow the virus’ spread. Countries are restricting travel. It’s having a massive impact on the airline industry, restaurants, live entertainment, and other industries.
These are unprecedented times. 2020 feels cancelled, barely out the gate. It’s a fast-moving situation. While we all band together, shift to work from home, and practice social distancing to flatten the curve, one thing is becoming very obvious:
Supply Chains and Supply Chain Professionals are more important than ever before!
Well – maybe in our lifetimes. Supply Chains have long been part of the unsung backbone of the economy – the process, often invisible to consumers, that moves mountains of products from their origin, to manufacturers, to distributors, to customers.
As we’ve written about many times on the Argentus blog, Supply Chain Management generally tends to enter the wider public consciousness only when it fails – imagine Target’s empty shelves upon opening in Canada, or product shortfalls at LCBO stores due to distribution system errors. But so far, the COVID-19 crisis is putting the spotlight on Supply Chains and Supply Chain Managers in a different way:
With the world focused on maintaining the flow of essential goods and services as we fight the pandemic, this is the time for Supply Chain professionals to shine.
It’s clear that we’re living in an extraordinary moment, and Supply Chain Managers have an extraordinary task ahead of them – a task that they’re more than equipped to handle. We know this, because we work with them every day, working as recruiters to find talent for vacant roles in their organizations, working with them to place them in opportunities where they excel.
We see the mountains that they’re moving every day, and with the eyes of the world on Supply Chains, we’re confident that the profession will get the job done. This goes for everyone up and down these organizations, from the warehouse hands all the way up to VPs of Supply Chain. From the inventory managers, to the demand analysts, to the strategic sourcing specialists and everywhere in between.
During COVID-19, the world will depend on our profession to keep the world turning. Everyone, whether they’re working remotely, or working in healthcare and other essential services, relies on Supply Chain Managers to make sure that food, medicine, equipment and other vital supplies get into the hands of those who need them. We’re starting to see more recognition of this fact – for example with this viral video of Ajax Loblaw Distribution Centre workers hustling to make sure that goods get to stores.
The World Over Supply Chains are Adapting and Responding to the Crisis
Contrary to social media comments, the empty shelves that we’re seeing for toilet paper and some other essentials don’t represent Supply Chain failures, or even shortages in the pure sense. They represent an unprecedented increase in demand, as individuals seek to stock up on supplies given that governments are placing new restrictions on social gatherings to limit COVID-19’s spread.
In contemporary Supply Chains, many companies’ just-in-time manufacturing operations mean for very low inventory margins. This is the strategic position that companies have adopted. But in times of unexpected demand, those low inventory margins mean that people might see empty shelves periodically.
But as demand forecasts feed into adjusted production schedules, we will see today’s agile, digital Supply Chains respond to ramp up production to meet demand, as they’ve always done before. This is a distinction that many consumers don’t realize, but is part of the core operating procedure for sophisticated Supply Chains the world over.
As a great New York Times article over the weekend put it, “There is Plenty of Food in the Country.” When consumers see empty shelves, they panic, and assume that food and other vital supplies are running out. But DC centres are full of product, and stores are stocked every day. It’s just a matter of time until Supply Chains kick into high-gear to meet the demand.
Some Supply Chains are weaker than others, and show more vulnerability in a crisis. But Supply Chain Managers the world over are racing to develop creative solutions, identify more local sources of some products, and pivot to help the effort against Coronavirus – a necessity, given that there are real shortages of masks and other medical equipment that front-line medical personnel need. For example: as you might have read in the news, a number of distilleries are switching to producing hand sanitizer to help respond to the healthcare sector’s needs.
It’s just one example of something we predict we’ll continue to see in the future: manufacturers and Supply Chain Managers using their creativity and verve to rise to the challenge. For that reason, Supply Chain superstars will continue to be in extremely high demand.
Covid has changed the game, and the challenges are many. Now is the time to celebrate the mountains that Supply Chain professionals move every day.
And from all of us at Argentus, we wish everyone in our network continued health and safety as we continue to navigate these uncharted waters. If you haven’t yet, read our COVID-19 update to find out how we’re responding.