by Dr. Tan Miller
At the beginning of the COVID-19 pandemic, many people who wanted to buy toilet paper and Clorox wipes couldn't find them. The reason why lies in the typically unseen process of supply chain management.
Supply chains produce and deliver finished goods available to purchase in retail stores or e-commerce vendors like Amazon. Their inner workings remain relatively invisible to many who do not work in the profession. Most consumers only recognize breakdowns in the supply chain when they don’t get the goods or services that they need or desire in a timely manner.
What are supply chains?
A complete supply chain consists of many individual firms’ supply chains. It collectively transforms raw materials and components into finished goods and services delivered to retailers and consumers.
Each firm has its own supply chain network. These networks link together to form the overall industry supply chain. In many cases, these supply chains consist of a labyrinth of raw material sources, such as mines, farms, factories, warehouses and more, connected by many forms of transportation.
What can go wrong?
The non-technical answer is: almost anything!
Supply chains form a complex web of entities that must work together in precisely timed activities. These connections run through a multitude of countries, each with their own laws, regulations and infrastructure.
Most supply chains are vulnerable to disruptions at hundreds or thousands of points. These disruptions can range from the minor to the major, from a flat tire that causes a two-hour delay in delivering a product to a tsunami that wipes out a critical parts production facility.
The COVID-19 pandemic has created enormous supply chain disruptions. Outbreaks of the coronavirus among workers at meatpacking plants forced the temporary closure of many of these facilities, leading to beef and chicken shortages. Shortages of critical protective medical equipment forced our valiant medical personnel to work in perilous conditions. U.S. consumers desperately struggled to obtain scarce products such as sanitizing wipes, gloves and masks.
These disruptions brought on by COVID-19 have made us all acutely aware of the importance of robust supply chains and the personnel that plan, operate and manage them.
Can supply chain disruptions be prevented?
Unfortunately, the answer is no — at least, not completely. However, every year the supply chain profession devotes increasing resources to mitigation and prevention efforts. In recent decades, as supply chains have become more global, risk management has vaulted to the forefront of decision-making.
For example, some manufacturers will now forego opportunities to minimize costs by using multiple suppliers for key parts or materials rather than sole-sourcing them from the lowest cost supplier. Some multi-national firms are reconsidering their strategies and migrating toward employing multiple regional and local supply chain networks rather than relying on one larger global supply chain. New technologies, such as 3-D printing and robotics, are being employed to reduce vulnerabilities to supply chain disruptions.
In the end, no full-proof elixir to this ongoing cat and mouse struggle exists. However, innovative strategies and technology will continue to facilitate dramatic progress.
Dr. Tan Miller is the director of the global supply chain management program.