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Logistics & Transport Trends

#BizTrends2021: 2021 holds supply chain profession's greatest endeavour ever

With the worldwide roll-out of a Covid-19 vaccine, life and economies could potentially see a return to some semblance of normality by the end of 2021.

Distributing the vaccine to billions of people around the world will be one of the supply chain and logistics profession's greatest endeavours ever.

In addition to distributing the vaccine itself, there are secondary supply chains that will be vital, too. Think of the billions of syringes needed to administer the vaccine! We will need as many syringes as doses of vaccine. We will need safety boxes for used syringes.
Richard dos Santos
Richard dos Santos

Supply chains that were stretched and strained during the Covid-19 pandemic with the distribution of PPE (Personal Protective Equipment) may not be ready. One of our most pressing imperatives is to upskill supply chain professionals, to equip them for the vaccine distribution challenge and to ensure that global supply chains can withstand future disruptions like the Covid-19 crisis.

The world has never needed professional, suitably qualified supply chain professionals more than we do right now. The role played by the Professional Body for Supply Chain Management (Sapics), for example, in promoting professionalism and community in African supply chains, and in delivering education, training, networking and knowledge-sharing opportunities for supply chain professionals, is more important than ever.

Mitigating risks

Covid-19 reinforced the importance of risk management, supply chain resilience and supplier development. The pandemic and its lockdowns impacted the demand side of supply chain management. Economic uncertainty introduced more variability.

In response to panic-buying and stockpiling, supply chain professionals scrambled to meet increased demand by ramping up orders and production to try and keep shelves stocked. The result in many cases, however, was long term excess inventory problems along the entire supply chain, with a yo-yo approach to supply chain demand and to addressing supply problems.

Different industries experienced supply chain disruptions in different ways. Many supply chains saw upside variability - or demand increases - while others faced downside variability, and, in the case of airlines, cruises and associated services, outright decimation.

The impact of China’s lockdown served as a major wakeup call to organisations dependant on the country’s manufacturing capabilities to fill supply lines. It will be interesting to see whether this drives the revival of local manufacturing capabilities that have been offshored and, in many instances, mothballed.

A lesson that supply chain professionals must take from the Covid-19 crisis is that business risk assessments need to include the detailed mapping of supply chains and suppliers.

Covid-19 also highlighted gaping holes in organisations that had digitised their supply chain pre-pandemic. Laggards have now been quick to move to Cloud and to introduce new technology to promote visibility, communication and direct access to customers, having learnt that this is crucial to mitigate the impact of supply chain disruptions.

Looking ahead to what supply chain and logistics strategies we are likely to see in 2021 in light of Covid-19, I expect that organisations in some sectors – like the automotive and pharmaceutical industries - will prioritise resiliency and the analysis of supply chain weak points over quick gains.

Other sectors - like retail, ecommerce and banking - wll push expansion and will trial new ways of doing business. A W-shaped economic recovery seems likely as the world grapples with the peaks and troughs of economic activity linked to waves of regionalised Covid-19 infections.

A lesson that supply chain professionals must take from the Covid-19 crisis is that business risk assessments need to include the detailed mapping of supply chains and suppliers.

We have also learnt that supply chains need to be redesigned; with dynamic rather than static capabilities. We have to be able to cater to customers that change their normal buying behaviours because of the changing situations they find themselves in.

There have been some positive supply chain outcomes of the Covid-19 crisis. It highlighted the importance of supply chains to everyone. The conversations around supply chain activities are happening far more frequently. From being a field that was not well understood and sometimes undervalued, working in the supply chain profession is now something to aspire to.

The Covid-19 crisis drew attention to the profession and elevated it. I expect that more people will begin to have an interest in the field, and we will be able to leverage that to build an enhanced workforce. The supply chain profession may emerge from this crisis stronger and with a new pipeline of talent.

About Richard dos Santos

Richard dos Santos is Director of Sapics, The Professional Body for Supply Chain Management.
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