The effects of COVID-19 on businesses were felt globally. The scale of the crisis and the rate in which it evolved caught supply chains worldwide unprepared to manage widespread shutdowns, the need for strict safety protocols for employees, and higher than usual customer demands. Even companies with excellent risk management systems in place suffered as a result of the unpreparedness for this scale of disruption.
COVID-19 exposed severe flaws in our supply chains. Most of the response was reactive and uncoordinated. The logistics and supply chain industry will see a massive surge in research, technology, and forecast modeling as companies prepare to improve their supply chains' resiliency. This means newer, more significant investments and plans for prevention to protect companies and employees from disruptive events in the future.
Logistics and supply chain professionals experienced some of their toughest challenges and will need to head back to the drawing board to refocus and recover from the pandemic.
How should logistics and supply chain professionals prepare for the future?
1 - Ensure employee safety
The pandemic put plenty of pressure on companies to keep employees safe if they wished to continue to do business. From redesigning warehouse layouts and implementing a safe distance to providing sufficient and effective personal protective equipment (PPE), ensuring your employees’ safety should be a priority going forward.
Business leaders will also need to evaluate sick leave and wellness policies and how to respond when their employees' health impacts operations and output.
2 - Reevaluate supply chain networks
Supply chain professionals will need to reevaluate long and complicated supply chains. Will they localize production? How easily accessible should your inventory be?
Learning how to map your supply chain networks accurately will better prepare you for pandemics, giving you better visibility into the structure of your supply chain.
Having a written plan in place in response to pandemics or other disruptive events with suppliers is vital. Expectations of recovery times and methods should be laid out to protect both your company and your customers.
3 - Manage your budgets
Pandemics will throw your budgets for a loop. Cost-savings plans get a little trickier. The need for higher and faster production will increase logistics and shipping costs. You will need to be prepared to set in place a reasonable budget for disruptive events, as well as learn to manage it on the fly when unexpected events occur. It could cost or save your company millions of dollars.
4 - Access to data
One of the toughest challenges during the pandemic was not having vital information readily available or accessible across global teams. Companies did not know exactly which suppliers, sites, parts, and products were at risk. The disruption was so rapid and widespread; there was no way of finding alternative sources. Real-time data visibility should also be a big focus in your future business plans.
5 - Assess and leverage your logistics and supply chain technology
In general, access to timely data and forecasting models is crucial. When disruptive events occur, historical trends and prediction models can help better prepare your business.
While the data you had previously couldn't have predicted the scale of response needed for COVID-19, we can use our recent data to have plans set in place for the future if ever an event of this scale occurs again.
Being able to use the technology to analyze and leverage data is going to be a principal responsibility for logistics and supply chain professionals.
Other key technologies to explore for the future include artificial intelligence (AI) and blockchain.
Preparing for Unexpected Challenges
Our constantly-evolving global economy demands us to be life-long learners prepared to tackle unexpected business challenges, find solutions, and lead strategically. Earning a specialized graduate education is still one of the effective ways to learn how to tackle these levels of challenges by providing the necessary skills, knowledge, credibility, and confidence. A Master of Science in Logistics and Supply Chain Management from FIU is a dynamic educational program focusing on logistics technology, data analytics, and distribution modeling. To learn more about earning a master’s degree, attend one of our information sessions.