Resilience & Agility to face the COVID 19 Supply Chain stakes
17-04-2020
  • Case Study & Testimony

During the COVID19 crisis our CEO, Philippe Bornert try to identify and get the keys to help industrial managers to find the best direction 

First one: 

"Resilience and agility to face the new normal" 

 

The measures which have been implanted to decrease the COVID 19 effects on supply chains should reinforce the organization’s resilience to face the potential and inescapable future impact for companies.

Even the actual balance on human health is terrible and the virus’ spread is still there and unfortunately is increasing rapidly, the economic impact of this crisis begins to emerge.

Indeed, companies have to fight on multiple fronts at the same time: first, they have to think about how to protect their employees' safety, while preserving their operational sustainability under the pressure of a potential & historical crisis.

It can be seen that multiple companies are capable to mobilize themselves quickly and set up crisis processes, especially with crisis units, focused on the short term.

This raises the following question, How Supply Chain Manager could prepare the mid and long term while building the organization resilience?”  

In the actual landscape, we could say that the short term answer is to give an answer of 6 questions along the global Supply Chain.

These actions should be implemented at the same time as the sanitarian & political recommendations.

  1. Create transparency on the global value chain (from suppliers to the end customer)
  2. Evaluate all wealth and available resources in the supply chain
  3. Assess the realistic final customer demand and fulfill it. Or also contain the buying behavior of the final customer to avoid the bullwhip effect known by all supply chain managers.
  4. Optimize production and distribution capacity to provide employees safety situation. For instance by providing personal protective equipment (PPE) and being involved with the internal communication staff to share the contamination risk level and permitted to work at home. These measures allow managers to understand the actual and forecasted capacity level in manpower and material.
  5. Identify and secure the logistic capacity, speed it if possible, and be flexible on the transportation mode, if needed.
  6. Manage cash flow and the working capital by monitoring the flow to identify all potential problems and their financial impact.

 

Once all immediate risks have been identified, you have to think about how to set up an industrial tool to answer the new ‘Normal’. But the health of a company after an important break is difficult, as we can see actually with China.  

We talk about restarting multiple global supply chains. But the impact of the COVID 19 on timeline or intensity is different from a geographical zone to another one as the worldwide supply chains will be impacted on the med-long term.

The weakest point on the supply chain will determine the bring back of the success to employment, productivity and wealth or not… Managers should assess the complete industrial system and plan the proper action to get the right production level with the productivity rate needed. 

This health crisis will emerge common wills to limit some factors which have contributed to make this pandemic a worldwide one. The government will be encouraged to play a most important role in economic activities. CEO and managers have to anticipate these potential orientations in their decision of today.

Consequences of the COVID 19 event, have to be used as the opportunity to learn on the innovations and social experiences, from home office to the high-level supervision. It will allow understanding innovations, how to adapt the right one on a permanent way to improve the economic and social health of society.  

 

When we think about the changes’ depth that coronavirus has generated (and will continue for the next weeks and months), we have to reflect on the sanitarian changes but also the economic reform that has to be lead.

The managers' challenges will be to build a clear vision and get the direction to the new normal.

This new normality has to be built with resilience and agility to capture new opportunities. Now is the time for all of us to do our part!

 

Philippe Bornert, AGILEA CEO