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Overcoming Coronavirus Effects on Supply Chain

Posted by [email protected] on Apr. 6, 2020  /  Subscribe 0

Coronavirus is on everyone's radar and it's a huge problem for everyone. Supply chain managers and production supervisors understand what the impact is and will be on their ability to produce anything. With so many parts and sub-assemblies coming out of China and India, the interruption to the supply chain due to the Coronavirus outbreak will be longer than anyone wants. Added to normal supply chain performance issues, the effect of Coronavirus infections goes deep into the very heart of production management. The challenges are many and the solutions are few, at present, but diligent attention to proven processes can eventually put matters back on track. The only question is when will the outbreak cease to cause a negative effect on supply chain continuity and performance and how will the coronavirus effects on supply chain.

Bad News and Good News

Everyone already knows most of the bad news. It's impossible to get parts, sub-assemblies, and complete products with any reliability or continuity. Freight forwarders are prioritizing medical products and supplies over other product shipments. Amazon announced shipping delays of up to one month on non-essential items for delivery. And there's more bad news. Many suppliers and manufacturers in China and India aren't answering their phones or emails due to restrictions on movements and gatherings. It means just trying to get an idea of how bad things are isn't going to be possible for a while. The good news is China is considering removing restrictions and allowing its population to get back to work. The other good news is scientists and medical researchers think they should have a cure for the malady very soon. 

Communications Are Key

Supply chain managers understand they are going to spend a lot of time making phone calls and sending emails. As the main player in a production environment, the logistics involved in re-starting a shut down production line are daunting. Estimating inventory levels for both incoming materials as well as outgoing products is going to take a lot of time and attention. Communicating with everyone from suppliers to freight forwarders and production managers to customers will require a great deal of effort and information. Given the estimated time it will take for the interruption to supply chain functionality to disappear, logistics managers and supply chain executives will likely have to revise schedules and timing many times over the next few months.

Brace Yourself, It's Going to Be a Bumpy Ride

The depth and breadth of the problems affecting supply chain performance are largely unknown. Prior experiences with the SARS outbreak and other disasters that affected the scope of Asian manufacturing and production in the past have led inventory managers to keep a higher level of stock than previously considered adequate when problems occur. Production operations working with minimal inventory or Just-in-time inventory management protocols will suffer most as time passes. Regardless of the inventory levels going into the Coronavirus outbreak, at some point, all manufacturers who rely in whole or in part on Chinese-sourced materials are going to feel the pain. Ports are limiting shipments while dockworkers deal with the virus. Ships are unable to leave ports due to crew shortages. Even when the supply chain begins to refill and recuperate, the flow of products will be askew at best.

Preparing In Times of Uncertainty

The outbreak of Coronavirus caught everyone by surprise. The speed with which it has spread and the effect it has had on global society is unprecedented in modern times. It may not be the first thought on logistics and supply chain managers’ minds, but it is an excellent opportunity to refine and upgrade data systems, inventory control protocols, and software. With little else going on, why not be prepared for the pending avalanche of materials that will reappear once the crisis has passed? There's no better time to install improvements and increase efficiencies than when there's nothing else happening. Communications protocols with suppliers, identifying new suppliers, and reviewing purchasing methodologies can be accomplished in the middle of the disaster. Hunker down, reach out, watch the news, stay healthy, and dream of improved logistics and supply chain management. When the going gets tough, supply chain professionals get going!

Get Started On A Career In Supply Chain Logistics

If problem solving is your forte, then a career in supply chain management could be your calling. This industry is fast-growing and involves many high-paying positions. Visit APICS to view your certification options, ranging from courses that can prepare you for management or in-depth classes that will help you better understand more intricate processes.

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