Vaccines are being rolled out across the globe. The process is occurring faster in some areas than others, sure, but the fact that a vaccine is being distributed at all means that the worst is behind us and that everything will go back to normal. Right?
Okay, so nobody’s really going to be naïve enough to believe that everything will snap back to the way it was prior to the COVID-19 outbreak like a rubber band. And with the possibility of variants to the virus cropping up, an air of uncertainty lingers. Because of this, it’s still wise to take a look at your operations to discover where a flare up of the virus poses the greatest risk. As ISO’s paper, “Risk-Based Thinking in ISO 9001:2015,” states: “In ISO 9001:2015 risks and opportunities are often cited together. Opportunity is not the positive side of risk. An opportunity is a set of circumstances, which makes it possible to do something. Taking or not taking an opportunity then presents different levels of risk.”
Oftentimes, we take a critical look at the internal workings of our own operations to determine where potential opportunities lie. But what about externally? If there’s one thing that the virus has shown it’s how businesses are truly connected to one another. So even if you have your own operations prepared to mitigate the harmful effects of an outbreak, what happens if an outbreak occurs in another area where a supplier is located? Are you confident that they’ll be prepared?
In his article, “6 Types of Positive Risk,” John Spacey describes the supply chain as one of the areas where positive risk can be useful. “It is increasingly common for supply chains to run on a ‘Just in Time’ method for inventory control, whereby inputs arrive just as they are needed. As such, positive supply chain risks such as early deliveries are commonly managed,” he writes.
But COVID has proven itself adept at disrupting supply chains. The authors of the article, “Forecasting and Planning During a Pandemic: COVID-19 Growth Rates, Supply Chain Disruptions, and Governmental Decisions,” on the U.S. National Institutes of Health's National Library of Medicine state, “The severity of the business disruption of COVID-19 pandemic has challenged much of our previous understanding of what constitutes a resilient supply chain.” It needs to be said that the difficulties companies have faced with their supply chain isn’t purely academic, either. A survey conducted by Interos found that more than 90% of companies expect the disruption of global supply chains caused by the pandemic to have long-lasting effects on their businesses.
According to Michael Wilson, vice president of marketing and packaging for AFFLINK, a global leader in supply chain optimization and packaging and developers of ELEVATE:
COVID has finally proven that the world is interconnected. What happens in one part of the world can impact what happens in other areas of the world.
For instance, when it comes to the transporting of masks and PPE (personal protective equipment) from China, if China couldn’t meet the worldwide demand or needed the products for its own country, then the rest of the world had no option but to wait. While other countries soon started producing their own materials, they were limited because no Plan B was in place to tackle the challenge.
Another way COVID is different from past supply chain disruptions is its scope. Manufacturers around the world have all been impacted.
When certain raw materials or components are no longer available, it slows — if not eliminates — the production of many other products made by manufacturers globally. And even when supplies once again begin to flow, it’s often stop-and-go.
This requires manufacturers to turn to mapping strategies to have a better idea of when they can expect certain materials, if those materials might be delayed and what is causing the delay.
COVID is also atypical in that the duration of most other supply chain disruptions is finite. For example, a disruption occurs because of a major storm. However, in a relatively short time, things return to normal — as do supply chains.
With COVID, we’ve had spikes and lulls worldwide, but it is still with us. It took almost two years for the 1918 influenza pandemic (aka, the Spanish Flu) to disappear. This may be true with COVID, or it may last even longer.
Being able to monitor your supplier network in real time can make all the difference when it comes to keeping your customers happy. The past year has shown us how systems like Intelex’s vendor management software can be an invaluable tool when dealing with COVID-related uncertainty in the supply chain. COVID considerations aside, a better understanding of what’s happening in your supply chain can help with positive risk assessment — and discovering opportunities.