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Read on for research and insight surrounding today’s supply chain execution crisis, including insight into navigating toward success.
SUPPLY CHAIN
“It'll be worse, and it's going to last over many, many months,” Lora Cecere, founder and CEO of research firm Supply Chain Insights, tells CGT. “I think we're dealing with two to three years of unprecedented demand and supply disruption, and we're going to find that our current practices aren’t equal to the challenge.”
The COVID-19 pandemic tested the global supply chain. While prior risk management disruptions occurred and followed by a new normal, in the COVID-19 pandemic, the only normal is constant change. Like driving on a bumpy road, supply chain leaders will ride the ups and downs facing greater variability day-to-day until the end of 2021.
During the pandemic, companies were unable to use their demand planning solutions, according to information based on interviews with 30 supply chain leaders. Companies turned their demand planning solutions off and managed through brute force. The issue? Order and shipment data was out of step with the market and the models were not flexible enough to use consumption data to understand the ever-changing market conditions.
It’s never a good sign when the supply chain is headlining consumer media, but much like the best way to purchase N95s, the topic of container tracking and port congestion has become unlikely dinner table fodder. Thanks to a disruption cocktail of pandemic-prompted factory shutdowns, input shortages, labor scarcities and rocky logistics — not to mention the rapid e-commerce acceleration throwing gasoline on the fire — the consumer goods industry finds itself in a supply chain crisis. And, unfortunately, the light at the end of the tunnel remains hazy.
Tom Madrecki, VP of supply chain and logistics at the Consumer Brands Association, echoed this in a recent interview with CGT, noting the general consensus from the supply chain executives of the member group are eyeing late 2022 or potentially 2023 as the length of disruption.
As the industry grapples with myriad challenges, CGs are using this moment to reexamine current supply chain execution strategies — if only out of pure necessity — with the hopes of emerging wiser for the next disruption.
By Lisa Johnston
Complexity and cost of ongoing support and maintenance
Obtaining budget for upgrade or innovation
Lack of automation in the related core processes
Complexity of customer interfaces
Complexity of enterprise user interfaces
Making data accessible across the value chain
Compliance with security standards and regulations
Intergration with other applications and systems
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
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Source: Bank of America via Nasdaq
Increase in mentions
of
in Q3 earnings calls by Fortune 500 companies vs. last year
“supply chain”
Jordan Speer is Research Manager for IDC Retail Insights, responsible for covering the global supply chain. Her core research examines how digital technology opens opportunities to better connect and optimize the execution of the end-to-end supply chain from order creation through order fulfillment.
jspeer@idc.com
Q. Considering your company's supply chain, what are the key challenges that you face in transportation optimization and last-mile optimization at your company?
Retail Transportation Optimization and Last-Mile Optimization Challenges
Fig. 4
