With supply chain challenges not looking to end anytime soon, particularly as worker shortages continue, experts gathered online recently with some tips on how companies can find long-term solutions. However, labor isn’t the only issue. Robert Handfield, professor of supply chain management at North Carolina State University, said climate change, COVID, labor–all of these are hitting at once.
“You only have to hit one node and the whole chain shuts down,” he said.
Handfield said COVID opened many eyes in terms of the supply chain. “People didn’t even understand who was in their supply chain and where their stuff came from,” he said. “We have always had very fragile supply chains and the more we outsource the more risky they become.
It has all caught up to us now and we are now paying the piper.”
Christopher Tang, professor at the UCLA Anderson School and author of a book detailing how to manage supply chain risks, said the pandemic made this a global issue.
“This is a wake-up call for the entire industry,” he said. “Even the government doesn’t have good information.”
The list of what is needed, according to Tang, includes improved inventory management systems, regional suppliers in Mexico and Canada that will allow U.S. companies to shift back and forth, and utilization of 3D printing as a viable technology, to name a few.
“We need to leverage government, the private sector and university resources,” he said. “We are way, way behind.”
Handfield agreed with his colleague and added that onshoring, or reshoring, takes time and the government needs to create incentives for companies to go that route.
Tang referenced the recent creation of a supply chain dashboard but questioned its efficacy as the platform is only updated every two weeks.
“Either you have a plan in place or you don’t,” he said. “The government needs to develop a better supply chain system. Without information, you are shooting in the dark.”
Handfield agreed that the government has to build an innovative data platform to pull all this together.
“This is the moment of truth,” he said. “If we rely on imports, then the information systems and infrastructure needs to be updated. If we had real-time information, everything would be different from shipping and more.”
Still, both professors agreed labor plays a huge role.
“Supply chains are run by people,” said Handfield. “Until we get the world vaccinated, we will continue to see disruptions.”
The webinar was hosted by INFORMS, an association for operations research and analytics professionals.