For years supply chains have been getting increasingly complex. An entire industry has grown up around them consisting of supply chain consultants, universities producing masters students and doctorates of supply chain strategy and more supply chain theories from business schools than you can shake a stick at. This is probably why the last three years have begun to show why so many supply chains are not effective. They are too complicated. They have become the product rather than a means of delivery.
It all began with Covid. For years supply chain consultants and strategists have been talking about robust supply chains and then along came an entirely predictable event (remember proper advisers had been warning governments to plan for a pandemic for years before Covid) and for several weeks we saw the food supply chain (and of course toilet rolls) fall apart.
Then came the war in Ukraine. Another entirely predictable event which has caused energy prices to rocket, the real possibility of world food shortages and the knock on effects from that.
Many businesses are reliant on fertilizer production such as the brewing industry and others who use the by product Co2. Many plants are now closing as due to the energy price rise is making fertilizer production uneconomic.
Let’s not even mention Brexit!!!
I can hear the cries of the supply chain strategists from here. “This is a perfect storm, nobody could have predicted all of these coming together, we were prepared – honest guv, just not for all of them at once.”
They have all forgotten about the Japanese tsunami and the Icelandic volcano, both of which caused supply chain chaos.
It may well be productive and efficient to produce goods and services in the cheapest place but is it effective?
All the indications are that things will get worse before they get better and so now is the time to look at your supply chain from an effective point of view.
Just In Time production is only effective if your supplier can guarantee supply. If you have just one critical supplier in your chain who is not just several hours away but several countries away then your supply chain cannot be effective.
Please have a look at my blog on the subject of inventory TIMWOODS Is Unwell Inventory
Remember, if you can produce when others can’t then the advantage will be yours.
Review your supply chains from a business and personal point of view before it’s too late.
It might not be so easy next time.
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