A More Robust Approach to Future Supply Chains

By Axel Schmidt, Senior Communications Manager, ProGlove

Nobody was prepared for the Coronavirus pandemic, thus resulting in serious implications for many individuals and industries across the globe. Additionally, this crisis has highlighted the significant reliance on supply chains for everyday life. As has been shown, any breakdown in the chain can have disastrous consequences for product fulfilment. Yet the truth of the matter is that nearly 75% of companies reported supply chain disruptions in one form or another due to Covid-19 in March 2020.

Lessons must be learned as the crisis continues to unfold, albeit that the severity has reduced for many countries. Because it’s imperative that businesses can come out the other side better prepared in case of a second wave or future global pandemics. Naturally, both could have the same or similar effects to that of the Coronavirus. Looking beyond just the expenses of global supply chains is one of the main points to consider. In fact, strengthening the human front-line workers should be essential even if it is considered to be one of the most costly assets. That includes increased investment in those who are working tirelessly to deliver products to the right places.

Robust enough supply chains will need a mixture of applied elements to stand up to future challenges as Axel Schmidt, Senior Communications Manager, ProGlove, explains.

Complexity of the supply chain                                                         

A vast amount of agents and infrastructure components including manufacturers, service and transportation providers, fulfillment centers, hubs, technology, equipment, vehicles and – most importantly – human workers, means that supply chains are both costly and complex. This, combined with a global pandemic leads to uncertainty among businesses from all sectors. One example is the global automotive supply chain: 83% of EU-based automotive businesses reported being ‘concerned’ or ‘very concerned’ about the implications of Covid-19.

Consumers add further complexity. Their demands are what drives supply chains but they can often be unpredictable. The Coronavirus crisis induced panic purchases and hoarding supplies are just two pieces of evidence to prove the point. While it may sound tempting to demand that organisations need to spend more to get more, we must not forget the quandary they are facing. Consumers respond extremely sensitively to price increases, but they will have to pay for the extra incurred expenses. That is why many supply chains today are lean and stick to a Just-In-Time (JIT) approach.

Furthermore, the different consumer buying channels add complexity. While the customer experience benefits from a multichannel approach, it also requires more manual labour. This, however, rules out automation as a cost saver in many scenarios. Moreover, customers expect rapid fulfilment with overnight or same day shipping at affordable pricing.

During the Coronavirus pandemic, more and more consumers have taken to online shopping. So, while many organisations around the world started laying off staff, retailers, healthcare suppliers and e-commerce businesses have struggled to cope with an unforeseen labour shortage. This surging demand had them hiring huge numbers of additional frontline workers, with Amazon announcing a further 75,000 extra job openings to cope with demand.

Strengthening with technology

As businesses look to reopen their workplaces, it’s crucial for them to deploy initiatives that encourage social distancing. The objective is to prevent employees reverting back to old habits that could endanger them. Technology such as an app linked to a wearable device that can send a combination of acoustic, haptic, visual signals, every time the employee crosses a set threshold can underpin these initiatives.

Axel Schmidt

The speed at which businesses are able to onboard new workers is essential when it comes to resolving a labour shortage. Technology such as wearable augmented reality devices can be a valuable tool as it can provide a perfect training ground for workers to master their job much faster while adhering to the government guidelines.

Keeping the workforce healthy and performing well requires the right equipment, including protective clothing and tools that enable workers to perform their roles safely and efficiently. Wearable technology such as barcode scanners can cut process times in half and provide instant feedback to workers which can help reduce typical picking errors by as much as 33 percent. Ensuring accuracy is key to cost saving as it can prevent expensive processes such as product returns, or time-consuming delays due to erroneous parts being removed from products.

So how can you appropriately prepare for a new virus wave or another potential global pandemic? Flexibility is the key to being able to do more with the same space. You need to be able to build, move and redesign workstations quickly, and then allocate workers flexibly in between. Deploying IT and training friendly technology in the warehouse and inventory almost overnight.

Empowering the human

Human beings are at the heart of the supply chain, although often the first association we make with supply chains is machinery, software, buildings, and transportation. But it is human skill that operates them, human ingenuity that manages them, and human shortcomings that identify the potential for substantial improvements. Greater enhancements can’t be made by eliminating the human aspects. Instead, organisations may be better off strengthening and empowering the human worker with technology.

The current challenges and vulnerabilities for global supply chains have been brought to light by the Coronavirus, so there is now an opportunity to reconsider the status quo in order to learn from the mistakes and safeguard supply chains into the future. Removing complexity and promoting flexibility with the support of technology is a good place to begin.