It shouldn’t come as a surprise to anyone in the industry that trade will remain incredibly tight for the remainder of 2021 and through 2022, with constraints resulting mainly from port infrastructure challenges, demand variability, COVID-19 resurgences, and carrier capacity.
“Global supply chain bottlenecks are feeding on one another, with shortages of components and surging prices of critical raw materials squeezing manufacturers around the world,” wrote reporters for the Wall Street Journal in an Oct. 8 story.
I recommend to any executive seeking guidance that all aspects of their business ought to focus now on resilience. Engage your partners and stakeholders with transparency about the challenges; don’t try to shield them from reality. Leaders need to concentrate on business continuity and supply chain agility, whilst scenario planning throughout the value chain of inputs and flows.
Even when it looks like conditions are approaching catastrophe, there is always something an organization can do. After the 2014 flooding in Somerset, Prince Charles visited the area to learn about relief efforts and remarked, “There’s nothing like a jolly good disaster to get people to start doing something.”
Now is a good time to remind managers that they need not wait for a jolly good disaster to create a plan of action. Rather, multiple “scenario plans” are crucial to providing guidance in the case of any disruption one can think of — and they must include mechanisms for coordinated communication and implementation across the value chain. Making sure these scenario plans result in opportunities for reserving capacity within manufacturing and transport divisions will allow your company to switch gears when needed.
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(This article originally appeared in Global Trade Magazine.)
