Originally posted in Adhesives and Sealants Industry in May of 2023

As the healthcare industry supply chain faces more challenges, supporting industries must be proactive, resilient, and innovative.

Although the visible bottlenecks in the healthcare supply chains are getting calmer, volatility will remain high. From the impacts of increasing interest rates and bank failures to labor and material shortages to global conflicts, the risks in healthcare supply chain will skyrocket. This situation will create as many opportunities as challenges, and so the proactive, resilient, and innovative companies will thrive while the rest diminish. The key will be deliberately making that choice and ensuring your end-to-end supply chain partners are on that same trajectory.

Current Status of Healthcare Supply Chains

Since the supply chain is an interlinked series of suppliers, manufacturers, and logistics partners, the bottleneck moves from one link to the next as demand and supply are out of alignment. During the pandemic, the visible signs were abundant with ports stacked up at the ports. Fast-forward to post pandemic and much of China was locked down for almost a year, the Russia-Ukraine region has been in war and the Great Resignation has grown across the world (reducing the number of people in the workforce to lower than pre-pandemic levels), severely limiting supply while demand raged as people started to spend money, catch up on medical appointments and live life again.

Thus, critical shortages and extended lead times remain while there is a glut of inventory in the “wrong” products in the “wrong” place at the “wrong” time, leading to continued disruption, inflation caused by limited supply, and recessionary signals caused by the cost of capital and the oversupply of “wrong” products throughout the supply chain. To make matters more challenging, global tensions are on the rise with China and several other countries that supply essential medical devices, key materials, and active pharmaceutical ingredients, as well as other critical commodities and components.

Inflation, Workforce Issues & Labor Shortages Adding to the Volatility

Inflation, workforce issues and labor shortages are further disrupting healthcare supply chains. The country faces a shortage of up to 124,000 physicians by 2034, including 48,000 primary care physicians, according to the American Medical Colleges. Of immediate significance, according to The American Hospital Association, 136 rural hospitals closed from 2010 to 2021 alone. And, according to the Chief Healthcare Executive, the Texas Hospital Association has warned that 1 in 10 hospitals in that state is at risk of closure, with nearly half of that state’s hospitals projecting negative operating margins. As these medical professional shortages persist and closures occur, patients still require attention. Thus, healthcare is on the move, and the supply chains will have to catch up. Thus, more of the “wrong” items will be in the “wrong” places at the “wrong” time., thereby creating additional disruption, inflation to move and/or transfer them (from one owner to the next), and inventory stockpiles in the “wrong” place.

The Successful Path forward

There will be more opportunity than ever before for proactive, resilient, and innovative companies to gain market share during these volatile times. The successful companies will take control. Starting by targeting their ideal customers, they will focus limited resources on what provides the most value to these key customers, including providing value-add services such as vendor managed inventory so that their customers have the “right” products in the “right” place at the “right” time with minimal resources and risk.

They will go further into their supply chain to assess risk and mitigate shortages of critical components and supplies due to resolvable issues such as delays in transportation and material and labor issues at a third-tier supplier. Reliability will be prioritized over cost, and additional suppliers will be qualified even though the cost and time required is high. Backup suppliers will be scalable to mitigate issues such as those that occurred in the baby formula market. And taking control of essential healthcare supply chains will become a priority as reshoring and nearshoring production gains momentum. For example, Costa Rica and Mexico are building strong medical device manufacturing clusters to support healthcare supply chains. And the successful will deploy technology to support the sustainability and scalability of these initiatives.

It is no longer sufficient to leave manufacturing and supply chain reliability to chance. The proactive, resilient, and innovative will thrive and gain the opportunity to grab market share from those remaining on the roller coaster of volatility. Think ahead, be proactive and be willing to invest in supply chains of the future to support your ideal customers and be uniquely positioned to grow and thrive.

Lisa is founder and president of LMA Consulting Group, Inc., a consulting firm that specializes in manufacturing strategy and end-to-end supply chain transformation that maximizes the customer experience and enables profitable, scalable, dramatic business growth. She recently released SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue and EBITDA Growth as an e-book that can be found at https://www.lma-consultinggroup.com/siop-book/.

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The Global State of Affairs

The bottom line: It is a mess! What is going on? Unfortunately, there is a lot of volatility, and it will not smooth out anytime soon. For example:

Russia/ Ukraine war:

The Russia/ Ukraine war rages on and shows signs of escalation. There are critical commodities in the region, creating scarcity, shortages, and risks for any industry dependent on oil, computer chips, and certain food supply such as grains. The question isn’t who will be impacted; instead, the question is who isn’t impacted! These issues are widespread and will have long-term implications.

China/ Taiwan

Taiwan produces the majority of advanced computer chips in the world. Now that China’s President Xi has been elected to a unprecedented additional term, his plans to take over Taiwan put the region at great risk. What more is there to say? This situation will have far reaching impacts throughout the world.

California Energy Grid & the War on Energy

Why put California’s energy grid in a section about the world? Well, California is the 5th largest economy in the world, and it is a sign of things to come if we continue down this path. The infrastructure is insufficient, and there is no way industry can meet the regulatory requirements coming down the pike on time and yet still serve customers. There is risk on the energy grid, brownouts and blackouts causing issues for essential industries, and yet energy is vital to fueling our way of life. Look no further than Europe. They are struggling mightily to figure out how they will get through the winter season with limited Russian oil and with natural gas pipelines shut off. Yet Germany is a manufacturing powerhouse. It is a volatile mess.

Natural Disasters Such as Hurricane Ian

Weather events and natural disasters are commonplace around the world. Recently, Hurricane Ian pounded the Florida coast. This is a great example as many agriculture products are grown in Florida, and Florida is home to Mosaic Co., which supplies 50% of North American farmers’ supply of granular phosphate fertilizer and 12% of the global supply. Delays and shortages will persist.

Potential Rail & Port Strikes

Although the US delayed a rail strike recently, there is still not a deal. If there is a rail strike, it will have a huge economic impact estimated at $2 billion per day and impacts 30% of the transportation system. This will impact commodities, grains, and much more. The ports are also still negotiating to avert a strike. The unions don’t want automated terminals; however, the US is vastly behind China and other countries in the ability to automate and use advanced technology.

The Great Resignation

The baby boomer generation is retiring rapidly and leaving a wake behind them. The pandemic made people rethink their life and change careers. The talent and skills gap remains a top concern. Additionally, family-owned businesses are selling off in high numbers. The Great Resignation is changing the talent landscape.

What is the bottom line?

We must reshore and nearshore to friendly countries (also known as friendly shoring) immediately!

Essential Industries

Starting with essential industries such as food, healthcare (products, medical devices, medtech, biotech, etc.), energy, water, computer chips, advanced technologies, and industries related to national security, we need to go far beyond putting our toe in the water. We need to gain capabilities rapidly and produce at scale!

Reshape Your Supply Chain

To reshore, nearshore, expand & upgrade manufacturing and supply chain capabilities, you will need to reshape your supply chain. Think about the following supply chain optimization priorities:

• Manufacturing footprint: Where will you produce and invest in manufacturing capabilities? Reshore, nearshore, friendly shore, expand capabilities, find new partners?
• Your end-to-end supply chain: What risks do you have in your end-to-end supply chain? How can you secure supply of critical items?
• Supplier footprint: Does your supply footprint support your manufacturing footprint?
• Suppliers or partners? Who are you partnering with to ensure your end-to-end supply chain performs? To learn more about developing partners over suppliers, read our article in Adhesives & Sealants.
• Logistics partners: Do you have the appropriate partners in place to support your customers and your supply chain partners? Remember, supply chain is a system of systems and partners.
• Technology: Do you have the appropriate ERP, technologies & data and business intelligence systems to support your business?
• Financials: Do you have the appropriate finances in place to support your path forward?
• SIOP Process: Do you have a SIOP (sales, inventory and operations planning) process in place to support highlighting and making the appropriate strategic and tactical decisions to ensure resilience and success in today’s volatile and risk laden environment?

Talent, Talent & More Talent

Talent, talent, and more talent will be needed to make this happen. The war on talent is real. We recommend leaders act quickly:

• Find your stars: In every client in 17 years of consulting, we’ve found a star. Many are overlooked, and so companies have vast potential with underutilized resources.
• Provide mentoring, coaching & training opportunities: They are all quite distinct. Mentoring provides practical examples and is often the best path forward. Coaching provides proactive support, and training can provide new skills. With the fast rate of retirement of baby boomers, JUMP on this while you can.
• Leadership & performance management: Those companies with strong leadership and performance management processes are at least twice as successful as the rest.
• Project management: 80% of success is not in formulation; it is in implementation.
• Supplement your talent: We have been working with several clients to upgrade their processes while also jumping in “hands-on” to support and supplement their resources. Find partners to help design, upgrade, expand, maintain, source, and more. Leverage your options to upgrade and scale more quickly.
• Automate, Digitize & Thrive: Provide the tools and technologies to support your talent.

Path Forward

There will be more risk – and more opportunity – than at any time in history. The strong will get stronger, and the weak will wind down and exit. Although challenging economic times are ahead, the geopolitical risk is even greater. The smart will invest wisely and thrive for decades to come. Will you be on that path?

Refer to our blog for volumes of articles on these topics and read more about these types of strategies in our eBook, Thriving in 2022: Learning from Supply Chain Chaos. If you are interested in talking about how to reshape your supply chain, get in front of it with a SIOP process, and successfully navigate these waters, contact us. 

Did you like this article?  Continue reading on this topic:
The Case for US Manufacturing

The post Taking Control: Reshoring, Nearshoring, Friendly Shoring & Manufacturing Expansion appeared first on LMA-Consulting Group, a supply chain consulting firm.

CLAREMONT, CA—Businesses are taking novel steps to better manage their workforces during the Great Resignation, according to The Society for the Advancement of Consulting® (SAC). The key is to take steps today that deliver long-term benefits for the workforce and sustainable results for the business.

Start by Cultivating the Culture

“Our most successful clients see employees as their #1 asset,” points out Lisa Anderson, president of Claremont, CA-based LMA Consulting Group, Inc. and manufacturing expert known for creating supply chain resiliency. “People don’t leave companies; they leave people. Thus, successful companies prioritize people.

“Strong leaders cultivate an engaging work environment,” she adds. “Focus your employees’ attention on your customers. Show appreciation, recognize progress, and celebrate successes. Have high expectations, discuss performance, and provide immediate feedback. Communicate the vision, explain each employee’s value, and provide flexibility. Build your culture, and you’ll retain top talent and attract new talent while your competition loses to the Great Resignation.”

Raise Your Workforce to the Customer Priority Level

“Business owners and managers have three types of customers these days: the end customer, the supplier, and their workforce,” explains Kathleen McEntee, President of Kathleen McEntee and Associates, Ltd (KMA), a full-service marketing firm known for developing strategies and tactics that distinguish its clients from competitors. “Treating the workforce with the same priority level as end customers is critical in retaining and attracting the right workforce.

“Better management of a workforce requires flexibility, setting expectations, follow through and communication,” she says. “Remote work is no longer a privilege; it’s a must. Setting clear goals and expectations provides direction. That allows employees to see how they fit in the big picture. A big criticism of managers is a lack of follow-up or feedback. But feedback is vital to keep employees on track and engaged.”

“Regular communication that reaches every employee is key. It’s not only what you say, but how you say it. That’s tricky, with four generations in the workforce today. Nevertheless, it can and is being done,” claims McEntee.

Two Steps that Make Employees Want to Work with You

“The great resignation is a wake-up call for organizations to finally address the issue of culture,” notes Jo-Anne Hill, founder of JH Hospitality Consulting, which helps organizations improve revenue and profitability. “Defined as ‘how things are done around here’, it takes time, attention, and financial support to create a positive, empathetic culture. Ignoring culture breeds an environment of mistrust and fear, which is why companies are seeing the mass exodus of employees. Leadership has a choice to make.

“The first step is the commitment of the most senior person, typically the CEO, to model the way,” she says. “Once confirmed, ask employees for their feedback and suggestions on how to improve the working environment. This process calls out poor leaders and begins to melt the fear that impedes productivity.”

“These two steps begin the transformation journey to create an environment where employees want to come to work,” adds Hill. “Byproducts are reduced recruitment costs and transition downtime, making everyone happier—from the front-line worker to the C-suite executive.”

Design Meaningful and Humane Work

“As businesses face high levels of employee turnover, headlines are filled with stories about The Great Resignation,” says Dr. Maynard Brusman, a San Francisco Bay Area consulting psychologist and executive coach.

According to Dr. Brusman, “For companies experiencing retention problems, I recommend that mindful leaders reach out and listen to engage employees, which is crucial in times of disruption. Engaged employees perform better, experience less burnout, and are more committed to their organizations. Connect with what employees care about and their core values.”

Dr. Brusman advises his executive coaching clients, “Create a culture of belonging and psychological safety. Enable workers to satisfy the human need for autonomy, choice, and control, which build high self-worth.”

Look at the Places with No Great Resignation

“The Great Resignation is not ubiquitous. In Germany for example, only one in ten skilled workers plan to resign—far fewer have left,” says Steven Hunt, founder of Steven Hunt & Associates, and expert advisor to top management on how to get workers motivated and focused on growth across global business units. “Resignation rates are below average. Loyalty is high because bosses invest in workforce development, skills, and employee benefits.”

“Where employees are leaving, it’s for two reasons,” he says. “The first is managers with low emotional intelligence. Selfish and self-absorbed managers are a big turn off and quickly drive people away. Second, employees’ frustration is rising with business leaders who struggle to manage digital transformation, particularly across global functions. Top managers who cannot implement a digital workplace are losing workers to companies that are already managing digital transformations well.

“The three biggest levers managers have in hand are to invest in the workforce, show interest in employees, and lead effective digital transformations,” advises Hunt.

Great Brands Always Attract Great Employees

While many businesses struggle to maintain their workforces, others continue to attract talented employees who are eager to work. A key difference is how organizations empower employees to deliver the promise of a strong brand, according to Linda Popky, president of Redwood Shores, CA-based strategic firm marketing firm Leverage2Market Associates, and author of the book Marketing Above the Noise: Achieve Strategic Advantage with Marketing That Matters.

“Organizations that are focused on offering true value to their customers know it’s impossible to have happy customers with disgruntled employees,” she says. “That’s why they make employees feel well-valued and compensated for their efforts, and those employees feel good about coming to work and being associated with that brand.

“The pandemic has forced many people to reevaluate their working conditions—they’re no longer satisfied to “ make do” with difficult situations, with jobs that don’t compensate well, or where they don’t feel energized and appreciated. Now’s the time for smart organizations to take the steps to live by their chosen brand values—and make their team members a key part of the process,” she adds.

Think About Future Talent—Not Restoring the Past

“Don’t assume that your workforce needs to be ‘restored’ in some way,” says SAC Founder Alan Weiss, PhD. “Ask a different question: What kind of talent will I need for what kind of value creation in the next year? You might find that it’s time to rethink staffing altogether.”

Originally posted on SAC website: April 2, 2022

The post SAC: Successful Organizations Move Beyond the Great Resignation appeared first on LMA-Consulting Group, a supply chain consulting firm.

Supply chain is dominating the news. Demand is soaring, ports are backed up, container prices are soaring, shipping costs are skyrocketing, warehouses are full, and manufacturers are experiencing extended lead times across the board. The end-to-end supply chain challenges are exacerbated with the great resignation of people. Unfortunately, these issues are not going away anytime soon. We will talk about the current state of the supply chain, and more importantly, what executives should be doing to survive – and thrive – during these volatile times.

• Strategies to retain, develop and attract talent during the great resignation
• The regionalization of manufacturing and the great migration back to local
• Digitization of the supply chain and turning data into insights
• The resilient supply chain and how Sales, Inventory & Operations Planning (SIOP) can help you scale and serve customers
• Innovate to thrive

Lisa Anderson President of LMA Consulting Group, will discuss what supply chains will look like in 2022.

Click here for the full story.

The post What will supply chains look like in 2022? appeared first on LMA-Consulting Group, a supply chain consulting firm.

“The end-to-end supply chain challenges are exacerbated with the great resignation”, comments Manufacturing and Supply Chain Expert, Lisa Anderson, MBA, CSCP, CLTD, president of LMA Consulting Group Inc.

Supply chain is dominating the news. Demand is soaring, ports are backed up, container prices are soaring, shipping costs are skyrocketing, warehouses are full, and manufacturers are experiencing extended lead times across the board.

The end-to-end supply chain challenges are exacerbated with the great resignation of people. Unfortunately, these issues are not going away anytime soon. We will talk about the current state of the supply chain, and more importantly, what executives should be doing to survive – and thrive – during these volatile times.

• Strategies to retain, develop and attract talent during the great resignation
• The regionalization of manufacturing and the great migration back to local
• Digitization of the supply chain and turning data into insights
• The resilient supply chain and how Sales, Inventory & Operations Planning (SIOP) can help you scale and serve customers
• Innovate to thrive

Click here for the full story.

The post Today’s Medical Developments: A Look at the Supply Chain Entering 2022 appeared first on LMA-Consulting Group, a supply chain consulting firm.

Labor shortages exist in almost every industry and position. Manufacturing, transportation, distribution — none of these industries are exempt. And, most of these industries affect the consumer, who has felt the supply chain pinch the worst, said Lisa Anderson Manufacturing and Supply Chain Expert, MBA, CSCP, CLTD, president of LMA Consulting Group Inc..

Click here for the full story.

The post ACHR News: Distribution Trends November 2021 Roundup appeared first on LMA-Consulting Group, a supply chain consulting firm.

What do key business leaders think is next? That was the subject of one of the sessions at the premier conference for consultants. If you are a consultant and want to thrive (instead of having fits and starts as is the norm), this organization is a must! We gathered virtually with colleagues from at least seven countries around the world and had an array of outstanding speakers. We talked about how to help our clients take advantage of the rebound.

We heard from executives in building and construction products, healthcare, and non-profit as well as experts in collaborating across borders, subscriptions, scaling up and much more. The themes of talent, digitization, resiliency, sustainability, and innovation rose to the top. Are you thinking about how to thrive during the rebound?

One Tip to Implement This Week:

Simply thinking about these themes and how you should apply them can go a long way towards success. Thus, I will provide a few key insights to ponder.

• The Great Resignation: There is a LOT of conversation about this topic. 11.5 million people quit their jobs during April, May and June, and this has been outdone by August’s numbers of 4.3 million in one month alone! Also, 48% of people are actively considering leaving, and it is estimated that 1 in 4 will do so within 6 months. If you are to succeed, you must retain, develop and attract people.
• Turn data into insights: I loved this phrase that the Global CIO of Abbott and completely concur. There is no doubt about it that clients are FAR more successful if they can use the mountains of data available in today’s environment, decipher meaningful insights and turn into strategies and actions.
• Innovation: Are you involving your people in thinking outside the box for creative ideas and strategies to make meaningful change to your organization, your customers and people’s lives? Engaging your people in the future is essential to thriving during this rebound.
• Supply Chain: Of course, I love that manufacturing and supply chain is gaining appreciation throughout the world. There are widespread shortages of people at each step in the supply chain from ports to transportation to warehousing as well as shortages of equipment, space and much more. Are you proactively managing demand and supply with SIOP? If not, you will certainly be left behind.

The bottom line is we have to be more proactive, innovative and collaborative to thrive during and post the rebound. Please keep us in the loop of your situation and how we can help your organization successfully navigate the current volatility and emerge above and beyond. Several of these types of topics are included in our new eBook Emerging Above and Beyond: 21 Insights for 2021 from Manufacturing, Supply Chain & Technology Executives. Download your complimentary copy.

The post What Key Business Leaders Think Is Next appeared first on LMA-Consulting Group, a supply chain consulting firm.

“Baby Boomers with a significant knowledge base are retiring at the rate of 10,000 a day.”

No manufacturer can ignore the urgency of that figure.

The quote comes from manufacturing and supply chain expert and president of LMA Consulting Group Inc. Lisa Anderson. She has Boomer retirements topping her list of reasons for the widening skills gap.

Making matters worse is the gap in skilled trades such as CNC operators. Anderson bemoans the lack of focus on high school and community college career paths into manufacturing, citing industry leaders’ unwillingness to invest in solving the problem.

“Those that find a way to bridge this gap have a leg up on the competition,” she observes.

She advises partnerships to counter the skilled-jobs deficit. “Successful executives have set up programs with local community colleges, partnered with trade associations such as the Association for Supply Chain Management (APICS), [and others].”

Further evidence of the problem’s severity is revealed in the 2020 Ohio Manufacturing Survey, conducted by the Manufacturing Advocacy and Growth Network (MAGNET), a resource to help manufacturers grow and compete in Northeast Ohio.

The survey of more than 670 companies statewide represents more than 128,000 of the state’s 700,000 manufacturing workers. Almost 6 in 10 report the skilled worker shortage is hampering their growth, with more than 1 in 4 indicating they are challenged by current worker retirements. While manufacturers are concerned about finding and hiring skilled workers, only about one-third of companies are actively innovating the way they recruit and retain employees.

Hiring strategies continue to focus on traditional sources: 88% use employee referrals, 83% use job postings, 62% use staffing agencies, 44% work with high schools, and 37% work with community colleges.

Click here to read more.

Published in Aerospace Manufacturing & Design on Feb. 25, 2020

The post Aerospace Manufacturing & Design: 10,000 a Day appeared first on LMA-Consulting Group, a supply chain consulting firm.