Lisa Anderson was quoted in Manufacturing Dive about how manufacturers can navigate a slowing economy.

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Big brands are laying off workers amid lagging demand. But experts say there are more strategies that can help keep teams nimble for an economic turnaround.

As the economy stagnates and global factory activity remains slow, some manufacturers have taken drastic steps to quickly cut down on costs by laying off workers and closing facilities.  

Stationary bike maker Peloton’s manufacturing subsidiary Precor announced in March that it would close its factory in North Carolina and lay off more than 100 employees.

U.S. EV manufacturer Lucid said it would lay off about 18% of its overall workforce last month, and Solo Cup manufacturer Dart Container Corp. laid off 84 workers. The tools-maker Stanley Black & Decker said it would close two facilities in Texas and South Carolina, too.

Manufacturers are making these decisions as consumer spending — which surged during the pandemic — returns to past norms and demand slows.

Still, headlines about layoffs and factory closures may not fully reflect the current state of U.S. manufacturers, said Chad Moutray, the chief economist at the National Association of Manufacturers. Despite concerns about a potential recession, Moutray argued that manufacturers are coming off a remarkably successful few years and that the current surge in layoffs isn’t particularly centralized in the manufacturing sector.

the shortage of skilled workers may be a reason to avoid layoffs and hold on to as many permanent employees as possible, said Lisa Anderson, founder and president of the supply chain and manufacturing consulting firm LMA Consulting Group. While manufacturers are understandably nervous about the impact of declining orders on their bottom line, there are also other strategies to prepare for a slower economy, she explained.

Originally published in Manufacturing Dive, April 18, 2023

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Israel was attacked by Hamas, and the world has another war in another region of the world. Since the global supply chain is interconnected, in addition to the devastation in the region, supply chain impacts will emerge. As I discussed with the Los Angeles Business Journal earlier this week, supply chain disruptions will impact every partner connected to the region in the end-to-end supply chain and/or those that must travel through the region.

Labor Shortages

Israel is already affected as companies are saying that employees are part of a mass call up of army reservists. Labor shortages were already causing challenges throughout the world; as key high-skilled labor must participate in the war, businesses will be impacted. In addition to labor shortages, Israel is a hub for advanced computer chips. In fact, it is one of the key regions aside from Taiwan for advanced chips. Intel produces chips for AI and self-driving cars. Nvidia produces chips for AI, and Apple designs some of its silicon in Israel.

Hub for Advanced Computer Chips

In addition to labor shortages, Israel is a hub for advanced computer chips. In fact, it is one of the key regions aside from Taiwan for advanced chips. Intel produces chips for artificial intelligence /AI and self-driving cars. Nvidia produces chips for AI, and Apple designs some of its silicon in Israel.

Import/ Export Impacts

Israel’s imports and exports are impacted. For example, Israel has significant trade with India, increasing from $200 million in 1992 to $101 billion in 2003. Israel exports fertilizer, electronic components, petroleum, and agro-chemicals. Other import/ export items include chemicals, plastics, metals, medical and industrial equipment and more.

Regional Impacts

Israel is in a critical region of the world known for producing oil. Since energy is vital to fuel manufacturing and supply chain, it is important in fueling the world. If the war in Israel expands beyond the country’s borders, it can pose a risk to two key shipping choke points: the Suez Canal, a key waterway for all types of commercial container ships, and the Strait of Hormuz, which is pivotal to oil and gas shipping. 

Impacts on the Supply Chain

In thinking about Israel’s impact on the region and the world, it is clear that many supply chain disruptions are likely to emerge. If your supply chain is dependent on a trading partner of Israel such as India, you could be affected. If you are dependent on advanced computer chips, your supply chain will be impacted, even if you get your chips from Taiwan.

Anytime there is a disruption in one node of the supply chain, it can expand to all nodes connected to that node. Almost every manufacturer and logistics organization is dependent on oil and natural gas and will be indirectly impacted with higher prices at a minimum. Equally concerning would be an expansion of the war that impacts the Suez Canal. We have evolved into a globally-connected supply chain, and successful executives will rapidly determine their risks and mitigate them.

Strategies for Success

Every forward-thinking organization is getting on top of their end-to-end supply chain. You need something like a supply chain control tower to keep track of potential risks and impacts with changing conditions so that you can successfully navigate changing circumstances. It is no longer for the large global organizations. If you want to succeed, you will dedicate resources to monitoring your supply chain.

Uncommon common sense will prove essential in the years to come. Sourcing backup materials and logistics suppliers is simply required. Knowing your partners will be essential. Since your viability might be dependent on your suppliers, you should determine if they are trustworthy, financially viable, and innovative. Thus, although having access to multiple suppliers in various regions is important, you will also have to consolidate efforts to just those that meet your requirements as a partner, not just a transactional vendor.

Smart executives are also pursuing reshoring, nearshoring and friendly shoring programs. To learn more about what the most successful companies are doing, read our special report, “The Road Ahead: Business, Supply Chain & the World Order“. Unless you can afford to risk your customers, you must take control of your supply chain. Don’t forget to evaluate geopolitical risks, energy, natural resources, and supplier networks as you pursue these strategies.

Following a SIOP (Sales Inventory Operations Planning) process that is forward-thinking and predictive to develop demand plans and sales forecasts is becoming even more vital. With heightened supply chain and geopolitical risk, the lack of resources and labor shortages, and escalating costs, only those that look forward and plan for how they will fulfill their orders profitably and with high service levels will succeed. They will be evaluating customer and product profitability, manufacturing capacities and capabilities, supply chain networks, pre-positioning of inventory and capacity, and the required resiliency to best support customer needs.

The Bottom Line

The supply chain is interconnected globally. A ripple in China can impact Europe. A weather event in Japan can influence the U.S., and a war in the Middle East will impact every region of the world. Assess your supply chain, its interdependencies, and your alternative and backup options. Put it together into a strategy and path forward to ensure you can meet your customer needs and deliver bottom line results.

If you are interested in reading more on this topic:
Supply Chains are on the Move

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Although the supply chain challenges have abated since the COVID-19 pandemic, disruptions continue to persist and risks have increased. VUCA (volatility, uncertainty, complexity, ambiguity) has increased substantially in the world, negatively impacting the safety, security, and reliability of the supply chain. Successful executives are creating resilient supply chains to navigate these changing conditions, while the best find ways to create an advantage for future growth.

Most of the supply chain challenges have eased, creating an unrealistic expectation of normalcy. Yet, the risks still exist and remain elevated. Geopolitical tensions are high: The Russia-Ukraine war continues to rage, and Taiwan-China tensions are simmering. This leads to disruptions and shortages that don’t adequately support growth in customer service requirements, let alone overall growth trends in medtech.

Material Influences

Alloys are commonly used in medtech, but most are heavily concentrated in geopolitically challenged zones. Aluminum, for example, is used in many medical devices, yet the world’s top aluminum producers are China, Russia, and India.

Titanium is another key alloy used in medtech products, but the United States mostly sources the material from Japan, Ukraine, Russia, and other countries. The United States does not include titanium in the National Defense Stockpile. The reason for its absence is a mystery.

Cobalt—frequently used in such medical devices as hip and knee implants, surgical tools, and vascular stents—is sourced from the Democratic Republic of Congo, Russia, and Australia. The common thread with most of these alloys is their manufacturing base, which is concentrated in geopolitically challenged areas. Consequently, forward-thinking manufacturers must focus on the resiliency of these supply chains in order to avoid further disruptions.

Plastics—also used widely in medical devices—are derived from natural, organic materials such as cellulose, coal, natural gas, salt, and crude oil. However, the planet’s natural gas and crude oil supply is currently impacted by geopolitical events like the Russia-Ukraine war and regulations. The United States has limited crude oil production in order to save the environment but in doing so, it has become partially dependent on other countries and therefore is experiencing much more volatility in pricing and inflationary pressures. This limited supply and inflationary pricing will eventually be passed on to medical device manufacturers, potentially leading to cost-cutting pressures and inventory reductions. Unfortunately, this can become a circular issue because it leads to additional supply chain disruptions and a lack of agility in navigating these risks.

The dwindling reserve of computer chips during COVID-19 greatly impacted the medtech supply chain as well. Availability has eased considerably since the pandemic’s darkest days, when manufacturing in Asia ground to a near complete halt. It took quite a while to get supply moving again once the world reset, as China was plagued with intermittent Zero-COVID policy shutdowns. According to an April 2022 Deloitte study, more than 50% of respondents single-sourced semiconductors, although all were pursuing alternative suppliers. Such alternative sources were difficult to find, as 90% of the world’s advanced computer chips are produced in Taiwan and the largest overall producers are Taiwan, Japan, China, and Korea. Since the chip shortage, the United States has made significant investments to expand semiconductor manufacturing capabilities.

Labor Pains

There are a plethora of other reasons for continued supply chain disruptions. Labor strikes, for instance, can be particularly disruptive to supply chains. Both rail and UPS strikes were averted in the United States this past summer, but West Coast Canadian ports went on strike until a tentative deal was reached. The Southern CA ports reportedly have a tentative deal, but it hasn’t yet been ratified.

Since manufacturers cannot afford to be solely reliant on logistics providers that can bring production to a halt with foreseeable consequences, cargo volumes have been moving from the West Coast to the East Coast as a preemptive move. These types of changes occur frequently, which alter the global supply chain footprint and create additional disruptions. Proactive device companies will be able to successfully adapt to these changes with minimal impacts while unprepared firms will caught off-guard and risk losing business.

Labor issues remain a considerable pain point for the medtech industry as well as almost every manufacturing segment worldwide. Recruiting the appropriate amount of people to manufacture, distribute, and transport products is challenging, and can significantly impact a company’s ability to support customer requirements. The opening of a new semiconductor facility in Arizona, for example, has been postponed by a year due to labor challenges. The most successful companies find the best way(s) to attract, retain, and engage their employees and partners.

There is no shortage of potential supply chain risks and issues to address. Our most successful clients are turning these obstacles into opportunities by getting ahead of the game and preparing for success. Given the abundance of risks, a disruption will undoubtedly arise somewhere along the line, impacting competitors and other industry players. The best industry players will be prepared to absorb volumes from their struggling cohorts and service their customers. These companies will grow, expand their market share, and prosper. There are likely to be more opportunities for growth than at any other time in history for medtech organizations prepared for success and ready to take the plunge.

Although there is no shortage of supply chain improvement opportunities, it will be important to focus on the top priorities to gain maximum momentum. Otherwise, if everything is a priority, nothing is a priority. One priority across the board is to review supply sources. Securing backup supply alone will not suffice. Given the level of risk, at some point in the future, when things go wrong, it will not be feasible to secure supply at the scale required to satisfy demand unless a more robust plan is in place. For example, the best clients will purchase 20% continually from their backup supply sources so these sources can help them in the future.

Although the backup source may have to double or triple volume for a period of time, it is unrealistic to do that for extended periods of disruption. Thus, this strategy must be accompanied with additional methods.

Diversifying and expanding supply sources will be essential to prepare for success as opportunities arise. Smart executives are researching what makes sense in their industry, for their products, and given their supply chain footprint and expertise. One size doesn’t fit all. Medtech manufacturers are moving production and/or expanding capabilities in countries that support North American customer requirements. Mexico, Costa Rica, and the Dominican Republic are gaining significant volumes but they cannot produce to scale for the North American market rapidly. Mexico has the best opportunity as that country has experienced resources and is in close proximity to the United States.

Reshoring is another alternative. In today’s digital, automated, and robotic world, labor costs are not nearly as relevant. With investment in a culture of innovation as well as a deep dive into manufacturing and supply chain advancements and technologies, expanding U.S. manufacturing can be the best option. Reshoring enables companies to control their ability to scale up to meet customer demand and to control costs and inventories when scaling down. Investing in the appropriate technologies to improve the customer experience while minimizing labor and maximizing output will give medtech firms an advantage in the marketplace.

Reshoring in a regional cluster can provide further advantages of scale, flexibility, and responsiveness, resulting in rapid product development, quick problem resolution, and collaborative innovations, thereby improving margins.

Another critical supply chain process is SIOP (sales, inventory, operations, planning). SIOP will be essential in supporting an agile and forward-looking supply chain because it continually monitors changes to customer demand, changes in the business environment, how demand stacks up against manufacturing capacity and other sources of supply, and the risks and costs associated with alternate strategies. It also brings visibility to key strategic decisions so alternatives can be evaluated, and new options/ strategies developed. Most importantly, the process forces the organization to think about the future, evaluate and prioritize risks, and provides guidelines for decision making to ensure profitable growth and scalability.

Smart executives will establish a control tower to monitor their supply chain to ensure speed of responsiveness and resiliency. Although these actions will be essential to improving performance, the best, forward-thinking executives will take advantage of the disruption and confusion to turn disruption into opportunity. Preparation, innovation, and forward-thinking will create medtech’s future leaders. 

Originally published in MPO – Medical Product Outsourcing, 9/25/2023

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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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Since I was preparing for a meeting related to healthcare supply chains, I dug deep into the topic and thought it would be valuable to share the findings. In reviewing baby Tylenol /Motrin to adult diapers to medtech and pharmaceticals, supply chain disruptions have eased in some areas but continue in many others. As is typical in supply chains, the disruptions and issues move, but they have not disappeared.

Healthcare Supply Chain Examples

Several key points emerged from a review of of the the healthcare supply chain.

• Baby Tylenol & Motrin shortages: It has been blamed on a spike in fevers: however, uneven demand (for when illness will occur) is quite normal and will not ease. Inventory was simply not available in the “right” place at the “right” time, stemming from supply chains reliant on China which were negatively impacted with Zero-COVID policies with insufficient inventory and/or capabilities to compensate for these disruptions.
• Doctor’s offices & hospital systems: Although shortages have eased, sporadic shortages of critical items remain. From crutches to surgical supplies, items are not available in the “right” place at the “right” time. Again, manufacturing and inventory policies should be reviewed.
• Labor shortages abound: No matter which area of healthcare, everyone mentioned labor shortages. There simply aren’t the appropriate skills and resources in the “right” place at the “right” time to keep healthcare systems running smoothly. I have experienced this frustration as well!
• Taking control of manufacturing: It came up in medtech, but also in several other sectors. There is interest in reshoring, nearshoring, friendly shoring, expanding capacity, and sourcing new suppliers. In essence, there is a mantra of producing in “Asia for Asia”, “America for America”, etc. The bottom line: Reduce the risk in supplying customers.
• Regional/ local supply chain: In the same vein of taking control, companies are also focused on sourcing closer to supply hubs. For example, in a healthcare manufacturer, they have found a local supplier to fabricate and procure most parts needed for upgrades to machines. That has made a significant difference in mitigating long lead times and successfully serving customers.
• Pharmaceutical: There are definite concerns about the active pharmaceutical ingredients (APIs) risks concentrated in China and India. Beyond that issue, there are significant price increases in certain raw materials such as chemicals. Also, even though there is a high cost and long lead time to qualify new suppliers, companies are biting the bullet and pursuing alternatives. Additionally, to manage risk, supply chain professionals are looking further into their supply chain to mitigate risk. Otherwise, disruptions will continue.
• Reliability remains key: No matter the sector, there are concerns with reliability. Reliability is trumping cost. If air is more reliable than ocean containers, companies are sticking to air. If trucking is more reliable than rail, they will stick to trucking. If reliability cannot be attained, the source of supply is being evaluated.
• Capital equipment sector: is loosening up a bit.

Disruptions continue. Unfortunately, they simply continue to move. It seems a bit like that Whac-A-Mole game. What are the successful doing to resolve this issue?

Common Theme Emerges: Taking Control

The common theme is that those executives and companies taking control with proactive strategies are overcoming most of these challenges and are thriving in comparison with the competition. There isn’t just one way to take control. You could source additional suppliers, add capabilities, insource production, supplement internal resources, and there are many more options to pursue. Of course, the successful are not just taking control. They continue to prioritize service, manage margins and profitability (ie. pursuing cost reduction programs especially those that can achieve a win-win, adjusting pricing, etc.), and right-size inventory to manage cash flow. The “trick” is to achieve all three simultaneously.

Please keep us in the loop of your situation and how we can help your organization get in a position to thrive for years to come. Several of these types of topics are included in our eBooks. Download your complimentary copy.

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Lisa Anderson was quoted in USA Today about the current state of the supply chain and how it could impact the holiday season.

“Despite some easing of backlogs at the nation’s ports and retailers reporting they were flush with inventory this summer, supply chain woes are expected to persist as the holiday shopping season gears up earlier than ever. 

‘Supply chain issues are here to stay,’ said Angeli Gianchandani, professor of marketing at the University of New Haven’s Pompea College of Business. ‘Everything is fragile now, our supply chain is fragile, our crops are fragile … Labor is fragile,” she said. “Everything is colliding now. It’s the perfect storm.’

That storm includes global events like the war in Ukraine and China’s zero-COVID-19 policies causing manufacturing shutdowns, as well as an actual storm. 

The Category 4 Hurricane Ian has led to increased demand for some products needed for recovery efforts, as well as stranded or destroyed equipment and materials, putting a strain on other parts of the supply chain, said Lisa Anderson, a supply chain expert and president of LMA Consulting Group.  

It’s not all bad news though, consumers may be able to take advantage of deals from retailers who need to move excess product that came in late last year.”

To read the full article, click here.

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In this episode of Interlinks, we’re going to check in on some of the major global regions, namely Europe, North America and Asia Pacific, to see what is going on and what is topical in supply chain in summer 2022.

We’re also going to touch on what companies are doing more generally to overcome the challenges posed by inflation and the shortages of human resources that are generalized across the major regions at the moment.

To discuss these topics, I’m joined by two of my supply chain consultant colleagues from the supply chain special interest group from the Society for the Advancement of Consulting (SAC), Lisa Anderson, president of LMA Consulting Group from the Los Angeles Metro area and David Ogilvie, principal at David Ogilvie Consulting in Brisbane, Australia.

Originally published on Interlinks, August 15, 2022 .

Click here to download.

Click here for the transcript.

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The situation is not good. From Southern California to the Midwest to Ireland or Latin America (let alone Asia), the supply chain remains in chaos. We’ve attended several conferences, worked with clients, and collaborated with colleagues and trusted advisors related to e-commerce, logistics, manufacturing and the supply chain, and our takeaways aren’t telling a good story:

• Bullwhip effect/ roller coaster ride: The supply chain remains out of alignment, spurring further disruptions as companies try to figure out how to get the right products to the right place at the right time while not losing their shirts in terms of profitability and cash flow. The volatility in demand and supply throughout the supply chain is unprecedented.
• Cargo backup-up’s, historic dwell times, & empty containers everywhere: Empty containers remain a BIG issue, creating chassis shortages and furthering misalignment. There are also rail delays, labor shortages, productivity issues, port congestion, and a host of other issues.
• E-commerce is insane: E-commerce is expected to grow to 26% of retail sales by 2025 and is already overwhelming transportation/ last mile, warehousing (no space is available), labor and/or automation needs (as it is far harder to ship pieces than boxes), etc.
• Gas prices: Not only is inflation running rampant, but increasing gas prices are driving truck drivers out of business. In the last two days, I’ve heard from multiple sources that truck drivers are hanging up their hats especially those supporting the agriculture industry as they cannot stay in business with the price increases.
• Regulations driving businesses out: In high-regulatory states such as California, there are dizzying regulations coming down the pike. Worse than the number is the feasibility of the supply chain to meet the standards by the due date. In many cases, even though there has been tremendous progress and investment, there is no way to meet the regulations. For example, truckers will be dropping like flies as regulations take place as early as 2023. Whereas autonomous and electrical vehicles are progressing but not nearly fast enough to meet these deadlines, and it won’t matter anyway as the appropriate infrastructure to support progress cannot keep up.
• Shanghai lockdown: Shanghai has been on lockdown for months. Although it is starting to open up, there is an overload of container ships waiting at port. A tsunami will be on the way to U.S. ports shortly.
• L.A. & L.B. port labor negotiations: Although L.A. and L.B. were ranked least efficient, there are concerns of more demands from the labor unions as volumes have been robust. The situation could get worse with the labor negotiations, further delaying cargo at our busiest ports (supplying 40% of the products to the U.S.). Customers are moving freight east in case negotiations go awry; however, it is creating a backlog at other ports and making a tiny dent in the incoming tsunami.
• Russia-Ukraine war impacts: Any products and agriculture items produced in Russia and Ukraine are going into a state of chaos.
• Baby formula shortages: Although the Abbott plant is starting to come back online, there are no quick fixes to suddenly produce (or ship from Europe and Australia) 3-4 months of production (equating to 40% of U.S. volume). It will take time.
• And now there is a tampon shortage: Due to shortages of raw materials, labor, and other factors, the store shelves are sparse in the tampon aisle, spurring panic buying of favorite brands, which further exacerbates the issue.

And the list goes on….. There is no end in sight. Successful companies will not wait for the global supply chain to realign. Unfortunately, you are only as successful as your weakest link in the supply chain.

The Strongest Link in Your Supply Chain

The successful companies will not only strive to be the strongest link in your supply chain, but they will ensure that the weakest link doesn’t send their customers to the competition. You have a once-in-a-lifetime opportunity to secure your position as a market leader and thrive for years to come, if you choose to take advantage of the opportunity and start to act NOW. The proactive, innovative, and collaborative companies that see opportunities that others miss, invest (in people, processes, technologies, trusted advisors, equipment, etc.) when others don’t, and are willing to take smart risks when others shy away will be successful. Our belief is that these companies will lead for decades in the future. Are you interested? If so, become the strongest link in your supply chain and take control of your future.

How Do We Take Control?

There are several strategic decisions you should be evaluating immediately:

• Which customers do you want to keep? Which do you want to eliminate?
• Which customers do you want to target?
• Which products and services do these target customers need currently? More importantly, what will they need in 1, 5, and 10 years?
• Are you innovating and collaborating with customers?
• How should these strategies translate into pricing and priorities?
• Which products do you want to control? Which are strategic to your customers?
• Which new products and services should you design and develop to support these needs?
• How can you reduce what took 4 months to 4 hours? (across the board)
• Which products should you rationalize?
• Where should you locate your plants to best support your business?
• Should you reallocate production among your plants?
• Where should you position inventory and capacity in your end-to-end supply chain?
• Which suppliers are considered strategic? Where are they located? Are you treating them as a vendor, supplier, or partner?
• Are you innovating and collaborating with suppliers?
• What risks should you evaluate and address in your end-to-end supply chain?
• Should you add, consolidate, or change your distribution network to support your customer needs and to maximize profit?
• Should you insource or outsource?
• Who are your transportation partners? Are you aligned in supporting future customer needs?
• Which systems and technologies do you need to support your future customer and supply requirements?
• Are you thinking 3 moves ahead as it relates to your employees? Those with talent will thrive; those without will struggle and decline.
• Do you have a Sales & Operations Planning process (S&OP), also known as SIOP (adding inventory into the title) to align your demand with supply, and most importantly, to keep your demand and supply aligned with growing revenue and EBITDA.

Don’t spent months evaluating; however, don’t jump to decisions and waste precious talent and resources. Instead, perform a rapid yet broad (deep and wide) assessment of your opportunities, your current position, your target position, and the critical priorities to ensure your strategy comes to fruition. Typically, plans don’t fail in formulation (although we are in a high stakes time frame), they fail in implementation. What resources will you need to ensure success?

Please keep us in the loop of your situation and how we can help your organization thrive during these times of volatility and disruption. There will be more winners created than at any other time than since emerging from the Great Depression. To gain additional ideas and insights on how to best navigate these volatile times and thrive, read our new eBook Thriving in 2022. Learning from Supply Chain Chaos. Download your complimentary copy.

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