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How to Manage and Overcome Disruptions in the Supply Chain

disruptions

How to Manage and Overcome Disruptions in the Supply Chain

Regardless of the type of disruption, supply chain resilience is highly dependant on several factors, one of which being reliable end-to-end visibility created at the first sign of trouble. Whether it’s a health crisis, a series of policy changes, or other forms of disruption, proactive rather than reactive measures are critical in staying afloat when facing a variety of disruptions or bottlenecks.

Disruptions in the modern supply chain are simply inevitable and require a different approach in data management and predictability to successfully overcome the challenge at hand.  By effectively utilizing technology tools available and developing a solid crisis plan can make a significant difference in recovery times.

Below is a helpful infographic from DiCentral breaks down various predictable and unpredictable supply chain disruptions and what it takes in the planning, reaction, and response stages of managing and navigating challenges.

risk mitigation strategies

Moving Past COVID-19: Risk Mitigation Strategies to Drive Supply Chain Resilience

As the world begins to ease movement restrictions imposed during the COVID-19 pandemic, companies are wondering where they go from here and how they can reduce risks moving forward.

These questions are especially relevant to supply chains, as the pandemic disrupted trade flows across borders, from raw materials to finished products. The initial decline in production in China rippled across the world, as the country sits at the heart of many global manufacturing networks. As the virus spread west, more nations instituted lockdowns to protect public health, leading to an increase in factory closures and a sudden drop in consumer demand.

The shock to the global economy was breathtaking in both scope and speed. The search for efficiencies within disrupted supply chains is now driving organizations to look at the lessons that can be learned, in order to better manage and mitigate risk of disruption from future events.

Before you develop risk mitigation strategies, you have to first understand how your suppliers were affected by the pandemic. Are they considered essential? Did they have trouble sourcing raw materials or run low on critical inventory? Did they suffer a shortage of labor due to workers falling sick? Did they face transportation issues?

Once these questions have been answered, then you can start developing and implementing risk mitigation strategies: from immediate actions to enhance supply chain resilience and reduce future supply bottlenecks, to longer-term strategies that require a greater investment of time and resources.

Short- to Medium-Term Strategies

1. Develop a supply chain risk monitoring program

If not already in place, companies should integrate risk management into their supply chain, sourcing strategies and ongoing category management processes. A comprehensive risk monitoring framework should capture the following key elements:

-Understanding the critical risk-prone categories and level of risk across the supply chain

-Regular monitoring of different risk types across suppliers – going beyond just financial indicators, to cover operational, compliance, strategic and geographic risks

-Scenario and contingency planning for unforeseen situations

2. Identity alternative logistics partners for future contingencies

Companies trying to recover from economic lockdowns will face hurdles in shipping markets roiled by deep capacity cuts and weeks of disruption. Airfreight could be constrained for months as airlines continue to operate reduced schedules. Identify and qualify alternative logistics providers to mitigate service failures by an existing partner.

3. Shift supplier base to other low-cost countries

The drop in exports from China in the first quarter led to a significant increase in sourcing from other countries for many product categories. American and European manufacturers started sourcing raw materials and goods from low-cost countries such as India, Vietnam, Bangladesh and Turkey. A diversified geographical sourcing strategy is an effective way to ensure supply chain continuity. Larger companies are leading the charge in this respect: Apple, for example, recently pledged to invest more in Vietnam.

4. Adequate focus on ensuring compliance with new regulatory norms

Companies need to assess new regulations put in place by regulatory bodies across the globe, and identify those that impact their supply chains, manufacturing processes or end products. Dedicating time and resources to reviewing and adapting existing procedures will be critical to ensure compliance with the latest requirements.

Long-Term Strategies

1. Implement a Direct-to-Consumer (DTC) model for uninterrupted supply

COVID-19 has affected many e-commerce businesses as well as how consumers shop. Brands need to be agile and able to move at speed to find and meet demand. Many B2C businesses (and their partners) are pivoting to a direct-to-consumer model because it helps strengthen brand loyalty and increase consumer confidence in terms of certainty and guaranteed supply of goods and products.

2. Develop alternative supply chains

Developing new supply chains in collaboration with respective governments can ensure faster delivery of key raw materials. Further, to avoid supply chain disruptions arising from factory shutdowns in the future, companies can develop a manufacturing network strategy that leverages government economic development programs that encourage domestic production.

3. Consider supply chain digitalization supported by automation

The coronavirus crisis may be a tipping point in the transition to digital platforms and applications that help establish an interconnected network of supply chain components. In a digital supply chain, every activity is able to interact with one another, allowing for greater connectivity between areas that previously did not exist.

Investment in technologies such as artificial intelligence, machine learning and Internet of Things can help companies gain real-time visibility, better manage inventories, improve logistics tracking and make better-informed decisions. These alternatives to often error-prone ERP systems and manual spreadsheets can help businesses predict disruptions and design actionable mitigation strategies.

4. Adopt robust demand planning practices

Traditional planning tries to match demand with supply for the next 30 days. The problem with this process is that a lot of things can change in a month, or even a week. Today’s fast-moving markets require more forward-looking planning to correctly determine demand for future production and identify potential material and manufacturing capacity shortages. Companies should also invest in strengthening their online presence, and focus on quality assurance and delivery timelines, as more and more customers become reliant on e-commerce channels.

Outlook for the future

The COVID-19 pandemic has had significant effects on international supply chains. Going forward, the crisis is likely to give further impetus to trends already underway. More companies are seeking to leverage their production plants outside China or are planning to build production in new locations. The shift to online shopping will accelerate, putting more pressure on companies to meet expectations in an on-demand economy.

When planning ahead, timely, relevant market intelligence is fundamental to making complex decisions and embedding long-term strategies.

Access to timely, relevant market intelligence, conducting the right analysis and asking the right questions now, will provide the opportunity to build a robust, agile procurement strategy that minimizes risk and safeguards business continuity, without sacrificing profitability.

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Tavleen Kaur and P Vijay are Research Managers at The Smart Cube

brands

Research Shows These 5 COVID-19 Changes Really Can Help Brands Grow Market Share

“We’re all in this together.”  “We’ll get through this and emerge stronger.”

By now, the entire nation is familiar with these COVID-19 era mantras that brands are repeating on the airwaves, social media and in stores. But have consumers had enough of COVID-19 communications? And are these messages really helping brands — not just in the moment, but also with the future in mind?

Because emotions drive consumer behavior, we need to look at how consumers are reacting emotionally to each message to answer these questions. From several major studies with thousands of consumers my firm has conducted, we’ve seen that the brands that connect with consumers emotionally and in particular have a positive impact on how a person feels about themself, are the ones that are most likely to be purchased in general. We’ve also seen that during this period when people’s work and personal lives have been upended and worry, stress, frustration and anxiety are running high, companies that make consumers feel better are the ones that will gain market share and be recommended during and after the COVID-19 pandemic.

Product offerings are one way to make people feel better. Brands are certainly stepping up to the plate by providing products and services that help people feel better by fulfilling a need for indulgence, self-care and control.

Just as importantly, though, is what brands are saying and doing.  Messages of togetherness and reassurance—such as in State Farm’s Ad announcing, “For now, we’re all living a new normal…we’re here to make this new normal feel just a little more normal,”—are indeed helping. So are the actions that back these messages up, such as offering 0% financing, delivery and generous return policies.

Some actions and messages are more effective at making people feel good than others. They’re the ones that will help move the needle as far as retaining and growing market share. In a study of 1,000 consumers, my team and I uncovered the following 5 things brands are saying and doing that increase the chances of purchases and customer loyalty now and in the future by making people feel good:

Saying we will get through this and emerge stronger

A full 70% of those we polled said that since the start of the COVID-19 crisis, they have developed a more positive opinion of brands that remind them “we will get through this and emerge stronger.” Two-thirds (66%) say they will definitely purchase the product when this crisis is over, and 45% say that hearing this makes them feel very good about themselves. Of course, there are different ways to convey this message. Guinness ads acknowledged that St. Patrick’s Day was going to feel a bit different this year, adding, “we’ve learned that over the years, we’re pretty tough when we stick together” and “we’ll march again.” This Coca-Cola ad reminds us that for every loss, there is a gain, that for all the scaremongering there is also care mongering, and for every virus, there is a vaccine–implying humans are ultimately positive and resourceful.

Offering exclusive hours for at-risk groups

It makes good, practical sense that numerous retailers such as Whole Foods, Target, Walmart, Publix and Stop & Shop are offering special hours to those who are most at-risk of contracting the virus such as the elderly because these groups are less likely to leave their homes to make purchases.  But these actions and the messaging behind them are also helping from a short- and long-term marketing perspective.  Four-fifths (80%) of the people we polled said they have developed a more positive opinion of brands that offer exclusive hours for at-risk groups since the COVID-19 crisis began.  Almost three-quarters (73%) say they will definitely purchase from these providers when this crisis is over.

Reminding consumers that we’re all in this together

This is another phrase we are hearing from brands over and over again. In just one example, Hershey’s recent ad Heartwarming at Home begins by saying that we’re in this together and that these experiences give people a chance to come together in meaningful ways. It ends with pictures of people connecting through windows, several feet away, and with family members at home, sending a clear message: you’re not alone.  And it’s working.  Of the people we surveyed, 73% said that since the start of the COVID-19 crisis, they have developed a more positive opinion of brands that remind them “we are all in this together, while 67% say they will definitely purchase the product when this crisis is over. Hearing this makes 42% feel very good about themselves.

Sharing reliable updates about the COVID-19 situation

Apple has released a new screening tool that allows people to determine if they potentially have the virus and if they should seek medical care. They created a new COVID-19 website and app with the CDC to help them understand how to manage the virus, and a Contact Tracing App with Google to help curb the virus’ spread. Quest Diagnostics’s website provides information about COVID-19, and consumers can sign up for email alerts for news and testing information. Although it’s helpful in the moment, being a resource for consumers is also likely to pay off over time: 81% of the respondents said they’ve developed a more positive opinion of brands that share reliable updates about the COVID-19 situation, 49% say that purchasing from such brands makes them feel very good about themselves, and 60% say they will definitely purchase from these brands when this crisis is over.

Reminding consumers to take care of themselves

Surprisingly simple messages such as Uber thanking people for staying home and not using their service, and Sesame Street explaining that “taking care of yourself is also taking care of others” during a campaign that features Elmo and three friends washing their hands to upbeat music are proving extremely effective for brands. A full 77% of those polled said they’ve developed a more positive opinion of brands that remind consumers to take care of themselves, and 57% say they will definitely purchase from these brands when this crisis is over.

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Anne E. Beall, PhD is the CEO and Founder of Beall Research, Inc, a marketing-research consulting firm that uses research to create solutions for Fortune 500 companies. Author of Strategic Market Research: A Guide to Conducting Research that Drives Businesses (3rd Edition) and 7 other books on reading body language, gender dynamics, human-animal relations, and fairy tales, Anne previously worked for the Boston Consulting Group (BCG). She received her MS, MPhil, and PhD from Yale University. A lover storytelling and walking, Anne lives in Chicago.

consumer

As Consumer Habits Change, How Can Businesses Keep Up?

American consumers don’t act and buy the way they did just a few short months ago – at least most of them don’t.

The pandemic and the need for social distancing led to an upsurge in online buying. Takeout and delivery replaced, at least temporarily, dining out. Many consumers, worried about the health risks of spending time in grocery stores, turned to services that would do their shopping for them.

Now, as the country tries to reopen and seek the next normal, businesses across the nation must figure out which of those consumer behaviors will become permanent, which were temporary, and whether any new ones yet unthought of might emerge.

“We live in a time when information can become outdated pretty quickly, and that’s become even more true because of COVID-19,” says Janét Aizenstros (www.janetaizenstros.com), a serial entrepreneur and the chairwoman and CEO of Ahava Digital, a company that ethically sources data on American consumers.

“The businesses that are going to succeed moving forward are those that grasp what consumers want and understand their changing habits.”

In contrast, those businesses that fail to understand what the latest consumer data is telling them, and are slow to adapt to the changes in consumer behavior, are going to be at risk, Aizenstros says.

She says going forward, businesses need to:

-Be prepared to pivot. Business leaders must be flexible. Many restaurants figured that out when the pandemic began, Aizenstros points out. Patrons could no longer dine-in, so the restaurants put an emphasis on takeout and delivery services. In the same way, each business will need to figure out how it can adapt and adjust its services or products to meet what customers want and need, she says.

-Gather reliable consumer data. With the internet, social media and numerous other sources, there is plenty of information available today about consumers, but not all of it is reliable. Make sure data comes from a quality source and that it reflects as much as possible the current thinking and behavior among consumers, Aizenstros says. “Businesses that fail to use reliable data and stay on top of the consumer trends,” she says, “will have a difficult time thriving as we go forward.”

-Take steps to make consumers feel comfortable. Even as people venture out more to dine in restaurants or shop in person, a Gallup survey shows they still plan to exercise caution. Businesses can help themselves by letting consumers know what steps they are taking to keep their stores, restaurants, and offices as safe as possible. “This is just another example of understanding and keeping up with what consumers want,” Aizenstros says.

Businesses have always had their plans and operations disrupted by both technological advancements and changing consumer habits. But rarely does consumer behavior evolve as quickly as it did in the early months of 2020 – and the changes didn’t always happen in easily predictable ways.

“Some areas such as home decor and fashion have done well recently,” Aizenstros says. “At the same time, we are seeing trends with businesses like J.C. Penney, Hertz and others struggling and filing for bankruptcy. It’s hard to keep up with consumer thinking unless your data is consistent, relevant and accurate. But if you understand what your customers want and work to give it to them, your business will have the opportunity to prosper.”

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Janét Aizenstros (www.janetaizenstros.com) is a serial entrepreneur and the chairwoman and CEO of Ahava Digital, which provides businesses and investors with ethically-sourced verified data about American consumers. Her background includes roles in finance at TD Canada Trust, Canon, and Brookfield LePage Johnson Controls, along with management consulting in a broad range of functions, such as supply chain operations, data analysis, and strategic thinking. She has a doctorate in metaphysical sciences with a specialization in conscious business ethics.

company

How Will Your Company Emerge from COVID?

We all learned growing up (hopefully) that our deeds define who we are. Times of crises especially reveal what kind of character people, and companies, have. The coronavirus pandemic is no exception. It’s forcing companies to evolve rapidly regardless of size, industry, or location. As we fear job loss and lament the dislocation from our work, we have to stay focused on improving our workplace cultures, processes, and environments, all of which define our organizations.

The Coronavirus Pause

Over time, leadership that’s bogged down by deadlines and daily quotas can forget the evergreen management principles needed to drive long-term success. The coronavirus offers companies a chance to reset their workflow, reexamine their offerings, let go of dead-end initiatives, and embrace emerging opportunities. The pandemic gives each of us an opportunity to remake ourselves—to disrupt the disruption.

Evaluate Yourself and Your Ideal

First, you must find ways to take stock of your brand impact. If you don’t appear to others as you intend, odds are you’re not the company you want to be. Evaluate who you are and why, then decide who you want to be and assess the action needed to get there.

-Find out who you are in the marketplace. Solicit opinions on your organization and its impact from trusted colleagues, friends, prospects, clients, and even honest competitors.

-Go through your workflow, your processes, your team, your client list, your vendors, your strategic partners—everything that you are currently doing that defines your company. Share and review it with members of all departments. Look at your current mission, revisit your original purpose, and find the direction to match that goal. Define what you need to change.

Next, assess, reassess, and harness all of your information and resources. This may help you find new business lines, action items, or process improvements.

-Amass all your institutional knowledge. Bring your leadership and staff together to codify everything you do. Capturing all the tacit and implicit knowledge of your people will reveal new paths to take and lessen the chance of missed opportunities.

-Have your leadership team focus on the near misses of the past and build a “recent lessons learned” catalog to facilitate self-examination. This will also show you how and where you need to mentor your team, build new working relationships, and improve collaboration.

Third, examine your leadership team through a new lens and rebuild—leaving your dysfunction behind.

I have heard countless times from colleagues (and experienced myself) how destructive it can be to be wholly removed from decision-making, and to have one’s hands tied when trying new things, or even just seeking counsel from outside your department due to trivial power dynamics.

-Share ideas and solicit them. Let people from all levels of your organization contribute freely and synergistically. You will be amazed at how much more engaged all your people are when they know they can contribute in a meaningful way.

-Treat your people well. Mental and emotional health are the wellspring of longevity, loyalty, and creativity. You simply get much better performance out of happy people.

-Break the taboos. Have people from different teams explain their roles to each other. Encourage them to talk to each other about the different functions in your business.

Becoming Who You Want To Be

An example of such a reboot is a small rideshare startup for kids and families. The company—RideAlong—was started by parents in New Jersey who were initially just seeking a safe way to get their kids to and from school.

RideAlong’s CEO Norbert Sygdziak was stunned by how much pent-up demand he discovered: “We started in September 2019 and had double-digit growth and double-digit profits. What started out as a local community need quickly snowballed into real demand across the country. It was incredibly fulfilling. But then came COVID.”

Schools shut down. The business went away entirely. RideAlong’s leadership was at a loss like everyone else. But then it clicked. Sygdziak and members of his Board and leadership team all galvanized around one question: “There are so many people in tougher situations. What can we do to help those people in this time?”

Sygdziak started by taking care of his people and asking his team to pull together. He made sure to take care of his drivers first as they were completely out of work. He paid them to keep the team intact and demonstrate his appreciation of what they were going through. The executives waived and postponed taking paychecks. He gathered volunteer teams of drivers and staff to partner with hospitals, food pantries, restaurants and non-profits to deliver food and supplies to seniors and families in need, provide meals to overtaxed healthcare workers, help children get to hospitals for much-needed regular medical treatments, and coordinate school deliveries for students.

It is not an uncommon pivot at this time, but it is a great example of the power of reexamination. These non-profit relationships and good deeds are leading to for-pay partnerships in ways they never dreamed. Pulling together the entire team, asking “why do we exist?” and “what should we do?” allowed them to reimagine everything.

Importantly, it crystallized what Sygdziak and his team wanted the company to be. They were not just a kids’ transportation company, but rather a mechanism for building community. Sygdziak is moved when he thinks about it: “We were forced to think more deeply about our purpose. By spending our resources on helping those less fortunate, by providing connection, and hopefully alleviating some difficulty, we found inspiration and grew tighter as a team. Now we understand exactly who we want to be.”

Who Will You Become?

Whatever you do with this time, if you have it, embrace it.

Despite the damage done, the coronavirus has inspired companies to pivot to philanthropy. Maybe you have the opportunity to prepare for change and pursue what the ferocious day-to-day never quite allowed. Reach out and expand relationships and geographies. Refine and redirect your team. Fully explore the ideas and solve the problems that always seemed too big to take on.

Rewrite your story and be better.

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Jennifer S. Bankston is the President of Bankston Marketing Solutions and has over twenty years of experience spearheading strategic initiatives for law firms and other industries including technology, financial services, life sciences, and healthcare. Jennifer is also rooted in technology, having developed various applications and products within the organizations she has worked. She can be reached at bankstonmarketingsolutions.com

post-covid-19

The Logistics Industry in a Post-COVID-19 World

The COVID-19 pandemic is slowly passing. However, we still have a long way to go before we can say we are safe from it. Nevertheless, these past few months were difficult, and it is safe to say that some lives were affected in such a way that they will be different forever. The same can be said for many industries that had to – and still have to – struggle with the pandemic in order to stay in business. My guess is that the logistics industry in the post-COVID-19 world will look a bit different than it used to.

Inventory levels

All companies that had low inventory levels suffered major setbacks. Being left without goods and without means of getting new supplies shipped is a disaster for any company.

With that being said, one of the first changes that must be implemented is that inventory levels are always high. Companies will have to factor in any possibility to protect their business if a similar situation arises in the future.

What about the supply chains?

During the pandemic, it was shown that one of the major disadvantages of stretched supply chains is that they can easily break at any point. You never know when the logistics department will fail to deliver, and your entire business is affected by it.

As a solution to this problem, companies will have to invest their resources into shortening the supply chain and making sure that the merchandise is transported from one end to the other in the shortest period of time.

Managing the workforce during high demand

We have witnessed how high demand for a certain product can create holes in the market if there is no possibility of restocking. For a short period of time, it was virtually impossible in some countries to get your hands on a bag of flour or toilet paper. When panic spreads, people often act without thinking.

The logistics industry in a post-COVID-19 world will have to invest in workforce management training during high demand season.

Many smaller companies will disappear

The COVID-19 situation caused many smaller logistics companies to bankrupt. Since only the larger companies that have higher inventory levels and better overall performance survived, they will invest in purchasing bankrupt businesses in order to expand.

This will lead to a change in the market, and competition will be lower as well. Since there will be a smaller number of logistics companies on the market, there is a possibility for a monopoly to develop. When only a few people share a greater concentration of power, they set the rules to favor them. This will result in surviving companies developing a competitive advantage in the global market.

There will be less money for the development department

One of the consequences of the COVID-19 pandemic was the financial loss that many companies suffered. People got fired, and paychecks were substantially reduced in order to keep the business running.

I am not sure if this will affect future salaries, but I can safely say that companies will try to keep more money in the system. The department of development, research, and innovation might not get the same amount of funding as in the past.

This step will help logistics companies to have a solid amount of cash to keep the business running if a similar situation occurs in the future.

How will these changes affect the prices in the logistics industry in post-Covid-19 world?

As I stated above, some of the major changes that will happen in the logistics industry in a post-COVID-19 world are shortening of the supply chain, securing higher inventory levels, and investing in workforce management to deal with challenging situations. Furthermore, larger companies may hold a monopoly on the market.

All of these steps require a lot of money. For that to happen, the prices will have to go up. It is unclear about the percentage, but it will happen.

What can you do as an owner of a small logistics company?

Owners of small logistics companies will have to find a way to keep up with this situation or perish from the market. If you are among them, here is a little advice on how to prevent this from happening to your business.

Make partnerships

This might be a decisive move, but making a partnership with other companies in the same situation can increase your overall strength on the market.

Try moving your business elsewhere

Looking for a fresh market without large competition might be a smart move. Many companies may decide to move to a smaller area, or even to a different country, in order to increase their business. A company might make the transition less painful.

Big changes are coming!

As we can see, big changes are coming in the logistics industry in the post-COVID-19 world. As always, when an economic crisis occurs, only the stronger ones will swim out on the surface. Nevertheless, that does not mean that others will lose their plays on the market. Informing yourself in advance will help you prepare for the upcoming changes, and maybe even save your business! With that in mind, spend your time on research that will help you keep your business running. Stay safe and good luck!

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John Palmer is an economic expert with over two decades of experience. Working as a freelance blogger, John uses the opportunity to reach out to a wide group of people and educate them on how to manage their business in a challenging situation. However, he does branch out into other areas, as he also writes for moving companies such as Easy Move KW. Some of his other interests include business startups, management, and business continuity.

disruption

Navigating Through the Disruption – An Oceania Perspective

Logistics has always been the backbone that silently keeps the world moving but, in this time of uncertainty, its importance has been magnified. COVID-19 has caused disruption globally to all business, in one way or another, and navigating this unprecedented time has highlighted many challenges.

With the evolving landscape, forward planning has become essential to ensure business continuity plans are effective. The need for a recommencement plan for businesses who have temporarily closed and a diversified supply chain for those who operate as essential services is paramount to ensuring business survival for now and success in the future.

What we learned from New Zealand’s Lockdown

The level-4 lockdown of New Zealand has shed some light on the potential challenges that may arise should Australia follow suit.

The Port of Tauranga has announced it is prioritizing the unpacking of essential goods so that the cargo can be handled and transported first. Container loads are able to be delivered to customer’s sites, if the site is accepting deliveries, however, they cannot be unpacked until the level-4 lockdown period has finished. By doing this, the Port and Government are ensuring the movement of essential goods remains efficient and that essential services can continue operations as usual.

Where a customer site is closed, we see the Port of Wellington waive storage fees for shipments that cannot be transported out of the Port.

We are working with our clients to identify if their goods would be considered essential in the event of a complete lockdown. We’d advise that all companies start considering what sort of goods they have incoming and work with their strategic partner to qualify if their goods would be restricted to such delays if a lockdown were in place in Australia.

Be realistic and confirm whether your goods are considered an essential service and put suitable business measures in place.

If you find that your business cannot be considered essential or it is not viable for you to remain open, you’ll need to prepare to get back to production quickly once the lockdown is lifted. We recommend that non-essential businesses put a plan in place for the commencement of reopening. It is important to consider whether the recommencement of operations would be staggered, what goods or orders are required to meet the operation recommencement timeline, and are these urgent.

Diversify your Supply Chain

Sometimes the best solution for a business’s supply chain issue is to consider diversifying your shipment options.

For example, it may be beneficial to combine different transport types by flying goods to Singapore before shipping them to Australia rather than just shipping from their location of origin. Combining the two transport types is a faster and cheaper option than purely using air freight in a volatile market.

Businesses may consider using Less than Container Loads (LCL) if they require certain goods for essential service production because it is more cost-effective than their standard full product shipment in a Full Container Load (FCL).

An alternative to air freight, road, and rail in Australia is the Domestic Coastal Shipping Service. After ships have unloaded goods in Eastern Australia, on their return journey to their location of origin, they are able to pick up and deliver domestic goods as they travel West along the coast. We have seen more than a 20% increase for the quarter year-on-year due to the additional pressure on the Australian road and rail market. Rail is at capacity with customers experiencing damage to goods, severe space, and equipment issues as a result whilst the state border closures are posing potential delays for trucking. Many major clients, especially in the food and beverage sector, are switching large volumes to our coastal service as a solution to ensure continuity of business supply.

This domestic shipping service provides a saving of up to 60% over rail and road services. Businesses would need to take into consideration the increased travel time required over other domestic modes of transport and plan this into their supply chain model.

When new challenges arise, it is best for businesses to discuss their options with their strategic partner, who will help navigate this uncertain time.

As businesses struggle to meet the demands of this new normal, C.H. Robinson’s trusted advisors around the globe are continually looking for the best solutions to keep your supply chain moving.

human

A Human Perspective – Global Business in the Post COVID-19 World and The New Norm

There is little doubt that our economy will not be the same in the post novel coronavirus world. American businesses long have shown the scars of national trauma: Devastating fires, for example, spawned major factory regulations. World War II hastened the entrance of women into the workforce. September 11th drastically heightened security protocols. Analysts say the novel coronavirus pandemic could push broad societal shifts and human behavior. There will essentially be a “new norm” where new businesses will start, others will thrive, and many will disappear. As human beings in this New Era, this article will identify how the human perspective will influence business and consumer trends.

One of the most apparent human factors consumer impacts from the coronavirus outbreak is a shortage of toilet paper stemming from panic buying originating from video’s that went viral such as this one from Australia.

However, upon a human perspective evaluation, there is a supply chain shortage of toilet paper, not an inventory shortage. Consumers are now buying for their homes as the toilet paper supply in offices, restaurants, airports, hotels, and schools go unused.

Other observed human factor trends are a shortage of Viagra where Pfizer is allegedly at full production capacity of Sildenafil at its Amboise France Facility (Now managed by Fereva). Lastly, figuratively related, in Food Science, packets of yeast are also at shortage levels as homebound bakers now have more time on their hands to take the time required to bake fresh bread.

Lastly, the best performing commodity during this epidemic has been frozen concentrated orange juice rising over 20% (Akin to the 1983 film Trading Places)

The most significant impact economists say will likely be dramatic losses in local retail and dining options, with millions of jobs disappearing as the most prominent and wealthiest companies — especially those that do much of their business online — extend their gains. Giants such as Amazon, Walmart, Target, and Costco — and the rest of the industry. Companies selling groceries and staples are thriving, while the rest are barely hanging on.

Telework, online education, and streaming video services have grown sharply, while movie theaters, schools, and traditional workplaces close their doors. Some will never reopen in a world where the shift from real to virtual suddenly has gone into overdrive. In the entertainment industry, Universal Pictures announced this week that its animated adventure “Trolls World Tour,” due for release in April, instead will be available for streaming. Such shifts, if they take hold long term, could imperil movie theaters, especially small and independent ones that run on narrow margins based heavily on concession revenue.

Virtually any business practices, such as remote work and the online medical visits or telehealth, which were slow to win widespread adoption because of behavioral inertia, will now speed adoption of such unfamiliar ways of doing business. Any traditional face-to-face encounter — going to an accountant’s office, sending children to class, traveling for a business meeting — will seem less necessary as more remote options become publicly acceptable and widespread.

An economic silver lining will emerge for janitors, child-care workers, grocery store clerks, and servers who will be able to demand higher pay and better working conditions in the post-coronavirus world, some analysts predict. Many have called these workers “heroes” in the crisis.

It’s impossible to say what ripple effects these massive disruptions could cause. One analyst pointed to groceries: When few people opted for home delivery, the scale of the enterprise ensured the costs were high, and availability was low. But as crowds of people opt for delivery, the route drivers will grow denser, and customers will expect everything is dropped off at home. Deliveries of items that were generally in-store purchases — fresh foods, prescription drugs — could usher in new economies of scale.

Businesses dependent on prime real estate and bringing people together could be especially vulnerable as people opt against public gatherings, including shopping at malls. That could have other impacts, too: One analyst said he suspected conspicuous consumption — high fashion, expensive sneakers, sparkling jewelry — might suffer when people “don’t have anywhere to parade.”

Other firms may become winners, too. Blue Apron, the food-delivery service, struggled for months to convince investors that people would pay $60 a box for all of the ingredients they need to make home-cooked meals. But the firm saw its stock price skyrocket more than 500 percent last week amid a flurry of new interest. The company said it is hiring workers at its fulfillment centers in California and New Jersey to meet demand.

But as surgical masks become desperately desired items, schools from Japan to Ireland sit closed, airlines scrap flights, trade shows are canceled, and stock markets plunge, the pandemic seems likely to alter the contours of globalization and human behavior. However, one thing we all can agree is human beings will prevail over the virus. As the Great Winston Churchill said: If you are going through hell, keep going.”

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Frank Orlowski is an accomplished Senior Finance Executive and Board Member with more than 25 years of success in the pharmaceutical, medical devices, contract manufacturing, and healthcare industries. Leveraging extensive experience leading manufacturing, operational, and financial strategies across 35 countries.  Frank has also implemented over 30 FCPA Compliance/ Controls Remediation and Certification Programs across 25 countries.

Contact:

Email: frank@ationadvisory.com

Website: www.ationadvisory.com

transformation

How A Transformation Mindset Positions Companies To Succeed After The Crisis

Many businesses are reeling from the COVID-19 pandemic, and while some may return to business as usual once the crisis is over, others may need to alter the way they think and operate in order to survive.

Many global leaders think the pandemic will transform the world in significant ways, and companies with leaders who already have a transformation mindset will be better equipped to adapt and succeed at a high level, says Edwin Bosso, founder and CEO of Myrtle Consulting Group (www.myrtlegroup.com) and ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey.

Bosso notes there are two types of companies who entered the crisis. “The first type are those who went through a level of transformation prior to the crisis and had the plans and structure in place to keep moving. For them, it will be a lot easier to see where the gaps exist and also where the opportunities are for growth,” Bosso says. “They’ll have better tools to react and analyze what happened and make decisions on what to change.

“The second type of companies are those who, before the pandemic, were contemplating changes that were necessary, but they didn’t follow through. Those companies will come out of this wounded and feeling the environment is more chaotic. Transformation management in this environment is vital. It’s about creating momentum to see results and growth, and the process must be geared at successfully moving hearts and minds toward the end that we seek.”

Bosso suggests three phases – prepare, initiate and implement – for managing transformation in these challenging times:

Prepare

Understand your soul as a company. “Understanding an organization’s soul becomes important because it is the only true representation of the impact that the organization has on the world,” Bosso says. “Knowing the company’s true north puts it in a position to build a higher purpose into the transformation program, and ensures the transformation is rooted in the essence that will make the company successful going forward. It really comes down to answering one question: ‘When people think about our company, whether we are still in business or whether we are gone, what will we want them to say?’ The answer to that legacy question should be a set of descriptors of your identity and capabilities.”

Conduct a post-crisis assessment. “Companies should take this opportunity to examine what they were dealing with before the crisis, how they handled the crisis, and to create plans for how to emerge stronger than before,” Bosso says.  “This event gives leaders carte blanche, in many respects, to implement bigger plans and changes than before. At the end of this, there will be opportunity for those who seize it.”

Initiate

Program the team structure. Bosso organizes a transformation team into these departments: program managers, the leaders of the workstreams, the team members for the workstreams, and administrative support. “This team will be in charge of the implementation phase and be accountable to the company leadership team,” Bosso says. “Communication must constitute a key part of every transformation program and must be organized to reach various audiences at different stages of the program.”

Implement

Manage results: “The implementation phase is the riskiest,” Bosso says, “because it includes the organization’s transition through the emotional cycle of change. Programs must deliver the intended results, and along the way, failure will happen. Measuring short-term and long-term results allows the opportunity to deliver on a specific goal and to celebrate specific successes. However small they are, they add stamina and motivation to the effort.”

Manage people: “A significant challenge that organizations often face when it comes to implementation is people’s resistance to change,” Bosso says. “Implementation is much about building people and building performance. It involves teaching, convincing, coaching, rewarding, sometimes disciplining, but always expressing to people that they are at the center of the organization’s destiny.”

“All companies that come through this pandemic have a huge opportunity to learn from what they’ve done and from what they haven’t done,” Bosso says. “For many, it will be a time for transformation.”

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Edwin Bosso (www.myrtlegroup.com), ForbesBooks author of 6,000 Dreams: The Leader’s Guide To A Successful Business Transformation Journey, is the founder/CEO of Myrtle Consulting Group. Bosso specializes in operations improvement and change management, and his project history includes work for major brands such as Heineken, Texas Petrochemicals, T-Mobile, Anheuser-Busch, Rohm and Haas, Campbells Soup, Kellogg’s and Morton Salt. A wide range of assignments has taken him to Asia, Europe, and North America. He completed his undergraduate education at The Hague Polytechnic in the Netherlands and earned an MBA from Rice University in Houston. 

uncertainty

Your Enemy is not Uncertainty, but Complexity

As a nation, we look to the economy to answer our basic questions about the future. What will fluctuations in global markets and supply chains bring? How will the dollar recover from the circumstance of a stalling consumer market? And what impacts, if any, will change the way we do business? As spring approaches, the anticipation around these questions builds. We watch for signs of our shuttered economy lurching back into motion.

Businesses, much like individuals, have coping mechanisms when faced with a crisis. There are ways to build a business contingency plan, even with unforeseen challenges. Some industries have not dusted off their plans since the financial crisis of 2008, and there is anxiety around what it means to enact it. But the truth is: business contingency plans are built precisely for moments like the spread of COVID-19. And while words like “unprecedented,” “alarm,” and “volatility” rule headlines, reactivity is not how businesses run. It is through preparedness and foresight. It is with a business contingency plan.

While no leader takes comfort from enacting their company’s plan, the ability to swiftly empower crucial business functions with ease is possible. Uncompromising company and financial data security and work-from-home procedures are not mutually exclusive. A bit of knowledge is required to migrate an office environment to the home without opening new vulnerabilities.

Divide and Conquer

Dividing and conquering is the oldest trick in the book for any opportunist looking to damage their business. Security hackers and other ill-intentioned opportunists look for times of organizational chaos to strike. They trust that business leaders have overly-divided their attention and that employees will not adhere to traditional protocols for data security or safe treatment of sensitive information.

There are also a substantial number of leaders who will focus on the uncertainties of the future, preventing them from seeing vulnerabilities that are right in front of them. This, of all things, means that many companies and their leaders must know the enemy is not the distractionary dips and dives of the economy, but the complexity of an organization that prevents it from responding elegantly to uncertainty. Military strategist Sun Tzu of The War of Art provides insight into how we should prepare for battles with the unknown:

“Know the enemy and know yourself; in a hundred battles, you will never be in peril. When you are ignorant of the enemy, but know yourself, your chances of winning or losing are equal. If ignorant both of your enemy and yourself, you are certain in every battle to be in peril.”

Having a business contingency plan is only the beginning. Redraw your battle lines when uncertainty strikes, and you will unmask the hidden areas that need better solutions.

Strategies for reducing business complexity:

Strategy #1: Define ‘new normal’ from the top down, but bring insight from the bottom up

Your employees will not naturally intuit where the new boundary lines exist. Spell it out so that everyone is on the same page. Barring in-person meetings, you may need to host a company-wide Zoom call with a panel of C-Suite leadership to reassure, set new expectations, and answer questions.

Most importantly, leadership should use this as a chance to gather further information. Seek out the experiences of those who serve your customers directly to get their perspective. How are customers responding to the shift? What are their emerging needs, and is there a niche there that your industry can uniquely fill? Keep your company’s ears to the ground.

Strategy #2: Banish organizational drag through automation.

In environments of economic hardship, businesses with leaner operations and less organizational drag do better. Cutting out redundant manual processes is crucial to eliminating complexity. A business contingency plan will help enact the first line of defense for your business. However, this is not all you will need. The second wave of reinforcements is crucial to keep your business advancing through times of uncertainty.

Automation is your greatest ally in this fight. Now is the time to abandon stale processes. If they’re manual or paper-based, requiring cartons of messy file work or repetitive wet-ink signatures, its time to rethink. Lean heavily on electronic AP solutions, which can clear up the bottlenecks choking out crucial supply chain relationships.

Never in history has the value of a swift and reliable supply chain been more evident than now, as hospitals face shortages of both personal protective equipment and crucial medicines. Industries are re-learning a valuable lesson: that while necessity is the mother of invention, the cost of waiting to innovate can be incredibly painful.

Strategy #3: Reach for a sturdy bottom line more than blue-sky profits

This year is unlikely to offer many sunny prospects in the realm of profits. Yet cost-cutting initiatives will provide the kind of stability a company needs to make impressive cumulative gains in the coming years. What does this mean? Playing defense isn’t your only strategy. You can also cut costs to preserve the liquidity you do have.

With electronic tools already up and running for staff communication or remote meetings, it’s time to ask yourself how you might unburden other areas of the office from slow performance inefficiencies. What is sending through the mail that could be automated? How might making payments to suppliers electronically cut back on paper check costs? Explore every avenue for cost savings. There are many electronic solutions at the ready to lift manual-based work with minimal if not zero downtime for your business. Now is the time to employ these solutions and not hold back when better-designed options exist.

Strategy #4: Invest in secure solutions without needing to hire more IT

Everyone at this point could do with one more great IT hire, but the point of a business contingency plan is to be resourceful with what resources do exist. Making quantum leaps from the office to a remote setting is much easier for companies who have already made steps toward digital transformation.

Instead of losing more time to processes like answering phones, getting approvers to hand-sign checks, and sending paper mail to closed-up company headquarters, make them digital, with greater control and traceability. Fraudsters’ potential access to your systems diminishes when you have greater visibility and fewer cooks in the kitchen. Higher thresholds for security mean that problems or threats are identified in real-time and careless or lagging processes fall by the wayside.

Strategy #5: Innovate, innovate, innovate

It’s tempting to lose steam during a crisis and consider it the wrong time to try creative solutions, but the logic doesn’t stand. Now is absolutely the time to try new things.

Since volatility has introduced new stressors into the equation for your business, the target has shifted. A brand new segment of the market may have just locked into place in the form of potential customers. You have the potential to attract them by showing that you understand their needs quicker than anyone else in the space. This requires agility and a bit of risk, but it’s a risk worth taking, even under present circumstances. Innovation isn’t an optional advantage in times of plenty. Innovation is essential to the survival of every business.

In the words of Sun Tzu, “In the midst of chaos, there is also opportunity.” Do not take advantage of the chaos, but respond with resilience to its demands.

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Lauren Ruef is a research analyst for Nvoicepay, a FLEETCOR company, with years of experience conducting market research and crafting digital content for technology companies.  Nvoicepay optimizes each payment made, streamlines payment processes and generates new sources of revenue, enabling customers to pay 100 percent of their invoices electronically, while realizing the financial benefits of payment optimization.