The true business impact of the COVID-19 crisis will be best measured by the response of industries to learn lessons and rebound as strongly and quickly as possible. What is certain, is that future business strategies must hold supply chains at their core.
In order to learn a little bit more about what the future has in store for the supply chain in a post-pandemic world, I had the privilege of being able to attend the Supply Chain Europe Virtual 2020 hosted by Reuters Events on 17th and 18th September.
The discussions centred around 4 key pillars for supply chain and business success: Sustainability, Digital Excellence, Risk Mitigation & Customer Centricity, and I would like to break down my 3 key takeaways from the event.
Sustainable Logistics
Sustainability is a key part of the supply chain and it is incredibly important for supply chains to achieve sustainability. Especially with the increased amount of ecommerce sales seen throughout the pandemic, it is now more important than ever that more companies implement sustainable logistics. For this reason, I found the keynote speech “Putting logistics at the heart of sustainable cities” by Trevor Hoyle, SVP Ground Operation FedEx Express really useful.
The big question here is: how can the supply chain and logistics sector ensure that everyone gets the goods and services delivered as and when they need them but also protect the environment? Electrification and soft delivery methods such as bikes and drones dominate the discussion around sustainability. However, while technology such as drones are not yet widely available; it remains important to draw upon the greener modes of transport and the human power in order to ensure that logistics becomes more sustainable.
Yet, this will be a process that takes time. This is because although regulation in terms of promoting electrification has become more popular across cities in Europe, the issue cannot be oversimplified. This is because current charging infrastructure is not capable of supporting a full move to electric vehicles and many logistics depos are too far away to provide essential charging stations.
Digital Excellence
The pandemic has sped up the rate in which businesses have adopted technology into their supply chains. It may soon be a case that businesses need to get digital or may get left behind. However, it is not just enough to have the technology, it needs to be the right type of technology for your business’ needs in order to achieve digital excellence. For this reason, I found the keynote speech from Dr Jag Srai, Head of the Centre for International Manufacturing, University of Cambridge on “Next Generation Supply Chains: Making the right decisions about digitisation” really insightful.
There’s so many different types of technology which a business can adopt from AI and ML to digital twinning or even IoT. Yet, even with all the best digital supply chain technology in the world, it will work in its optimal capacity unless so-called digital attitudes are nurtured within your company. Dr Srai breaks down this into three main categories: understanding opportunities and challenges of digital adoption; managing knowledge and skills gaps and leadership.
Understanding the opportunities and challenges of digital adoption involves making sure that employees within your company acknowledge the importance of experimentation with new technology but also that they understand the dangers which are associated with “pilot” purgatory i.e. being stuck in the testing phase of new technology, unable to achieve progress towards measurable results or progress towards scalable deployments. Whereas, managing knowledge and skills gaps involves helping employees within your business get to grips with technology and this can include dealing with ambiguity or uncertainty they have but also building resilience within individuals. All of which may call for a new style of leadership, for example reverse mentoring in situations where subordinates are more knowledgeable than more senior colleagues.
Risk Mitigation when doing business in China
The COVID-19 pandemic has probably been the biggest risk, which supply chains couldn’t prepare for and for that reason it threw supply chains into chaos at the beginning of the pandemic. However, supply chains face risks every day, which is why risk mitigation is a really important aspect for supply chain professionals. Throughout the two-day event risk mitigation was talked about a lot, but a session I found really insightful was a session by Johannes Nanninga, CEO, Guangzhou Port (Europe) BV titled “China business flows: Developments and trends and how is the COVID-19 pandemic impacting the supply chain”.
China has been a key talking point for a lot of significant supply chain professionals as many supply chains are linked to China and as a result faced disruption when China locked down at the beginning of the year. However, while some may say they are risks associated with China due to the virus and the ongoing US-China trade war, the Chinese economy remains one of the largest in the world and vitally important for supply chains. For this reason, it’s important – as part of a way to minimise the risk of being in China – to understand the trends and movements in China, as this will aid your decision to decide whether you want to enter or remain in China.
For example, China is currently undergoing overall business reforms including simplified business registration and improved IP protection. These moves may lead to companies feeling like it is less risky being in China.
Final Comments
I hope this has given you an oversight into some of the topics discussed at this year’s Supply Chain Europe. The recovery from the coronavirus pandemic is probably going to be difficult in the short term but will lead to long term improvements.
I would like to say a special thank you to Reuters Events for organizing the event and to all of the speakers and panellists. I left the conference feeling very positive and inspired.
