Other Voices: Planning and technology can reduce disaster risk
Every natural disaster teaches supply chain managers and their organizations new lessons.
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Editor’s Note: The following column by Joe Puleo, chief customer officer, DHL Supply Chain, is part of Modern’s Other Voices column. The series features ideas, opinions and insights from end-users, analysts, systems integrators and OEMs. Click here to learn about submitting a column for consideration.
In addition to disrupting—and in some cases devastating—the lives of millions in North Carolina and South Carolina, Hurricane Florence will have an impact on the region for many months, and possibly years, to come.
In recent years, drone footage of natural disasters such as this brings the true picture of the damage to our digital devices, sometimes in dramatic fashion. This New York Times video, posted on September 20, shows the widespread devastation and estimates that more than 8 trillion gallons of water fell on North Carolina alone.
Every natural disaster faced by supply chain managers and their organizations teaches us new lessons. The fact that this storm laid so much inland territory to waste supports scientific research published in the Journal of Climate which states that since 1949 hurricanes have become wetter – carrying more rain – and slower, spending more time over a particular area.
Both are factors that negatively impact manufacturing and logistics. These considerations – suggesting that things will be worse for a longer period of time than ever before – must be added to the list of concerns we face in managing supply chain risk. Given that the hurricane season has more than two months to go (it officially ends on November 30), here is a brief primer of planning measures to be considered:
Pre-position essential materials and stocks. New forecasting technology means that hurricanes and other storms can be forecast well in advance with better accuracy than ever. This gives companies more time to plan – and by monitoring forecasts in real-time, efforts to minimize disruption can be initiated quickly.
Have a business continuity plan for at-risk locations. It’s essential to have such a plan to increase the speed of disaster response. Critical aspects like potential alternative suppliers, different routes to and from crucial locations, key points of contact and additional short-term transportation factors should be included. A word of warning, however – make sure the plan is functional by running an all-hands-on-deck tabletop test to identify gaps and weaknesses.
Use mapping tools for supply chain risk assessments. These provide greater transparency and help companies understand supply chain interdependencies and should identify at-risk locations and prioritize mitigation efforts down to sub-tied supplier levels.
Diversify locations. Alternative suppliers, production and warehousing facilities outside of high-risk areas can ensure continued production and order fulfillment in case of a disruption. Alternative transportation routes from unaffected supplier and warehouses should be established in advance.
Establish long-term logistic supplier partnerships. These can provide a lifeline when disaster looms. Trusted logistic partners can book capacity on charter flights to move shipments from disaster areas at a time when everyone is seeking space.
New technologies reduce risk
“There’s an app for that.” You’ve heard that phrase many times, most likely.
But when it comes to managing supply chain risk on a global basis, it’s true – and that’s good news for us all. Logistics partners are teaming with technology experts worldwide to develop and offer digital apps that use big data, predictive analytics and machine learning algorithms to identify and manage risks are available and in development for use around the globe. Real-time risk management can deliver predictive information to supply businesses with access anytime, anywhere to predict, assess and mitigate disruptions in real-time.
Such incident monitoring tools can provide global visibility to events that include natural disasters, security threats and emerging regulatory issues. Having such intelligence well ahead of time can allow organizations to quickly and accurately predict, assess and mitigate the risks of supply chain disruption.
Supply chain interruptions – natural or man-made – will continue to impact us all. There’s no avoiding that. But anticipation and preparation can make all the difference for any organization.
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