The supply chain has had more than its fair share of challenges over the Past 18 months, but Lynn Torrel, chief procurement and supply chain officer at Flex, says there is still much to be optimistic about
For supply chain professionals, it has been a challenging 18 months. A myriad of issues has plagued the global supply chain, including obvious obstacles like the pandemic, chip shortages, and extreme weather, as well as not-so-obvious issues, such as shipping container shortages. Global supply chain teams have worked tirelessly to ensure material is available so products can be built, shipped, and available to purchase with minimal disruptions to the consumer.
Supply chain professionals have the unenviable task of making this happen while managing a highly fluid global environment that evolves daily. It’s been challenging to say the least, but global supply chains will emerge revitalised, optimised, and more resilient in the long term. It might be difficult to think this is possible as the industry struggles to “survive the day,” but there are transformative changes happening behind the daily chaos that will shape the world of business for decades to come.
The past 18 months have demonstrated the critical value of supply chain management strategies to global businesses. Over the past decade, the industry leaned out the supply chain to improve working capital velocity but, in doing so, made it so brittle that minor disruptions caused shockwaves. A giant boulder was dropped on everything in 2020, and it was so impactful that it forced supply chain professionals to re-evaluate many strategies that they had built and implemented.
But it is not just supply chain professionals going through a re-evaluation process. Executive teams and boards of directors are doing the same thing and understanding the critical role supply chains play in the success of a business. Fortunately, as a diversified manufacturer, Flex has always understood the critical role the supply chain plays in both our and our clients’ success.
These past 18 months have also shown our clients that supply chain operations are a competitive differentiator. Supply chain professionals now have a seat at the table from the very start because it is understood that how materials are sourced and supplied are just as critical as how the end products are manufactured and delivered.
We’ve spent the last decade learning how to manage global supply chains, primarily with Asia as a central hub. Beginning last year, many industry leaders predicted that the volatility of worldwide supply chains would lead many businesses to implement regionalisation initiatives.
The logic was that companies want to build products closer to their customers to reduce freight and logistics risk. Our team has seen this already begin to happen with a few clients in a couple of markets. We expect to have conversations with many more clients in the months and years to come as they look for ways to minimise risk and speed up production.
It’s not an easy decision for most businesses. Supply chain professionals can’t simply snap their fingers and relocate their entire manufacturing, assembly, and freight operations to another region. A significant amount of time and money must be invested to analyse if a regionalised supply chain would deliver value over time.
There are also many additional variables, including constraints on cost and labour availability and the organisation’s ability to manage the complexity of the transition and ramp up without disturbing overall production. In the end, a return to a decentralised regional supply chain could remove layers of complexity and improve time-to-market, but there will also be cost increases.
What a time to enter the workforce for the graduation classes of 2020 and 2021! As entry-level supply chain professionals take their first jobs, these historically adverse times will provide a substantial test of their aptitude and stamina. At Flex, we’re seeing our team rise to the challenge for our clients and flatten their learning curves to keep up. We’re living through an event whose impact will reverberate for generations, and these recent graduates are in the trenches with experienced leaders to develop creative solutions for supply chain challenges.
A big reason why these entry-level professionals ramp up so quickly is because of
businesses’ ability to offer remote onboarding and training. Rather than traveling to a manufacturing site, see the manufacturing processes, and gain a thorough understanding of the supply chain’s role, trainees now dive into online training courses from the comforts of their home office.
Similarly, remote work enables supply chain leaders to provide advanced learning sessions to highlight current difficulties their teams are working through or other lessons with real-world applications. All hands are on deck, so it’s a great time to enter the field.
I’ll admit that one of the things that concerned me early last year was how my job would translate to a remote environment. I had just joined Flex, regularly travelled to our major facilities and held in-person town halls to familiarise myself with our global workforce. That all stopped when international travel was eliminated to help reduce risks.
While facetime and touring facilities are critical components of my job, the ease and efficiency of video meetings and remote work have opened my eyes. In many ways, relationships with my colleagues, suppliers, and customers strengthened while working from home. Rather than meeting once a quarter for an in-person meeting, supply chain professionals meet with their peers multiple times a week to help and support one another.
This last part is especially vital as we navigate through this global crisis. Supply chain professionals leveraged video meetings to aggregate and manage significant issues quickly. As we’ve seen, each country has had its unique challenges containing Covid-19 outbreaks and managing its vaccine rollout. These changes had immediate impacts on the supply chain and required frequent collaboration between cross-continental teams. Working so closely together creates a more collaborative and transparent working environment that is critical to success.
This global supply chain stress test is identifying weaknesses in our systems that likely wouldn’t have emerged otherwise. Intelligent supply chain professionals are staying positive and using these challenges as an opportunity to find new solutions to emerge wiser and more robust than they ever thought possible.
Supply chain professionals would be wise to heed Winston Churchill’s advice, “If you’re going through hell, just keep going.” It can be difficult to see the light at the end of the tunnel during a tumultuous time, but if you step back and look at the past 18 months you can see Organisations have implemented new technologies and policies that will power their businesses for years to come.
Find out more about Flex’s supply chain expertise at flex.com/supply-chain
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