There are probably a few ways to interpret that headline depending on your business. One is, “We just spent all this time and money perfecting our global supply chain, please tell me it was worth it.” Another is, “Good, we have been waiting for the right reasons to unbundle what has become heavy, complex and too big for our purposes.” Or a third way now that Covid-19 is restricting worker movements – “We are concerned with ensuring the safety of our supply chain because items in it pass through so many hands in multiple geographies…we have to make changes if we want to remain in business.”
No matter which answer or tertiary one applies to your business, the reality is that government policies specific to social distancing – not just from each other, but from physical assets, is a must for the time being. Even after businesses and regions flatten the curve, others may still be struggling with Covid-19. Once this scourge has passed, restoring confidence among any and all constituents is key.
In a previous post, we discussed increased scanning to help improve chain of custody and pedigree without touching physical assets. Certainly, automated scanning is one way to remove some human interaction, but it alone might not lower the odds of contamination enough.
At a minimum, the current environment is forcing those in supply chains to rethink how parts are sourced, most certainly where products are built, and the subsequent distribution channels. Thematically, supply chain managers are looking to find more ways to reduce human exposure to prevent infectious diseases from continuing to spread. One of the most common answers bubbling up of late, is to simply bring manufacturing and distribution onshore.
Going a step further as pertains to domestic production, one of the clear ways to lower contamination would be to have simpler, unified, contained, and domestic-only supply chains. Doing so in many cases requires less shipping, handling, sourcing, scanning and tracking, and thereby lowers the odds of a problem arising. Many supply chains currently rely on powerhouses like China, Korea, Japan, and newer entrants in the production side of the market like Vietnam as the source of manufactured goods, electronics, RFID tags, IoT sensors and the like.
However, in a Covid-19 world, just because something can be produced quickly, cheaply and reliably does not mean it is safer. While safety is and was always a concern, it is now the likely driver in how a business re-establishes or creates an onshore solution that is safety-driven first. It is clear that safety is now one of the most important considerations in developing what are ultimately efficient and safer supply chains.
At the end of the day, companies with global supply chains want to sell and move more product. Covid-19 is so dramatically altering that ability that unbundling complex networks could prove the simplest way to ensure a safer experience and longevity for the businesses themselves.