Abstract
Supply chain reach is vast and touches every aspect of business. As profitability of any business is directly impacted by its inventory, so any basic changes in operations would impact its performance. However, established supply chain paradigms are no longer valid as they are shaken up by VUCA economy, demographic change, sustainability, globalization, digitization, rise of ecommerce, political turmoil, social media, buying behaviour, and most importantly, by COVID-19. This COVID-19 pandemic crisis has taken over the world and brought additional challenges at an unprecedented scale. Since identifying and structuring the problem are the first steps towards effective SCM, so redesigning the distribution strategy is the need of the hour. Companies should innovate with data and new digital technologies to increase automation in their core process to forecast predictive analysis for greater customer experience and harness the disruption. In the context of disruption, this study explored how to utilize and optimize supply chain tools and models to make decisions during times of disruption.
TopIntroduction
The rapid spread of the COVID 19 pandemic has created uncertainty and disrupted the global supply chain (WHO 2020). That was a big challenge for organizations that are responsible for the safety and security of supply chain. This Covid19 pandemic has caused many countries to experience a significant economic slowdown. It was the fastest-growing global recession since 1990.The global economy has been affected by this pandemic and several countries have experienced economic recessions. The global economy has been experiencing recession since QI and II 2020. Several countries have started experiencing negative growth. Distribution and warehouse operations were severely affected by the lack of space and physical distance The lock-up restrictions imposed on the SC have also put a strain on the supply chain in India (Chaudhry, 2020). Many companies in India had suspended or significantly reduced operations due to the financial situation. The impact of the decline in funding were also affected the start-up ecosystem (Singh, 2020).Almost all the major companies, including Dabur India, ITC, and Hindustan Unilever, had temporarily stopped producing due to the government's order to shut down factories(Mudgill, 2020).In response to the government's order to implement a 21-day lockdown, both Hon Hai Precision Industry and Foxconn suspended production too (Wu, 2020).During the lock-down, inter-state logistics had been banned (Parth, 2020) only the movement of essential goods were permitted. Milk and certain SCs were also allowed to function (Krishnan, 2020). Because of COVID 19, there was also an inability to move materials (finished goods and raw materials). It reduced incoming cash flows and caused workers at all skill levels to migrate, which had negative implications for businesses. Therefore, all SCs were disrupted due to the blockage of people and materials as a result, there was a need to change existing structures and relationships within the SC to address the change in business models and use of innovative technologies.
Due to the pandemic, a supplier could not supply the product and the workforce could not work due to government regulations. Also, because of the closure of certain seaports and airports, outbound and inbound logistics were also severely affected. As a result, Cash flow was also affected by these problems in supply chin industries. Due to the various factors that affected the operation, it was difficult to predict how long it would take for the company to recover. The supply chain strategy of a company dealing with a pandemic needs to be able to predict both the demand and supply of a given product. Hence, the Covid 19 pandemic requires a supply chain that is capable of mapping both the demand and supply. This strategy must be implemented in order to minimize costs and increase the number of orders.
Key Terms in this Chapter
Supply Chain Performance Measurement: It is defined as a method for measuring the effectiveness of a supply chain system.
RFID (Radio-Frequency Identification): This identifies and tracks objects with electromagnetic fields.
Inventory Control: It is the process of ensuring that an organization has a sufficient amount of stock available.
Supply Chain Management: Supply chain management involves the movement and storage of raw materials, the processing of raw materials, and the fulfilment of orders.
Supplier Chain Resilience: This concept entails so much more than just managing risks. Managing risk now means being better prepared.
Predictive Analytics: It enables organizations to identify optimal inventory levels to meet demand while minimising excess inventory. Supply chain managers use predictive analytics to determine detailed inventory requirements by region, location, and usage.
SCM Visibility: Supply chain visibility (SCV) refers to the ability to track each component, sub-assembly, and final product from the supplier to the manufacturer to the consumer.