Navigating Supply Chain Disruptions and Crisis Impacts: Insights and Strategies
Discover the challenges in the supply chain with insights on the impact of crises, such as COVID-19, and learn about strategies for resilience and recovery. Explore examples of stress on suppliers and the importance of situation awareness in crisis management. Get ready for upcoming financial services regulations and outsourcing implications.
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Presentation Transcript
Crisisinterface Crisis in the supply chain: here be dragons Gareth Jones 24 June 2020 2
Covid19 - cascading impacts Covid 19 DEBT/CREDIT Reflection Resilience? Recession CNI and foreign policy Globalisation v nationalism? ????? ? Flash? Conflict? Environment? Cyber
After the crisis: impacts vary by business extinction. damaged. zombies . growth. winners. losers. investigation. low people confidence. review. investigate. safety committee. move-on. don t learn, retrench. refinance. death-spiral. job-losses. management change. forced spend. remediation. new risks. forced strategy change. innovate.take competitive advantage. public inquiry. resign. dismissal. fines. penalty. legal. suicide. pay lawyers. laws. damaged industry. apologise. insource. reset relationships. management system. change PR agency. loss of trust. head of comms sacked. social media arrangements. new suppliers. new scrutiny. soul- search. build-bridges. renegotiate. supervision. change attitudes to prevention. control regime. blame. scapegoat. promote. loyalty. complacent. become resilient. learn. forget and move on 4
Examples of stress on your supplier Business strategy Pressure on numbers and debt raising refinancing? restructure? emergency board meetings? management change? Decisions freeze investments freeze e.g. key decisions not made, old systems run on, loss of key knowledge Concentration on core market/clients re-negotiating Cannot keep up with market shift low innovation capacity Operations Sub - supplier failure Cost increases resisted Quality? Bad news gains more gravity longer time before notification People Stress, burn out and denial Loss of corporate knowledge New sub optimal teams Hiring freeze Disgruntled employee Governance Control functions pared back Price criteria dominance in procurement
Situation awareness CM operating model Situation Awareness defined as the state of individual and or/collective knowledge relating to the past and current events, their implications and potential future developments (source UK Cabinet Office). In plan language - means always knowing what is happening in the system and quickly detecting problems or variations so these can be evaluated faster against the known environment to be able to make more informed decisions and proactive interventions i.e. to LEAD not follow Example: Agriculture ministry crisis management operating model Government crisis management leadership Leader support COS, legal etc Minister Departmental crisis management team (core) SA teaml* Team members Stakeholder engagement and communications team Issue Task force(s) e.g. ports/borders, storage, distribution, aid etc Phase 2 (Recovery and Learn) and Phase 3 (Transform and improve) Task force Advisors and challeng e group Liaisons
So whats: Here be dragons 2nd and 3rd level impacts inbound???? Upstream supply chain fail more probable (#1 tech) Internal supply chain fail risk increase Downstream demand and scrutiny - changes perception of YOU as their supplier DO: Risk review across domains (fin and op risks) Overhaul crisis management and situation awareness systems for early warning (fin and op resilience) You need the right end-to-end operating model to cope with unexpected! Scenario plan (what if) and mitigate loss of critical supplier (incl cyber) and renew relationships Run exercise on major supplier failure to gain awareness
Questions Gareth Jones Crisisinterface https://www.linkedin.com/in/gareth-jones-7a90994/
