Enterprises located in areas affected by Hurricane Harvey will be under enormous stress and pressure when it comes to business continuity and, specifically, challenges with supply chains. However, there are steps businesses can take to mitigate the disruption and ensure the best response.
“It goes without saying that ensuring the safety, health and welfare of your employees is the top priority,” says Michael Dominy, research vice president. “After tending to these most important resources, we have the following recommendations to supply chain leaders responsible for planning and operating supply chain and manufacturing activities within or outside the areas directly impacted by the hurricane.”
Dominy recommends supply chain leaders take the following actions in the wake of a disaster or crisis:
- Contact leaders at impacted suppliers to understand how they are managing through the issues, what the impact is to their supply chain, and if it will cause any potential delay in products or services.
- Update your supply chain plan and adjust within the appropriate time horizons. This means leaders need to modify demand plans to reflect short term implications associated with a drop in customer orders and revise demand forecasts to reflect increased demand that will likely occur as the impacted areas recover. Also, change manufacturing plans and purchase order forecast based upon the degree of impact and how much flexibility you have in manufacturing operations and your supply base.
- Consumer goods and consumer durables manufacturers should plan on a dramatic demand spike not only as a result of a 5 day disruption to buying patterns but also in the following weeks and months.
- Distributors and manufacturers in the building industry should plan for increased demands starting over the next few months and continuing for at least two years.
- Modify customer order routing logic to direct fulfillment to alternative distribution centers, manufacturing sites or suppliers.
- Analyze your transportation network and carrier base. You may need to source transportation in the spot market and to a greater extent than anticipated.
- Start your search for warehouse space outside disaster areas as quickly as possible so you can supply customers with affected warehouses.
- Within the next 3 to 6 months conduct a supply chain network design / redesign analysis to help with longer term decisions about supplier, manufacturing and logistics networks.
Free Gartner supply chain management research
Gartner has gathered several pieces of research regarding supply chain management in the wake of a disaster and made them freely available.
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