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Learnings from the COVID-19 Crisis for Supply Chain Management

Learnings from the COVID-19 Crisis for Supply Chain Management


This article is part two of a series of three articles that details the experience and learnings for supply chains from the COVID-19 crisis and outlines strategies to address large-scale disruptions in the future. You can also read Part 1 of the series – ‘Responding with Resilience – the Indian Pharma Sector,’ which used the case of the Pharmaceutical industry to assess the initial supply chain disruptions and the immediate industry response. Further, Part 3 of the series will ideate on the ‘Supply Chain Management Strategy for the New Normal’.

The COVID-19 pandemic that has swept through the world this year has caused unprecedented health and economic distress. While the most immediate impact of the crisis has been addressed, businesses are still tackling ongoing challenges and uncertainty. In this situation, there is a need to learn from the strategy adopted by their global peers, both to address the current disruption and to prepare the future course of action.

Our deep-dive into the learnings from the industry response in the initial few months of the challenge are summarized under three distinct areas:

  1. Robust Business Continuity Planning (BCP)
  2. Risk Management Driven by the Top Leadership
  3. Innovation and Creativity in Difficult times

Robust Business Continuity Planning (BCP)

Robust BCP is pivotal in maintaining operational continuity for critical elements of a supply chain, and in recovering from disruptions rapidly, with minimum impact. COVID-19 had shown that the business continuity plans of many businesses were not effective.

To make the BCP effective, businesses must ensure a comprehensive ‘system view’ of the supply chain. In distressed situations, the decision-making process should be driven by a multi-departmental war room. Such war rooms should also have the authority and technical know-how to change internal policies and processes as and when required.

Further, such large-scale disruptions often require government interventions, and a channel for regular interaction with government authorities should be established.

Risk Management Driven by the Top Leadership

Robust risk management strategy is critical to ensuring sustainable and healthy returns to shareholders. However, the initiatives taken by the risk management team are often in silos and face challenges in implementation. To address this issue, the sponsorship and involvement of the top management are paramount.

Innovation and Creativity in Difficult times

It is important to redeploy and rebalance the available resources to address the prevailing issue and to realign the short-term and long-term strategies. Organizations can choose to refocus short-term efforts on certain critical products and consider partnering with complementing businesses to provide scenario-specific offerings.

The learnings from industry experiences provide inputs to create a working response model. Such a model is critical in sustaining business continuity during major disruptions and is enabled by rethinking and reconfiguring certain operations. These learnings can be leveraged to strengthen strategic planning in the future.

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About Nexdigm
Nexdigm is an employee-owned, independent, global business advisory organization serving clients from more than 50 countries. Harnessing our multifunctional and digital capabilities across Business Consulting, Business Services, and Professional Services, we provide our customers, both listed and privately held firms with integrated solutions navigating complex challenges. Nexdigm resonates with our plunge into a new paradigm of business; it is our commitment to Think Next.