Executives’ worst supply chain nightmare
In honour of Halloween, eyefortransport asked six of the speakers to the upcoming European Chief Supply Chain Officer Forum in Antwerp to reveal some of their worst supply chain nightmares that came true, what they’re doing to guard against future disasters, and what would help free them of supply chain fear.
The six executives are Guido Jacobs, head of EMEA distribution and logistics, Trimble Navigation; Robert Vallender, head of physical logistics, corporate supply chain, Nestlé; Massimiliano Bartolozzi, CIO and supply chain director, EmilCeramica Group; Robert Srumf, director, inbound logistics and LSP management, Nokia; Joannes Van Osta, general manager, group transport and logistics, JCB Excavators; and Joost Riemslag, EMEA director of supply chain and customer services, Rockwell Automation.
What supply chain nightmares have you had to deal with in your career?
Jacobs: My supply chain nightmare was about the volcano eruption in Iceland. This has obliged us to face some interesting challenges to complete.
Vallender: Been in three earthquakes , one tsunami , five bombings , one coup, numerous recalls , fake products, airline strikes and high-jacking with fatalities . I think that is enough !!
Bartolozzi: Ceramic tile logistics, and SAP APO implementation in the ink business.
Srumf: The volcano ash cloud, and no aircraft operating in Europe.
Van Osta: My first reaction to this question is none really, since I think in opportunities and challenges. Talking challenges then, I would see as a top three in my career: When working at Federal-Mogul we filed for Chapter 11. Keeping the supply flowing when you aren’t allowed to pay outstanding invoices to suppliers and logistics service providers is a challenge, but we kept it flowing.
The other two would surely be 9/11 and the recent Icelandic ash cloud because they both prevented air freight over an extended (and as importantly, unpredictable) period.
Riemslag: Tornado’s disrupting Puerto Rico and hence our production out there; the Pope visiting Denver and completely disrupting product in- and outbound traffic for a few weeks (air freight); South African Soccer World Championship during which it was extremely difficult to bring product in and out of the country; and of course, the 2008/2009 crisis during which all demand went down and supply had to be switched off.
In the wake of earthquakes, tsunamis, and other natural and unnatural disasters, what are you doing to insulate your supply chain from future nightmares?
Jacobs: Try to think ahead and create a Global Disaster Recovery Plan.
Vallender: Land selection, braced buildings and racking, multiple transport options and reliable communications.
Bartolozzi: Hoping that none of the above will impact us deeply.
Srumf: We’ve prepared already for alternative supply chains, different transport methods, fall back solutions, workarounds, etc. We are prepared with concrete predefined solutions; agree also with our partners possible workarounds beforehand.
Van Osta: I tend to compare transport and logistics to the oil in an engine: at first glance not the most sexy, sophisticated or highly engineered part of an engine, not visible either (unless you have a leak), but you can’t do without it, and there is in fact a lot more engineering behind it than the eye meets.
We are creating more visibility within our supply chain and have entered into a long-term partnership with one LLP for our global manufacturing and aftermarket supply chain. More visibility amongst others will allow us to manage black swan events better.
When these events do occur we should be able to more easily run “what if” scenarios and anticipate net effects and initiate the appropriate reactions.
Riemslag: Enabling for negative and positive flexibility (fast shrink and grow capability), plus anticipating events and happenings with pro-active planning and execution. Making sure that there is enough financial flexibility in the processes/organisations to keep operating expenses in line and in the right ratio with revenues.
What dream supply chain solution would help you sleep nightmare free?
Jacobs: A system that provides a global overview of our supply chain challenges and that everyone has access to.
Vallener: An intravenous system of feeding nutrition and getting coffee to the population and all you would need is a dosing system linked to the credit cards.
Bartolozzi: A global supply chain marketplace.
Srumf: Agile, flexible supply chains in which changes are possible in weeks and real innovations are driven by partners (as most of them today are only in reaction mode).
Van Osta: A local supply base with infinite capacity, complete flexibility at the best available cost on the one hand and a steady and constant demand from a patient customer base with no financial constraints on the other, with both sides of the equation linked with a levelled output of the right product at the right time delivered by logistics service providers adhering to a 100 percent on-time and damage free delivery, at the best available cost in the market. Although just thinking it through this would probably be that worst nightmare you asked me about, since I would probably be out of a job!
Riemslag: A world where customers would be patient all the time. I guess supply chains are like real life, they have ups and downs, we need to take these into account and work them pro-actively.