The Future of Procurement: Making the Most of a Perfectly Good Crisis

It feels like there has been some sort of shortage of virtually every product at some point in 2020 and 2021. One thing that has been plentiful is supply disruptions; there have been plenty of those. The weak links in the chains were often revealed dramatically by reaching their breaking point. So, where do we go from here? We’ve learned so much, but how will organizations make use of the lessons from a global pandemic-meets-canal-blockage-meets-cyber-security-threat-meets-weather-disaster situation? While spring of 2020 brought many thought pieces about how immediate changes needed to be made, the further we move on, the more it feels like supply chain professionals are ambivalent about significant changes.

The current U.S. administration thinks that big changes are necessary and is creating a Supply Chain Disruptions Task Force. The task force is intended to address short-term discontinuities in the supply chain, but it sounds like the aim is to improve supply chain resilience in the future as well. The task force will focus on home building and construction, semiconductors, transportation, and agriculture and food, some sectors that were hit the hardest by disruptions.

While the current U.S. Presidential administration is on board with a pretty significant overhaul to 21st century supply chains, it seems unclear if the business community is also on board.

There was a feeling of panic about supply chain disruptions in spring 2020, and an urgency to make changes was felt. After a year of turmoil, it often feels as though the panic has morphed into a shrug. A recent Gartner survey found that nearly half of all supply chain professionals don’t have plans to increase available stock within the next two years.

Here’s another interesting statistic gleaned from the same report:

  • The survey found that 21% of 1,339 respondents considered the availability of safety stock to be a top-three indicator of supply chain resiliency. The top responses to resilience indicators were order fulfillment cycle times not being disrupted (43%), positive consumer feedback (40%) and perfect order fulfillment metric not significantly disrupted (36%).

While a supply chain free of disruption is ideal, it is unlikely that any supply chain will exist in a disruption-free environment. Yet, it sounds as if only about half of supply chain professionals are making plans to create more resilience in real-world supply chains. As we move forward, it’s essential to have a strategy for building a more resilient supply chain, not just a goal of having a supply chain free of disruptions.

It’s part of human nature to become complacent. After a medical diagnosis, many of us might create a diet and exercise regimen only to give up a few weeks later. But like personal lifestyle changes, organizations do not need to take an all-or-nothing approach. We can make small, sustainable changes that we can commit to.

Since many of our organizations have had the stress points and weak supply chain links revealed, now is the perfect time to analyze those systems, processes, and suppliers. Those individuals and organizations that are spending time analyzing pain points and solutions are the ones who will be well positioned when the next disruption hits. We will all move on from the current crisis, but what’s the point if we’re not better off and stronger than we were before?