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How to Manage Supply Chains During the Coronavirus Crisis

Before the coronavirus burst onto the world stage and began changing everyday life for billions of people, businesses in every corner of the globe and every industry were transforming their supply chains to a more efficient and agile digital model.

Now the coronavirus is accelerating that change. Companies in every industry are moving quickly to deploy new business and operating models to secure customer loyalty, determine and fulfill new customer demands, and to make their supply chains more resilient. At the Digital Supply Chain Institute (DSCI), we believe the crisis has ignited a race for advantage and survival and we are working with companies around the world to help them prevail in this changing environment.

Every company’s supply chain has a different level of exposure to coronavirus. However, every company should be doing the following seven things:

  • Establish a coronavirus “war room” with cross-functional representation from key departments—sales and marketing, operations, IT and finance—to track and respond to the crisis.
  • Assess supply chain risks and determine new options for meeting customer demand
  • Review your existing supply chain data model and revise it as necessary to gather information relevant to this new environment of uncertainty and disruption
  • Inspect all suppliers (Tiers 1, 2 and 3) and negotiate favorable terms in the face of multiple conflicting demands
  • Modify logistics and deliveries to accommodate global travel constraints
  • Protect worker safety, potentially with work from home and leave options
  • Model the impact of the virus on financial performance and take the necessary measures

The disruption to supply chains caused by the coronavirus will likely last for many months, perhaps longer. Our advice is to treat the impact on supply chains not as an aberration, but as an expected occurrence in a world where political disruptions, health issues, technology advances, and climate change are all happening at the same time. It is a time to adjust your company’s processes to this new reality.

- Christopher Caine, President, Center for Global Enterprise

Christopher G. Caine is President of the Center for Global Enterprise (CGE), a New York-based non-profit organization dedicated to the study of the contemporary corporation in the era of global economic integration. The Digital Supply Chain Institute (DSCI) is a non-profit management initiative of CGE focused on the evolution of enterprise supply chains in the digital economy and the creation and practical application of supply chain management best practices.