‘There were nearly 2.2 million mentions of “supply chain” on Twitter in the fourth quarter of 2021, some five times more than in any quarter in 2019, before the Covid-19 pandemic…’
Global supply chains were a mess in 2022, so it seems when one reads any business news article or video that year.
Since the coronavirus pandemic began in early 2020, supply chains have been thrust into the limelight. And not positively.
Ever since the container ship, Ever Given, ran aground in the Suez Canal in March 2021, just about every business newscast has a story about supply chain issues. In turn, just about every academic and political spokesman cites the supply chain as one reason, if not the major reason, for economic woes such as inflation and lacklustre growth.
And as of December 2022, it looked like the mess and the blame weren’t going away anytime soon.
As of the third (3rd) quarter of 2022, North American retailers like Target and Walmart reported they had too much inventories. China was experiencing new waves of the CoVid-19 coronavirus pandemic and enterprises around the world were paying the economic price from disrupted production and supply shortfalls of critical components.
The war between Ukraine and Russia, an energy crisis in Europe, labour staff shortages in North America, droughts, inflation, and natural disasters were altogether adding to 2022’s challenges for economies.
And unlike previous years, so-called experts from 2021 and into 2022 were pointing to supply chains as to where these disruptions were having a major impact. All of the above issues had translated into what many coined as a supply chain crisis.
There had been a lot of suggestions on how supply chains should be fixed. These range from near-shoring or locating vendors, manufacturers, and customers closer to each other to regulating international shipping to bring down freight prices. Some consultants recommended high-technology software and robotics, while others suggested simply having more just-in-case instead of just-in-time inventories.
But who among us was going to do all the fixing? Who would clean up the supply chain messes?
The first thought had been the supply chain managers. But who were the supply chain managers anyway? Supply chain managers from industry to industry, enterprise to enterprise had different job descriptions.
Some of us who were purely into purchasing labelled themselves supply chain professionals; while others didn’t and would rather not.
Practitioners of logistics—a field that consists of many specialisations such as inbound logistics, outbound logistics, transportation, warehouse management, shipping, orders fulfilment, etc.—thought they were the heart and soul of supply chains even though logistics is really just a part and not representative of the whole.
Most who worked in manufacturing meanwhile never saw themselves as members of the supply chain group even if the factories they worked in were essential links to the chain. But some of them thought they were the centre of the supply chain universe since they saw themselves as where the highest value emanates.
And then there were the planners who set the paces of production & distribution but not necessarily had much overall authority over how supply chains should be run. Some felt they had most influence over supply chains but realistically wouldn’t be able to show it.
Chief operating officers (COOs) finance executives, and sales & marketing managers didn’t see themselves as supply chain managers but the ones who laid out the strategies and policies their supply chain operations subordinates must follow, never mind that supply chains include vendors and customers outside their realms of responsibilities.
There is no role model of who we should be and would be as champions to fix supply chain messes. As much as we may point to supply chain managers to take up the cudgels of resolving whatever crisis there was, it was not clear as to who we can look for to get it done. We must first define the roles and responsibilities which we ourselves may have no inkling.
There are no silver bullets, no messiah who will save us from the thralls of the supply chain crisis. We no longer can count on so-called elegant gospel concepts which academics and consultants had preached, especially those with such fancy buzzwords such as Enterprise Resource Planning (ERP), Lean, Six Sigma, and Artificial Intelligence (AI). All these concepts are nice to hear then but hardly have become useful. Most ended up as utter failures, wrecks on the wayside.
We are not too welcoming to advisors saying: “it’s going to take hard work, time, and resources to make things better.” We in today’s competitive and challenging business world don’t have the patience and eagerness to spend any more time, effort and capital. We want results. Now.
We need engineers, not managers, to fix our supply chains.
Management is the exercise of stewardship via an assigned function in an enterprise. It consists of planning, organising, direction, and control—elements in meeting goals, formulating strategies, implementing them, and ensuring their success. We manage by overseeing people and authorising the allocation of resources. We rely on experts when it comes to solving problems. We may have ideas and decide what are the best solutions but we rely on men & women with the expertise & skills to cultivate those ideas and solutions.
Engineering is the design, invention, construction, and launching of structures and systems. Whether it be electrical, mechanical, chemical, civil, information technology (IT) or whatever field such as agricultural, petroleum, nuclear, fast-moving consumer goods (FMCG), automotive, military, etc., engineers are builders of organisations, facilities, and operations that meet the aims of whomever they are engaged with.
Supply chain engineers are builders of structures, systems, or networks that are the foundations of operations in the manufacture and logistics of products and services. They are the professionals who are in the best position to not only clean up the mess we are mired in but also boost the competitive value of our operations.
The problem is most of us, if not all of us, don’t know that supply chain engineers exist. They are virtually unknown. For the few that claim they are SCE’s, many are actually not, at least either they don’t meet the meaning of what an engineer is or they don’t address the supply chain per se.
Relationships between operating functions make up supply chains. Supply chains work when these relationships communicate and synchronise the flows of information and merchandise between functional operations. Hence, purchasing buys what’s needed, manufacturing receives what it needs when it’s needed, and converts and hands off items the logistics function needs to deliver what customers need at no more and no less of how much is needed. Planners communicate demand data upstream from logistics to manufacturing to purchasing and translate these data into schedules of materials and products at each supply chain stage.
Demand comes in different forms: forecasts and orders, and these are laid out in weekly & monthly plans and daily schedules respectively. Supply chain engineers set up a system and structure for whatever demand scenario that enables us to plan and execute our operations.
SCE’s design the manufacturing and logistics networks to accommodate whatever strategy of product deployment an enterprise adopts. At the same time, they set up the delivery process to handle the daily fulfilment of orders, requisitions, and receipts.
The scope of SCE covers the entirety of supply chains from the sourcing of the rawest materials to the very end of consumption of a finished product. The supply chain messes of 2021 to 2022 have taught us that every link is subject to improvement. We cannot fix congestion at shipping ports and not address the influx of inventories at the storage facilities where the merchandise from the ports will go to.
Supply chain engineering is a pioneering field that remains untapped even as we need to clean up the supply chain messes that continue to fester. It’s a field that is new and unknown but offers the problem-solving methodology that would complement the management and resolution of supply chain crises.
We have much to gain from what supply chain engineering offers.