Hurricane season has taken on a much different form this year as we watched Harvey flood the Houston region. Then Irma pummeled Florida and its devastating impact continued through the Caribbean. In addition to those two, Mexico had the worst earthquake in two decades and typhoons and more have been making its grand tour through other regions. We stand back and wonder how much destruction could happen in such a short period of time.
Through globalization we have become so interconnected. If a disaster occurs in Mexico, then it sets off a chain reaction that affects many companies that aren’t even headquartered in the region. Companies like Rubber-Maid faced trouble when their resin plants were shut down due to Harvey’s flooding which caused a ripple effect in their business. Later, Port Houston was closed and stopped all imports that usually pass through that region and even ones that were to continue on to Canada.
So how exactly is a company supposed to prepare for natural disasters and unexpected conditions like Harvey and Irma? They can take notes from Levi’s and is preparedness with Hurricane Katrina. Due to the transparency in their supply chain, they were able to know which shipments were heading where and at what time. They were successful in holding merchandise back in Latin America that had not yet departed for the U.S. Also, they were able to divert some that were destined for the South and had the rerouted to different docks and ports.
Sourcing Journal online has some footnotes on disaster preparedness for the supply chain:
- Connect all business partners in a single, integrated cloud-based platform.
• Enhance visibility of supply chains, including second, third and even fourth-tier suppliers.
• Collaborate with suppliers in real-time via cloud-based platforms.
• Improve control of key operational and quality processes.
• Enhance agility to improve responses to adverse changes in external environments (Sj, 2017, para. 9)
While no plan is bulletproof, it’s like that age old saying, “an ounce of prevention is worth a pound of cure.” And, that’s definitely the case when millions of dollars’ worth of shipments are involved. In the end, knowledge and transparency of the supply chain is the most effective way to spot potential problems before they happen. Without this, necessary preparations will be much harder to make and possibly will be too late.