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by John Patsavellas, Institution of Engineering and Technology
Industry View from
The coronavirus pandemic has deeply impacted people in communities across the globe, sadly with significant loss of life. As the number of those recovering from the virus continues to grow, we also recognise that our world has been changed forever.
Getting basic provisions such as foods and medicines has been a major challenge for many people during the crisis, with many retailers struggling to top up their shelves and customers seemingly panic buying and stockpiling products, from paracetamol to toilet rolls.
Supporting customers and retailers throughout have been multiple groups of wholesalers, distributors, manufacturers and suppliers collaborating as players within global supply chains.
Supply chains are fascinating, dynamic and exciting – highly sophisticated, multi-layered, interconnected and interrelated distribution systems which enable companies and countries to balance supply and demand and trade more efficiently. Globally, supply chains have led a relatively settled existence for the last 50 years or so. All that is about to change, not least as a result of the crisis.
The pandemic closed many factories across the globe, as companies acted swiftly to protect the health and wellbeing of their workers and respond to rapid reductions in their inventory and massive disruption to their supply lines and logistics networks across international borders.
Some were able to maintain, and in some cases increase, production – notably some food manufacturers. Others were able to switch some of their production lines to satisfy emergency needs, such as the manufacture of life-saving products and components for ventilating machines, and personal protection equipment (PPE) for health and social care workers.
One excellent example of this was the instant supply chain created by Ventilator Challenge UK, a consortium of 21 manufacturing engineering and seven Formula 1 racing firms, led by the UK government-backed High Value Manufacturing Catapult, delivering 10,000 ventilating machines to the NHS.
Recovery from the crisis will not be instantaneous for supply chains, as individual players and businesses within the chain emerge from what may well be a sustained period of inactivity. Retaining staff and skills will be vital.
Something which will be of great interest to the government once the crisis is over is the propensity of UK firms and overseas investors, to “right-shore” (also referred to as “onshoring” or “reshoring”) back to the UK manufacturing operations that were previously located abroad. Bringing supply chains geographically closer could be a significant step in the race to rebuild resilience, reduce carbon footprints and potentially increase revenues for the treasury.
Back on the shop floor, however, what every proprietor and manager will want to know is what we have learned from all of this. Whether you are an original equipment manufacturer (OEM), or tier 1 or lower supplier to that OEM, you may well be wondering how you engineer greater resilience, sustainability and value for your business in the future.
Industry 4.0 (altertnatively describe as digital manufacturing or Supply Chain 4.0) provides a large part of the solution enabled by an array of technologies such as the internet of things (IoT), robotics and automation, machine learning, 3D printing, artificial intelligence (AI) and augmented reality (AR).
At the Institution of Engineering and Technology (IET), we believe passionately in the creation and management of supply chain ecosystems for global growth “bounce-back” in a post-coronavirus world, backed by strong and secure digital infrastructure and driven by data.
We describe such an ecosystem as a dynamic environment composed of different elements interacting collaboratively to always ensure flexibility, resilience, responsiveness, transparency and traceability.
Each connected node within the supply chain contributes to the growth of the whole system, fostering a virtuous loop of benefits for the supply chain. This can make supply chains both sensitive to change but also more resilient to change, so long as that has been factored into their design.
A toolbox of these digital technologies and capabilities can help the redesign of processes and operations to build greater resilience, thus enabling the supply chain ecosystem to better adapt to shortages and surges in the future, and be equipped to pivot quickly and smoothly.
It can connect all players within the ecosystem, providing instant and open visibility for all. For manufacturers, distributors and suppliers such visibility will be crucial in enabling where and how much stock and value resides within the supply chain and what the gaps are.
Data gathered from across the ecosystem may be analysed against agreed key performance indicators and shared among the players. Respecting the privacy of those players who require it is becoming ever easier to put into practice, with the increasing maturity and adoption of blockchain technologies. These offer new ways of permanently recording transactions within a secure peer-to-peer network.
Supply chains have struggled to balance flow and demand during the crisis. As part of their collective response, manufacturers, distributors and those within supply chains will be giving some thought as to how things can be improved for next time. (Here’s hoping there isn’t a next time!)
Even before this is all over, think about how you can make a once-and-for-all change to benefit your business. Consider and review your digital toolbox. Design stronger dynamic resilience in your supply chain ecosystem and seek out collaborative help and expertise to build it and test it out. After all, resilience and collaboration are the two words that will dominate our business vocabulary and thinking from here on in!
For more on our vision for the creation of supply chain ecosystem visit our website and download our report, Developing An Eco-system for Supply Chain Success.
For more on the Industry 4.0 technologies referred to in this article have a look at our earlier Business Reporter article, “How to make more time and money from your manufacturing operation”.
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