SCMAP Perspective is our fortnightly column on PortCalls, tackling the latest developments in the supply chain industry, as well as updates from within SCMAP. On this column, we explore the question of planning and executing good supply chains in light of the pandemic.
Who’s got a plan?
The main question posed in our SCMAP Live event last week went like this: what’s more important, planning for your supply chain, or executing it?
The context, of course, is the pandemic, particularly how it brought to disarray a lot of well-thought-out plans for the year. Suddenly restaurants can’t count on foot traffic in malls. Suddenly manufacturers of cleaning products can’t count on sales coming from the hospitality market (although increased sales from household consumers may have made up for it). Suddenly delivery companies find themselves in really high demand due to stay-at-home orders. You get the idea.
In that case, it’s easy to say that it’s the execution that matters. It’s ultimately all about giving the customers what they want – and considering the chaos of the early months of the pandemic, one can assume they’d be more understanding of the circumstances. But it’s ultimately not sustainable. For one, businesses will find it difficult to respond to ever-changing situations – high or low supply of raw materials, shifting demands from certain demographics, availability of labor and machinery to produce the products. Constantly implementing ad hoc measures – “para maitawid lang”, to put it one way – will eventually be costly, will not guarantee service levels, and may impact a business’ competitiveness in the long run.
But what’s the use of a plan if it no longer applies to the current situation? Why continue working towards targets that are no longer relevant, especially in such a sudden, drastic manner? Yes, you can revise those plans, but why get stuck in some sort of analysis paralysis when you can just hunker down and get to work delivering for your customers?
It has been a difficult year and a half for companies, whether large or small. The pandemic has proven disruptive even to those who are most prepared. With coronavirus restrictions still somewhat unpredictable and inconsistent – and with lack of a roadmap towards controlling the pandemic – planning for the long term has become tricky at best. (As I write this, Metro Manila is headed for ECQ once again, and the questions we’ve been getting are all “so what does this mean?” even if the rules have been set long ago.) Some may have bounced back early, whatever that means, but for smaller businesses who found themselves with almost no access to customers, raw products or means to deliver their products, getting back on their feet is a monumental struggle.
Still, planning goes a long way in ensuring that a business is focused on its targets and goals. It solidifies how a business aims to achieve those targets, how it aims to serve its customers, how it aims to add value to its shareholders and partners. To put it in lofty terms, a supply chain plan captures what a business stands for.
Sure, there is a need to constantly revisit and revise these plans as situations change and far-off uncertainties get less hazy. This is where the importance of collaboration comes in. Having the right technology will make things easier, but ultimately having departments and functions be on the same page ensures that everyone is aware of where a business is at, what each person is able to deliver, and adjust accordingly in line with customer demand. We’ve seen over and over how the best supply chains in the world achieved that status not necessarily because of its reach or its technological prowess, but in how different parts of a company work together in sync to deliver for its customers, barring the most extraordinary of circumstances – and even then the disruption won’t be as large as one would fear.
So, what’s more important: making a plan, or executing it? It’s really a chicken-or-egg situation, isn’t it?