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Future Manufacturing And Supply Chain Strategies
Question



Introduction

The current Covid-19 Pandemic has had a significant impact on Manufacturing and Supply Chains throughout the world, with significant disruption to both supply and demand. Such disruption has not been seen since the Second World War. The impact has demonstrated weaknesses and a lack of resilience in many supply chains that have been developed with “lean” just-in-time principles. Many supply chains are low-cost and efficient but not resilient.

Despite this, however, there are examples of supply chains, particularly in the Food and Grocery sector, that have kept going, even through country and global lockdowns. Following initial periods of panic buying from both retailers and consumers, supply is settling down. Due to social distancing rules, however, both the way we buy and our purchasing patterns have changed significantly. There are also longer-term supply risk considerations if individual countries decide to prioritise internal markets.

In other markets, manufacturers have adapted processes to supply essential equipment. Examples include Automotive Companies manufacturing ventilators, Garment manufacturers switching to making PPE and Chemicals and Beverage manufacturers making hand sanitiser.

Other considerations that have emerged include the need to support businesses, especially smaller businesses, that have been impacted by a combination of falling demand, lack of supply and social distancing requirements. This has led to a concentration on cash flow, with some businesses adapting sales channels to online and click-and-collect, and there are many examples of food and other outlets offering delivery services in order to keep going. Governments, too, have stepped in with unprecedented financial packages to help economies survive in this period of lockdown and stimulate economic recovery post-pandemic.
It is clear, therefore, that there are many lessons to be learned from the current pandemic and that this learning could significantly impact future manufacturing and supply chain practices.

Consultation
The IET Manufacturing Technical Network is planning an event early in 2021 to discuss future strategies for Manufacturing and Supply Chains arising from the current crisis. To assist in the planning of this event we are launching this discussion blog to seek input on suggestions for topics to cover.

We invite you to provide detailed comment and feedback to any or all of the following questions:
  • What Manufacturing Strategies would minimise impact of future global disruption?
  • What will be the impact on future supply chain configurations?
  • How can manufacturing companies support lower tier organisations in securing business continuity?
  • How can the financial sector help reduce impact and support manufacturing recovery?
  • What are the implications of re-purposing on both manufacturing facilities and product design?
  • What are the implications for smaller manufacturers (SMEs) and lower tier suppliers?
  • What is the impact on Manufacturing aspects of National and Local Industrial Strategy?
  • What are the implications for Environment and sustainability for Manufacturing?
  • What types of support should be expected from Governments and local authorities?
  • What are the implications for the education sector for future skills development?
  • Are there any other aspects that need to be addressed that are not covered in these questions?

 
5 Replies
Certain strategies refer to "on-shoring", a reversal of the process of "off-shoring" which has seen many companies moving the purchase of raw materials, commodities, components and whole systems to low-cost-countries. Even as these costs have increased over recent times they are still, in most cases, far cheaper than local supplies.
However, certainty of product, as well as product quality, is now a major concern following Covid-19 and the disruption in the worlds supply chain that it caused. This coupled with the advances made in AI, IOT, Robotics and all things I4.0 related could help to create a strong pull to the on-shoring strategy.
Adam Hall
1 Posts
Industry 4.0 Supply Chain Monitoring
I would be interested in understanding if I4.0 thinking can be practically implemented to monitor long supply chains involving multiple partners.  Is it possible to overcome security, privacy and data ownership issues and easily generate systems that can monitor production, quality and logistics metrics through the entire supply chain to give early warning of issues and/or notify of sudden changes in demand.  Are such systems widely being implemented and are there any published case studies.
Eliza Baty
2 Posts
I think looking realistically at what work can be done from home in the future will change things a lot in the future. More outworking would potentially prevent situations arising like this again where a pandemic could make the economy freeze. Honestly, I think people are happier being able to spend time with their families too, so there is a quality of life aspect to it as well which will pay dividends in terms of loyalty and effort. We probably need to look at more 'in house' production for manufacturing rather than going for cheap options that involve buying in from other countries. In China they can produce everything under one roof. That is what we have to compete with. We should try and see if we can do the same, or help supporting companies to develop around our existing manufacturers so that they can continue to produce competitively. If we work as a cohesive team, we could get through this (and Brexit >_<) a lot easier. If we try and go it alone we will fail.
Whilst our retail food supply chains have been maintained, the pandemic has brought other aspects of the design and operation of our food supply chains into public and media focus:
  • lack of online delivery capacity
  • immediate shortages of flour and baking ingredients
  • reduced foodservice demand creating imbalance, for example beef steak v beef mince
  • unwanted beer and milk going down the drain
  • soft fruit rotting in the field because of a lack of traditional migrant labour 
  • factory hygiene conditions causing virus hotspots
  • questioning of the value of BOGOF promotions
These aspects reflect the balancing act between availability, cost and all the other competing metrics on which our supply chains are judged. With hindsight, will the pandemic cause us to measure differently in future, because tell me how you'll measure me and I'll tell you how I will behave.

  
Paul, Adam, Eliza and David, Thank you for your responses to this forum. Your contributions are important and we value them as input into the event we are organising for Q1 2021. All these issues are important and will, hopefully, be addressed in the event we hold.
 

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