As one of the world’s largest container vessels, the Ever Given was carrying 18,300 containers when it ran aground in the Suez Canal. The “blockage,” as it has become known, was estimated to be causing $14 million to $15 million in lost revenues for Egypt’s Suez Canal Authority each day the Ever Given remained grounded in the canal. Though Ever Given’s destination ports were Rotterdam and Felixstowe in the UK, the impact to global trade has been estimated at $400 million each day the canal was blocked. The Suez Canal blockage becomes the latest in a string of supply chain challenges. Though the destination of the Ever Given was not the U.S., delayed arrivals of vessels into the ports of New York and New Jersey have had a major impact.
“Resiliency: an ability to
recover from or adjust easily
to adversity or change…”
Using Merriam-Webster’s definition of resiliency and applying it to supply chains, we can narrow the definition to the “ability to recover from adversity or change.” In the last year and half we have all seen our share of adversity and have come to understand how various events to the supply chain impact our ability to meet our customer demands. The list of challenges we face in keeping our supply chains moving and intact, from man-made to natural disasters, are endless. Our ability to react and reduce the risk each challenge presents will be our scorecard, measuring the success of our efforts. The more we can mitigate the impact of events to our supply chain and our company’s business, the greater opportunities we will have in shaping corporate strategy with supply chain as a key pillar. The strategies deployed to maintain resiliency are taught at the highest levels of education and practiced on a global scale. For U.S. companies focused on the U.S. and Canada markets, the challenge is identifying the risks on a global scale that can impact your domestic supply chain.
To begin looking at defining your supply chain resiliency the following six steps can lead to a deeper development of the corporate strategy:
1) Map out your supply chain. Be certain to include all inbound prepaid and outbound collect movements. Be certain to include a mapping of your supplier to supplier relationships.
2) Conduct a risk assessment on your inbound components and materials to include the supplier and their suppliers. Best practice includes an assessment that provides visibility to the risk each supplier has and clearly defines those risks to your company.
3) Complete a location risk assessment on all company and supplier facilities that include natural, workforce, infrastructure, political and other risk factors that may impact your operational readiness.
4) Assess your customer base by location, sales volume, physical attributes and business practices.
5) Interview each company department with emphasis on purchasing, customer service and logistics.
6) Conduct a brainstorming session for your “what if” and leave no stone unturned.
Editor’s Note: As Rockfarm looks ahead at providing meaningful content we will be changing the delivery of our digest to a weekly one-pager. Our first one-pager hit the airwaves last week with Alana Reinhardt illustrating “The Green Side to COVID-19.” Please follow us on LinkedIn and catch all of our postings.
FOR MORE INFORMATION, PLEASE REACH OUT TO INFO@ROCKFARM.COM.
Lamb, Eleanor, (2021 April). Trucking Leaders Hail West Virginia Bill as Step Against ‘Seat Bel Gag Rule’ Transport Topics https://www.ttnews.com/articles/trucking-leaders-hail-west-virginia-bill-step-against-seat-belt-gag-rule
Associated Press, (2021 April). Chip Shortage Forces More Production Cuts by GM, Ford, Transport Topics https://www.ttnews.com/articles/chip-shortage-forces-more-production-cuts-gm-ford
Mongelluzzo, Bill, (2021 April). US retailers signal no import let up through summer https://joc.com/maritime-news/container-lines/us-retailers-signal-no-import-let-through-summer_20210407.html
Cassidy, W. B., (2021 March). Largest US truckload carriers adding trucks, but not many https://joc.com/trucking-logistics/truckload-freight/largest-us-truckload-carriers-adding-trucks-not-many_20210331.html
SC Editorial Staff, (2021 April). Supply Chain News: Amazon Workers Just Say No to Unionizing http://www.scdigest.com/ontarget/21-04-11_Amazon_Workers_Say_No_to_Union.php?cid=18573&ctype=content
Cassidy, W.B. (2021 March). US truckload driver turnover flattens as wages, demand rise: ATA https://www.joc.com/trucking-logistics/truckload-freight/us-truckload-driver-turnover-flattens-wages-demand-rise-ata_20210330.html
Szakonyi, Mark, (2021 March). CP-KCS plan to merge to create first US-Canada-Mexico railroad https://www.joc.com/rail-intermodal/class-i-railroads/canadian-pacific-railway/cp-kcs-plan-merge-create-first-us-canada-mexico-railroad_20210321.html
JOC Staff, (2021 March). UP adding ag shipping capacity through PNW Ports https://www.joc.com/rail-intermodal/intermodal-shipping/adding-ag-shipping-capacity-through-pnw-ports_20210324.html
Russon, Mary-Ann, (2021 March). The cost of the Suez Canal blockage https://www.bbc.com/news/business-56559073
EPA GOV, (2021 April). Sources of Greenhouse Gas Emissions https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions
LM Staffe, (2021 April). Preliminary North American Class 8 net truck orders impressed again in March. https://www.logisticsmgmt.com/articlepreliminary_class_8_truck_orders_are_strong_in_march_according_to_ftr_and_a