Supply Chain Recovery: Logistics Post COVID-19
Freight and Logistics organizations have been on the frontline since the very beginning of the COVID-19 crisis, keeping shelves stocked and critical production lines running.
The speed and scale of the escalation of the COVID-19 crisis require continuous end-to-end assessment, optimization and monitoring.
Leaders in the Freight and Logistics industry have already excelled by creating Response Centers to monitor, plan, and react to every challenge.
Smart leaders will seize this opportunity to take swift action to position their businesses for greater resiliency and productivity in a future where ‘business as usual’ no longer exists.
There are three major considerations that Freight and Logistics providers must keep in mind as they retool going forward:
1. eCommerce is surging
Last mile service providers and eCommerce are rapidly increasing their market share and their logistics capabilities. Customers have dramatically increased online orders and home delivery of food and supplies, and future service expectations will change.
2. Customer supply chains will change
The lockdown in China sent shockwaves through supply chain professionals, who are now rethinking their sourcing and logistics networks in order to reduce future risk.
3. Global economic growth will slow down
All indications point to a major reduction in economic activity, one of the worst since World War II. Since logistic services are a derived demand from the movement of physical goods, there will likely be a significant negative impact on the sector long beyond the current health crisis.
Accelerate your plans
Respond to the eCommerce surge. Strive to meet the raised customer expectations as eCommerce providers increase market share and logistics capabilities.
Automate physical processes and facilities. Consider future workforce resiliency benefits when investing in physical automation or future technology. For example, co-bots and worker-plus-machine could be effective and safer in a future health crisis.
Update technology capabilities to enhance flexibility. Incorporate workforce flexibility requirements in future technology investments and initiatives. Ensure your IT systems have the bandwidth, security, and remote systems protocols to enable working from home at scale.
Rethink people-heavy processes. Standardize, centralize and automate non-customer facing and non-core tasks
Move to a digital future
Become a data-driven enterprise. Data-driven enterprises are those that maximize the value of data and treat it as a strategic asset to anticipate and respond to future events.
Create the Ultimate Agile Enterprise. Model organization, processes, and technology to achieve speed, adaptiveness, and stability.
Establish a Control Tower. Monitor the regulatory, market, customer, and competitive environment to execute with certainty as markets begin to re-emerge.
Build virtual branches. Explore the possibility of converting smaller physical branches into permanent virtual branches.
Strengthen the network
Rebuild the last mile through collaboration. Demand for last-mile delivery has exploded and will likely remain higher than normal after the crisis. Build partnerships to orchestrate a smart last-mile network.
Rapid adjustments to cost structure. Adopt an accelerated strategic cost assessment and reduction program. Flexible staffing could help with administrative or operational functions.
Adapt the Network and Services. Evaluate and re-align network models, locations, and service capabilities for the New Normal. Keep monitoring customers’ operations and regulatory bodies to adapt network nodes and services to what evolves.
Position for a growing Chinese market while the rest of the world remains in recession. The logistics system in China is already back up and running at around 80-90 percent functionality – and production and domestic consumption is expected to soon follow.
Freight and Logistics companies who act and adapt now will lead the way in the supply chain recovery and will be better positioned for a post-COVID-19 world of the new normal.
SecurCapital is here to assist you with a broad range of supply chain services, technology operational enhancements, and crucial working capital. In the current, unique climate, at worst you’ll create zero change but at best, you could revolutionize how the business operates.