With effective logistics planning and strategies, you can run a supply chain smoothly without too many concerns. However, disruptions can occur even with the best plans in place. If your company encounters a supply chain crisis, it is important not to panic. Panicking can lead to a number of hasty decisions which can make the situation worse. Assess the situation and develop an approach that minimizes losses and resolves the crisis as quickly as possible.
Read for five steps you can follow to solve a supply chain crisis.
Develop a response plan for major disruptions
Contingency plans are a must if you want to keep disruptions from becoming a supply chain crisis. Identify which suppliers are the most important to your company and the least replaceable. Once you know your major risk areas, you can develop a plan to minimize disruption if there is an issue with your supplier.
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Another possible disruption to consider is a natural disaster. For example, if you operate in an area prone to bushfires, you need to consider how this will affect the roads and infrastructure. Unforeseen circumstances like these can disrupt transport and easily turn into a crisis. Having a detailed plan of how to deal with issues like these will ensure that your employees are prepared and able to handle a problem before it becomes a supply chain crisis.
Encourage crisis management training for employees
It is important for your management team to undertake adult training in supply chain management. This will ensure that they are aware of key procedures and strategies to implement should there be a crisis. You want to build a team that is able to identify and respond to a crisis as soon as possible. This means you need a supply chain manager who has the knowledge and expertise to handle such circumstances.
You can encourage adult training by offering free workshops and classes for your management team, or offer reimbursement for supply chain management courses. In the long run, you will be benefiting your company by having a reliable and well-trained management team who can handle a complication as it occurs.
Keep calm and make calculated decisions
Take a proactive approach to the situation. You cannot prevent disruptions completely, but you can develop a reasonable approach to handling them. Make a detailed assessment of the damage that has occurred as a result of the disruption. Calculate your losses and be sure to report this all to your superiors so that they have the full scope of the situation.
After you have assessed the damage, begin to make decisions on how you rectify the situation. Refer to your contingency plans, contact backup suppliers and make sure that you are working with your team to get everything running smoothly again.
Look at the bigger picture
Address not only immediate issues but also small disruptions that may escalate. It is difficult to pinpoint how a complication on your end can affect the rest of the supply chain, so it is important to look at the bigger picture and see how the problem will affect the rest of the workplace. Remember, you must see yourself as a working within a network, not as an individual. Just because you see something as a minor problem, doesn’t mean another person in the team will.
Consult with your whole team about different issues that arise to see how they feel it should be approached. There may be complications that arise which you don’t even know about, so it is important to have the input of your supply chain managers.
Take responsibility for your actions
If you know that a decision you made has led to a bad outcome for the company, own up to it and take charge of it. There is no need to waste time pointing fingers and playing the blame game. If you know that an issue has arisen, you must take the appropriate steps to rectify the situation.
Work with your team to mediate the situation and reduce losses. In any crisis, you need the help of your employees to help get things running smoothly again. Do not try to fix the situation on your own, make sure you have the thoughts and assistance of your superiors and the rest of your team. Regardless of who is to blame for the disruption, everyone needs to be on board when handling a company crisis so that it can be resolved quickly.
If you are looking to expand your knowledge of crisis management in supply chains, consider undertaking an adult training course in supply chain management.
Helen Sabell works for the College for Adult Learning, she is passionate about adult learning. She has developed and authored many workplace leadership programs, both in Australia and overseas.