Supply Chain:

Mitigating the impact of COVID-19 and building long term resilience

The spread of the new coronavirus, COVID-19, is being felt globally across operations in ways that are difficult to model and assess. The affected regions are at the heart of many global supply chains. Hard information is lacking; concerns are mounting over depleting (or idling) stock; and companies fear they won’t meet contractual obligations on time.

How COVID19 has slowed down and depleted interconnected,
global supply chains

Failure Points End-to-end Supply Chain Impact
Suppliers are unable to fulfil orders due to labour shortages Suppliers Stalled production, unfulfilled orders, and bullwhip effect
Transportation restrictions and lower capacity for distributors to send goods Inbound Trans Uneven arrival of needed raw materials, stalled production
Under-staffed due to quarantines and medical safety and/or lower supply DC Ops Slow shipments, inconsistency in delivery
Transportation restrictions and lower capacity for distributors to send goods Outbound Trans Limited delivery possibilities, inflated delivery costs, and delivery failures
Under-staffed, under supplied, and store closures. Lack of consumers Retailer Less products on shelves, diminished ability to serve customer
Unable to find drivers and lack of demand for certain goods Final Mile Delivery is incosistent, model for timing is faulty, and increased costs
Unable to reach end-consumers due to lack of delivery options Consumer Avoids shipping, delayed delivery timeline, and more volatile demand patterns

Five steps for immediate relief

five-steps
  1. Create a cross-functional and/or crossborder SWAT team
  2. Build additional buffer of inventory and raw materials
  3. Develop expected-case and worst-case scenarios
  4. Explore additional delivery routes
  5. Partner with retailers and third-party platforms 

Five steps for building long term resilience

Boost your supply chain capabilities as you respond to COVID-19.

Most companies are currently focused on the near-term, with their strategies addressing the COVID-19 situation as a temporary problem. But, if businesses look at the current situation strategically and align smartly, it may potentially help propel future growth and competitive advantage for many years to come.

Five ways in which current challenges will create new capabilities for companies willing to invest:

  1. Working capital management: use analytics to model net financing needs
  2. Planning capabilities: digitise to enhance faster decision making and execution
  3. End-to-end supply chain visibility: build AI-powered digital control towers
  4. Sourcing and supplier management: apply Lean Manufacturing techniques
  5. eCommerce enablement: use network modelling to balance operations with online channels
five-steps

Where to focus next

connected-supply-chain

Connected supply chain

Rapid big data processing and process automation enable real time visibility and easier management of supply chain

A new supply chain ecosystem uses advanced analytics to be more predictive, resilient and responsive

Supply chain digitisation

Supply chain digitisation

Supply chain digitisation will transform numerous key operations functions (e.g., integrated planning and execution systems, logistics visibility, autonomous logistics, smart procurement, and warehousing, spare parts management, and advanced analytics) and help move closer to a customer-centric enterprise

How PwC can help

Agile sourcing and supplier management

Enhanced supply chain visibility

Diversified consumer reach & delivery options

Webinar Series: Navigate Risk and Build Resilience for the Future

Join our webinar series where we explore topics on managing business continuity, data optimisation and transformation risks, to help organisations build resilience and prepare for a post COVID-19 operating environment

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Marc Philipp

Marc Philipp

Management Consulting Leader, PwC South East Asia Consulting, PwC Singapore

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