This is probably the “Mother of all Disruptions”, never witnessed in history. Why I say this is because of 6 reasons:
- Concept of Globalization was not so mature.
- Trade dependence and economic dependence between nations was low.
- Supply chains were not so complex – both from demand and supply perspective.
- Use of technology purely from business performance perspective was limited.
- Proportion of service economy has increased considerably.
- Large number of start-ups are staring at “zero” revenue during the lockdown period.
The biggest challenge today is the uncertainty factor and so it’s very difficult to forecast, however, the silver lining is with advanced analytics it is possible to simulate scenarios and companies can use their wisdom and be prepared to act in case of any eventuality.
The degree of impact would definitely vary with the industry and hence the time to recover, however, I firmly believe that the recovery will neither be V-shaped nor U-shaped, rather S-shaped which means recovery will have its ups and downs.
Let us look at the critical components of supply chain, challenges therein and what should organizations focus on in the short term.
While automation seems to be a way forward, however, to accomplish it in the short term is difficult. The better alternative is digitization which can be achieved quickly, it will help in automating administrative work and will improve visibility and decision making.