Accelerating Supply Chain Scenario Planning
The pandemic showcases a need to make slow-moving supply chains nimbler. Using data and collaborating with partners on scenario planning can empower companies to adapt.
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In spring 2020, when the COVID-19 pandemic had disrupted supply chains across numerous major industries worldwide and showed no signs of abating, most organizations had limited vision in terms of how they should prepare to resume business activities. This lack of clarity resulted from a confluence of uncertainties, including when an effective vaccine might be widely available and what mandates governments might implement to curb the coronavirus’s spread. As organizations and their supply chain partners have turned to scenario planning to help them “see” actionable paths amid the pandemic, such planning has become faster, nearer term, more inclusive, and digital.1 Our field research has found that digital technologies, data, and collaboration with supply chain partners are central to this effort.
Conventional scenario planning involves considering possible future states for a planning horizon ranging from three to 30-plus years. It requires a multistep deliberation process within the boundary of a single organization or its supply chain that may take a few months after the data has been analyzed. (See “A Primer on Supply Chain Scenario Planning.”) Planners revisit these scenarios when uncertainties emerge, especially as a crisis becomes evident.
References
1. “How to Adopt the New Style of Scenario Planning,” The Economist, June 2, 2020, https://applied.economist.com.
2. E.G. Anderson, R. Freeman, and N. Joglekar, “Ramping Up Elective Surgery After COVID-19 Disruption: Service Capacity Analysis,” SSRN, May 6, 2020, https://ssrn.com.
3. Anderson, Freeman, and Joglekar, “Ramping Up Elective Surgery.”
4. “Operational Considerations for Managing COVID-19 Cases/Outbreak On Board Ships,” World Health Organization, March 25, 2020, www.who.int.
5. S. Phadnis and N. Joglekar, “Configuring Supply Chain Dyads for Regulatory Disruptions: A Behavioral Study of Scenarios,” Production and Operations Management, forthcoming.
6. N. Joglekar, G. Parker, and J. Srai, “Winning the Race for Survival: How Advanced Manufacturing Technologies Are Driving Business-Model Innovation,” SSRN, May 27, 2020, https://ssrn.com.
i. C. Caplice and S. Phadnis, “Strategic Issues Facing Transportation, Volume 1: Scenario Planning for Freight Transportation Infrastructure Investment” (Washington, D.C.: The National Academies Press, 2013).