Robert Bowman writes an article discussing how businesses have not learned from their mistakes, and disasters past are sadly not preempting disasters of the future. Neither the 2011 earthquake/tsunami/nuclear disaster in Japan nor the 2013 floods in Thailand elicited sweeping changes in the way processes are handled, and it stands to reason that the 13 deaths related to General Motors’ faulty ignition switches may wind up the same way.
The Struggle to Change
Catastrophe is met with strained efforts for change because such reforms often do not deliver the immediate return on investment that shareholders want to see. But in order to better manage risk, it is suggested that supply chains start following the “Triple-A Supply Chain” principle outlined by Stanford professor Hau L. Lee back in 2004, which stands for “agile, adaptable, and aligned.” Bowman gets specific about what needs to be done:
From a strategic perspective, companies need to map their global supply networks. In the process, they gain knowledge of the impact that a disruption will have on operations. Tactically, they should look to the end-customer to achieve a full understanding of demand, and how a fall or rise in supply will impact service. Operationally, they should be zeroing in on execution-based tasks like warehousing and transportation. Functions related to “basic blocking and tackling” shouldn’t be overlooked as important means of alleviating global risk, [Yves Leclerc, managing director at West Monroe Partners] said.
To delve further into what can be done to lessen or stop the severity of threats in the future, you can read Bowman’s original article here: http://www.forbes.com/sites/robertbowman/2014/04/01/disaster-looms-why-todays-global-supply-chains-are-at-risk/