Most supply chain professionals don't need a panel of experts to point out the importance of infrastructure to smooth-running supply operations. They've seen the evidence firsthand in the protracted freight backups caused by congestion at West Coast ports in 2004 or freight stranded by road flooding after Hurricane Katrina.
What they might not always consider is just how wide-ranging that critical supply chain infrastructure really is. There's more to it than just roads and bridges. There's the telecommunications network, for instance, and the electric power grid. Not to mention the people who take charge of the operations. What follows is a rundown of some of those elements—what we like to call the hardware, the software and the middleware.
The "hardware" side
To most people,the term"infrastructure" means the physical transportation infrastructure—the roads, rail track, airports, subways and so forth that serve as channels for both people and freight. But as we see it, the "hardware" also includes some elements that aren't quite so obvious. Let's take a closer look at some of the components:
We should also note that the ability to leverage the physical infrastructure to the fullest assumes that we have adequate fleets: trucks of all varieties and sizes, planes, boats and barges, and railcars and power units.
The "software" side of infrastructure
The physical structures represent just one part of the supply chain infrastructure. There's also what we like to call "software"—the intellectual infrastructure. This, too, has a number of components. They include the following:
Linking it all together
Beyond all that, there is a category we might call "middleware," if that's not stretching the hardware/software analogy too far.Without these elements to tie everything together, the supply chain would collapse. These elements include:
For companies rushing headlong into the global marketplace, standards are something they can no longer ignore. Each time a prospective trading partner presents itself, they have to determine whether it adheres to the same standards they do and if not, how to fix the problem. The people who work daily with these issues—and work them out—are unsung heroes of modern commerce and supply chain management.
So, in the world of supply chain management, "infrastructure" isn't merely a term to throw into the conversation in order to appear erudite. It's important. It's complex. And it has enormous implications for how— and how well—supply chains work.