Amid all the turmoil in the financial markets last month, just short of 3,000 logistics professionals gathered in Denver for the Council of Supply Chain Management Professionals' (CSCMP) annual conference. Considering the external circumstances, it was perhaps not surprising that managing uncertainty was on everybody's minds.
During her opening address, keynote speaker Frances Townsend, former assistant to the president for homeland security and counterterrorism, suggested that one way to deal with uncertainty was to conduct a risk analysis. As they analyze their vulnerabilities, supply chain managers should ask themselves two questions: What do we really need? And what do we need to know? Answering those questions will identify those vulnerabilities that they should focus on, she told her audience. More difficult to handle are situations they can't affect."[In such cases,] you can at least position yourself to reduce your vulnerability," she said.
Picking up on this theme, Tuesday's general session speaker, Mahender Singh of the Massachusetts Institute of Technology, spoke to those situations that you can't affect or control. In his address, "Curved Thinking in a Flat World," Singh presented a new way for supply chain leaders to start thinking about the future. According to Singh, executives need to use scenario planning to consider different possibilities for the future and then work backwards, plotting out what they can do to get there.
So how to survive in this unsteady economy? During the executive panel titled "Unprecedented Instability Offers Global Opportunities," Rick Jackson of Limited Logistics Services offered this suggestion: "Play defense while planning for offense." Playing defense means adding discipline around expense control and managing inventory tightly. But managers have to remember to look forward as well. "We have been spending a lot of time talking ourselves off of the ledge," said Jackson. "But it truly is a cycle. While we may not know what the bottom is, we want to plan for offense so we know how to begin to ramp up when it does pull out."