Supply chain practitioners have fallen into the trap of tunnel vision. Lean manufacturing. Offshoring. Outsourcing. These tactics do not necessarily lead to best value decisions.
The coronavirus is a good example. Unfortunately, the opportunity to prevent logistics damage in many supply chains due to the coronavirus has passed. It isn’t just Apple with business challenges erupting at lower levels of the supply chain.
Placing all the sourcing bets with China did not reduce risk; it compounded it.
Logisticians are now in containment mode. The US military provides a relevant frame of reference. According to the Military Times, the DoD is moving out with “Containment, cancellations and quarantines — the Pentagon’s latest plans for dealing with coronavirus.”
What is your containment strategy to deal with the close-in logistics risk? Beyond immediate containment actions, have you started moving to evaluate the tiers of your supply chain and manage risk across the portfolio?
For too long, many logisticians have thought that best value and low cost are the same thing. Best value decisions in supply chain and logistics demand a balanced perspective.
Define what best value – not low cost – logistics means for your network.