Apr 12

An Ode to “B” Customers

Those of us who read supply chain magazines and books have read a lot about the wonder of “A” customers who supply the bulk of the companies’ profits and how to focus your supply chain to serve them efficiently. A strong argument can be made that where an organization should spend a significant effort and band width on “A” customers..

As almost in any manufacturing setting, workers in the field will tell you, the so called “B” customers will be the customers that keep the company sustainable. The whys of this are below. The “B” customers are significant larger number than “A” customers in most cases. From a supply chain perspective, your transportation providers are likely to know these customers on a one to one basis and handle the more nuance needs of the “B” customers.

Coincidently to writing this blog, TranzAct’s Mike Reagan, sent an email this week to his email audience telling about Sidney Yoshida. TranzAct is a supply chain firm which does supply chain consulting, LTL/TL sourcing and freight bill auditing.

In 1989, Sidney Yoshida essay entitled: “The Iceberg of Ignorance”. which said:

  1. Top Management knows 4% about the issues of the company.
  2. Next level of managers know 9% about the issues of the company
  3. Team Leaders know 74% of the issues of the company
  4. Front line worker know 100% of the issues of the company.

So this statement is a little bit over the top, but certainly true that many top-level managers just do not know (or sometimes cases care) about the details on how the market and customers really work. I have certainly seen disconnects from the knowledge in the field about customer needs and top management perceptions. The best run supply chains knows about the gap in information from the field and work diligently to obtain its inputs. Here is why significant time and resources should also be spent on “B” customers.

“B” customers are important to keep a company in business and sustainable. The usually large number of “B” customers are what covers the fix costs of the business. Since they are profitable customers the organization size is built around the demand needs of “A” and “B” customers. I have never seen a study of this, but without the “B” customers the “A” customers would not likely be profitable as fix costs will not be covered. While some “B” customers will come and go, many will be regular buyers of the company’s products. Their business is critical to the firm’s success. Many of these customers are on a first name basis with sales, customer service and sometimes even with production workers. They are source of demand information. When they complain, it is probably a good thing to listen to, heading off bigger problems and lose profitable business.

A lot and time and effort goes into designing a firm’s supply chain. Demand and supply planning, data management and automation take up time and money in most supply chains. In some cases, there is a disconnect supply chain suppliers, including trucking, and outsourcing partners. For the supply chain function well, this information disconnects must be factored in. I have time and time again found the field work outside the supply chain process to get necessary work done. Many times in practice, this information is put into the comment section of the order, so the work around can occur,

I am bit chagrined by the lack of discussion on “B” customers in supply chain literature. It is like they don’t exist. This is an area where there can be some improved processes.

Posted in Logistics, Logistics IT Security, Logistics Software, Management, Process Management, Supply Chain, Supply Chain Software, Sustainability | Leave a comment
Dec 07

Supply Chain Resiliency on a Micro Level

Lots has been written about Supply Chain Resilience since the Covid Pandemic started in 2020. Yes, it is important for the overall supply chain to be resilient. Planning for alternate production and supply sources is a good process.?Things fall down is on the local, individual level.?You can have the product you need and no way to get it to an “A” customer faster than normal. There is system resilience in the big picture but sadly the actual system delivery process is not designed for resiliency.

Let’s create a scenario to make this clearer. An “A” level customer has an emergency order from one of their “A” customers. Before ERP’s, TMA’s and warehouse systems were created, the sales person upon hearing from one of the assigned customers has a rush order, might call the plant supervisor, who can create the product by rescheduling some of the production facility in the plant to product the needed product. Maybe it is known a “C” customer shipment can be delayed. Transportation upon learning of the need, can call his biggest and most important carrier and say we need extra truck which needs an expedited delivery. For the volume business regularly tended, they will work to deliver the special need. There would likely be a higher than average cost, but for “A” customer this can be worked out. Plant shipping management would be advised and they would schedule their dock accordingly. The customer receives the product on timely basis. Their business is maintained and when a competitor to shipping organization comes in with a few pennies savings per SKU, the receiving customer remember the service received and says no the competing supplier.?

Today, in our digital world, there are organizations where this is impossible unless you operate out of system, which is not a desired process. When massive systems are created, resiliency on microlevel is many times blocked by the software system design. Plant schedulers cannot reschedule. Transportation cannot expedite. Buyers of the product often can see the big picture, which is incredibly important but may not have visibility to the day-to-day business issues occurring on the local level. Systems need to be designed to allow resilience and responsiveness to business needs.

Those organizations which allow resiliency on a micro-level have this ability will be marketplace winners.

Posted in Inventory planning, Learning from failure, Logistics Software, Management, Process Management, Supply Chain, Supply Chain hires | Leave a comment
Oct 30

Truck Freight Broker Historic Change

Convoy Logistics, based in Seattle, business failure a few weeks ago, can be used as an historic marker in the supply chain/logistics field. It means, to be successful, just having a super software model no longer guarantees success. It is a challenge to all the medium size and small 3PL freight brokers in the United States. That does not mean that there will be a bloodbath of freight brokers. Rather it means that the successful ones will need to have updated their business model.

I live in Chicago. Crane’s Chicago Business listed in 2022 fastest growing Chicago area-based companies in the last five years in the Chicago area. Three of them are freight brokers were listed. They are Transportation One, Edge Logistics and Redwood Logistics. Clearly there is a way to be a successful business.

In the early 2000’s, it seems all a freight broker needed to be successful was to have a basic super software which moved the ball forward, giving shippers opportunity to be more efficient in the supply chain and for many firms providing the first reliable data on their supply chain/logistics process.

In my nearly 50 year career in supply chain management, I probably received thousands of sales pitches from brokers. It was amazing to me, how few of those sales calls, the sales person, knew what made their organization successful. They will just tell me the broker they represented was wonderful. I attribute that lack of information, to failure of the CEO to look beyond the transaction basis of business and figure out how the organization can bring value to a particular group of customers.

There are larger freight brokers out there, such as C H Robinson which will be able to provide value to the largest firms with all its many physical and software technologies. Nobody can do it all, and brokers who can find their niche in a market, such as food, hazardous materials, etc., can be successful.

The freight broker industry in 2023, is expected to be down 20% than in 2023. A dip like that will clear firms which do not have understanding of a market in can be successful in. Yes, the business market drop was a major contributing factor in Convoy Logistics failure. I will speculate that there were deeper issues in the firm than just poor business environment.

It also says what made you successful in the beginning of the 2000’s will no longer be enough. For the majority of freight brokers, 3PL’s, finding a market niche they can be successful in will be crucial to sustaining the business.

Posted in Logistics, Logistics Software, Management, Sustainability, Transparent software, Uncategorized | Leave a comment
Aug 17

Supply Chain-Making AI Transparent

There has been a lot written on AI. It is a software that learns from previous iterations and searching the web, maybe both internally and externally. There are many opportunities to use this software in the supply chain and it will undoubtedly be beneficial.

But there will be times the incorrect or sub-optimal solutions will happen. There seems to be a word this type of issues, “hallucinations.”

My experience with supply chain software is it always had it biases. I discovered what those biases is through using the software. These biases are more pronounced when there is an unanticipated change in the market.

Right now, AI is mostly a black box. How does it make decisions?

Would it be useful to have the software be transparent on how it made the calls or decisions on a given topic? The chosen response by the AI software may have one piece of information heavier than another piece of information. For example, if recommended storing product X at a further warehouse, why did the software make that recommendation.

Software sellers love to sell the magical black box, a software that is always gives the best outcome. To make your best business decisions, there needs to be some transparency in the software recommendations came about.

Like good robotics, the best products enhance the employees of the company to be more efficient and increase productivity and safety. The organization and its employees really cannot do the best job if they do not understand what the software is telling them to do.

Posted in Logistics Software, Supply Chain Software, Transparent software, Uncategorized | Leave a comment
May 17

ChatGPT, AI and the Supply Chain

I am sure leaders of organizational supply chains just let out a sigh as yet a new wave of Logistics/Supply Chain software is coming down the pike. The main brand is known as ChatGPT, and will have other names as well as from other suppliers. I am going to call it DMT for Data Management Tool. I am going to recommend supply chain leaders look at this tool on two different levels. One for smaller applications and one for larger application

Supply Chain departments are typically organized with top people and lower-level people who has a primary responsibility of assembling data for organization understanding of what is going on and initiatives. Additionally, the lower-level people typically also handled day to day supply chain issues and are the main communication leak to others inside and outside the organization, particularly lower levels.

A smaller application DMT will make these lower level people more efficient as it minds basic data internally to the organization and externally on the web. Will these lower levels positions become unnecessary with DMT? No, because, providing context to the information, both from internal and external perspective, will still be needed. If data leads to process changes, change management will be needed and the lower level positions will need to carry this out. Supply chain processes ultimately are people management position.

This small application DMT should not be outlandishly expensive. You can some these tools for free on the web, but I believe a system working primarily on company databases and focused web sites, is worth a relatively inexpensive expense.

There are some large organizations with highly complex software and data needs. DMT, as an add on software, may have significant benefits which will make a higher cost worthwhile to spend. A large organization such as Kroger, will have different and more complex needs and software than successful mid-size firm let’s call it Joe’s Manufacturer. Both of them will benefit from a low cost DMT but Kroger would probably benefit from the larger application.

It will be interesting to see how this plays out.

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Jan 22

My 50 Year Supply Chain Career

By Julian Blumenthal

To help digest my nearly 50-year career in Transportation/Logistics/Supply Chain, it will be easier if I break it down into topics: 30,000 Feet View, Basic Job Details, Education, Technology, and I will end about the most important few months in the middle of my career, which I will entitle The Valley.

30,000 Feet View

In 1973, terms used to describe this field were transportation and physical distribution. It was a cost center. In 2023, the words used to describe the field is supply chain. Done correctly, it can significantly increase the success, marketing and sustainability of the organization. The Supply Chain field developed a lot of intellectual energy. as it became apparent there were tremendous opportunities to enhance the field. The period saw deregulation of transportation industry. After 9-11-2001, security became a major part of processes. Toyota and Wal-Mart were the early drivers of change in the field. Later part of my career, Amazon and global trade became important drivers of change.

Basic Job Details

There were just 3 employers in my 50-year work history. I will list them then briefly here with more details below. I worked at Eastern Express from 1973 to 1976, Morton Salt from 1978 to 2010, and Signode summer 2015 and June 2016 to the end of December 2022.

Eastern Express was an LTL truck line serving the East and Midwest. My Professors at Indiana University got me this job by recommending me. I was a management trainee in their Terre Haute, IN headquarters, a dispatcher at the Philadelphia, PA terminal. and lastly an assistant customer service manager back in Terre Haute. Most interesting job fuel analysis during the fuel cut off crisis of the 1970’s when fuel was rationed. When I was transferred to Philadelphia for my only midnight shift work in my career, the first thing the terminal manager said to me was I needed to change my name. That job did not work out. In 1976 there was layoff in April which included me. By then, the company which had been family oriented was sold to new owners. The new owner management was not successful as within 3 years the company was bankrupt and ceased to exist. Contributing to this, the company did not a good handle of its operating costs.

Morton Salt was the best-known salt company in America. It is reputable company with many good people as long-term employees. I was hired in part because the new manager of the department so antagonized the work force, they all quit. That manager was fired before I started. For most part in the 31 years, my realistic title was transportation analyst. There was a brief period I was manager of the department which did not work out (see The Valley portion at the end of this essay.) My best move at Morton Salt was to volunteer for the all the jobs nobody else wanted such, DOT safety coordinator of the small private truck fleet, which I managed the equipment issues also. Nobody wanted to do international freight, so I volunteered for that too. After 9-11, it led me to be the transportation security coordinator for both domestic and international shipments. In 2009, a new director of the department was hired who was not comfortable with my proactive style and I started to get bad reviews (after years of good reviews). I knew that I needed to move on, so I resigned in 2010. I do have fond memories of many special people I worked with at Morton Salt.

Between 2010 and 2015 I was in job search and here again, I meant with many people who were really talented and good people. I was interviewed by various televisions networks including a Chinese tv network about my job search. Again, I volunteered to do these, when others did not want to.

In the summer of 2015, three people in the Procurement department of Signode which handled transportation for the firm, simultaneously went on long term sick leave (all with different issues). Because one of the missing persons was head of department, a person from accounting was temporarily placed in that position. He used to work for Morton Salt and knew me, and 15 minutes into the job interview, I was offered the temporary part time position. They needed somebody who would be proactive in dealing with issues. Signode had been sold by previous owner, Illinois Tool Works, (ITW) which had a decentralized management philosophy. So, with the loss of personnel and the imperative to manage the company, there was quite a bit of work just figuring out what was going on. Between my boss and I, we begun to build a structure to manage the transportation end of the supply chain.

My work ended when people started to come back from sick leave in September 2015. But I was so thrilled to be allowed to be creative and proactive, I sent the Vice President a thank you note for hiring me. As the plan to organize the department became clearer, the company needed somebody who could be a change agent and even though I was in my sixties in age at that time, I was open to change and knew how it could be done. I restarted working for Signode in June of 2016 as a part-time employee and that job lasted to until the end of 2022.

The two major things I did were: be main field contact for work needing or being orchestrated by the corporate office and second, overview a third-party firm which did the company dispatching and freight bill payments. My management philosophy of empowering people the freedom to do their job, allow the third-party employees people to grow into their job, learn the people and issues and perform well for Signode. In due course, it was time for me to leave as the company had transferred its operations from Glenview, IL to Tampa, FL. The company was most generous spending money to allow me to train my replacement, my last three weeks on the job. Signode is a quality company with integrity and good values, and I will miss the many quality people inside and outside the company I dealt with


I majored in Transportation at Indiana University from 1969 to 1973. At the time it was series of courses primarily on government regulation of transportation modes. That regulation ended at the end of 1970’s and beginning of the 1980’s. I gained a MBA majoring in Logistics at Penn State from 1976-9178. More advanced than my Indiana courses, it was time wise before a lot of the new stuff on logistics/supply chain became common knowledge. In the early 1980’s, I took a course that allowed me to practice law before the Interstate Commerce Commission (ICC). While I was a witness in some regulatory hearings, I never practiced. In 1995 the ICC was replaced by the Surface Transportation Board. In 1986, I took a personal computer course on the top business software at the time, soon all to mostly replaced by Microsoft Office. I did gain important knowledge about the software process on computers.

So was my education a waste, as it was focused on items that would soon be completely outdated? No, it gave concepts and ways to think about supply chain issues which lasted throughout my 50-year career. I made it a point to read industry magazines and belong to a couple of professional groups that allowed me to keep current in the field.

The one major miss I see in the educational process is training its students on change management. I find that throughout all business courses. Change is just the nature of the business game these days.


At Eastern Express, while there was a main frame computer during my stay there, it was mostly used fro accounting issues. We kept track of trucks, by moving paper on clips from one hole on the dispatch board to another. At Morton Salt I started with the telephone being the only technology on my desk. Personal computers on my desk did not show up until the late 1980’s although we did have access to the main frame computer by the early 1980’s. At Signode, I started using email and ended Microsoft Teams as my main technology from my laptop.

Every organization I worked for knew there was attractive cost benefitable software out there. Except for Eastern Express, the organizations were profitable, but it was always a question where to put their capital dollars. So top management had to balance all the needs of the firm with limited dollars to spend. There were times when Supply Chain received does dollars and times when it did not.

There is lot of interesting and useful software coming out. Just remember, it is all programmed by humans, who have limited capabilities to forecast the future. The best software enhances the human worker efficient and operational success. I can foresee trucking terminals using automated, driverless trucks to move trailers in the yard. However, a firm lose a lot of flexibility and marketing capability if you replace local drivers by machines. People and technology will need to be balanced.

The Valley

I write this hoping someone will learn from this. A valley features a drop off on one side and a rise on the other. In 1993 I was manager of the truck transport section of Morton Salt. Managment was justifiably not satisfied with my performance. They were correctly felt I was not getting the good performance needed by others in the department. One day, I found out I was demoted. Since my work was my life, I was so upset I could not sleep for months thereafter. Please, never make the mental destination of your life a place of misery for a job setback. I got very sick. At that point, several good things happened. I said being sick was nuts. I knew I would shorten my life greatly if this continued. Unbeknownst to me, my brain, had been recording memories of good people doing good things. I discovered I could value myself by doing good things for people and importantly, respecting others. I realized in my past; I had let the people put me down and I internalized their comments. For me to be success, I needed to avoid that and be a positive person in other people’s lives. I brought that to my management style. So, I what I thought was the worst day of my life, was really an unparcelled opportunity to led to a better self. Job setbacks will occur, learn from them, and use that as opportunity to enhance your life and career. Don’t let job setbacks dominate your life.

Final Words

If you have this read this far, I hope this story led to some good career thinking. I am so fortunate and grateful to have the career I had. Supply Chain is constant change and reinvention. It requires not only operation skills but people skills, because it is not software or machines driving it, but it is proactive people. I wish you all a constructive future in your career.

Posted in Learning from failure, Logistics, Logistics IT Security, Management, Process Management, Supply Chain, Supply Chain / Logistics career, Supply Chain Education, Sustainability, Transportation, Uncategorized | Leave a comment
Jan 12

Supply Chain the Importance of Others

Supply Chain is team sport. On your team are not only your organization’s managers and operational employees, but also managers and employees of your customers, suppliers and 3rd party providers Just for fun, add constant change into the mix, that adds importance of everyone is in the mix.

It is strong passion of mine, to respect and empower everyone on the team.

Last week my essay was on the Supply Chain the Importance of You. Now add to this list the importance of everyone else. In this essay, I will go from the negative to positive as a way to working in this team environment.

The worst word in supply chain is the word “stupid”. If people are acting in a dysfunctional matter, making the supply chain more costly and dysfunctional, calling them lazy and stupid, while might give a moment of superiority, does not really get to the underlying causes of the problem. Most time when people are dysfunctional, it is because the process is also dysfunctional leading people to sub-optimize the process and sometimes worst. In working with others, a healthy curiosity on why they are doing what they are doing is a key to bringing about positive change to the situation or issue. My experience is that when you approach the issue from understanding and curiosity viewpoint, positive change can be accomplished.

In the real world, even obvious positive change sometimes runs into rigid roadblocks that prevent positive change. Because you cannot make change in one such situation, should not prevent one for changing the next one. Do not let one failure prevent you for having successes debugging situations in future issues.

“Change” is constant in supply chain. Processes which once work will need to be changed. To make change work two-way communication is always needed. In my career I saw many times top management imposing changes that field tried to ignore or sabotage because two-way communication was not done. Many times, no matter where you are the organization chart, you will need to instigate the communication. Communication to the field is why is this changed being proposed, and the return information needs to be heard and responded. Many times, relatively minor procedural changes can address these field issues. Sometimes these issues cannot be addressed. Nevertheless, if the communication is there, it is more likely the process change will go through.

Everybody on your supply chain team wants to be a success. One should always be concerned about one’s own success, but your success in the supply chain will also be dependent on how others perform and be successful. One needs to be aware of what makes others in the supply chain successful. To state the obvious, one can understand other people’s performance when you know what is driving their actions.

In some situation, delegating authority and empowering others in the supply chain will be a successful strategy. There is a little secret about delegating, that is not intuitively obvious. I did not figure out this until late in my career. Delegating is way to demand for the supply chain to perform better. It is way of being demanding “boss” in a positive way. Almost all of us have had a demanding boss who micromanaged everything you did. Nobody likes working in that stress filled environment. With active feedback and constructive comments empowering and delegating will work.

One of your jobs is to help your supervisors perform at a higher level. Your supervisor will appropriately ask you to meet organization goals and processes. Obviously, these have to be responded to for you to be successful in your job. Not so obvious, is your supervisor needs direction and information from you so she/he can be successful in their assignment. Communicating on the tasks and assignments the supervisor assigns you needs to be done. But the communication should not be limited by that. There will be issues, problems and opportunities you will see, which your supervisor might not that. By communicating these to your supervisor it increases that person’s success. Everybody benefits when others in the organization improve their processes.

It takes a great bit of operational and, people skill to make a supply chain work. By valuing people in your supply chain, both inside and outside the organization, it will make the job much easier to be successful in.

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Jan 06

Supply Chain the Importance of You

If you were working on AI (Artificial Intelligence) program in 2019, would you have programed, it for the Covid pandemic crisis. Of course, not, it was something which could not be visualized. Supply Chain is full of bumps, curves, panic events and surprises. Lucky you are there to deal with them. That is why the company or organization are investing in live people like yourself to handle the unexpected and yes, much of the expected too.

There is the blocking and tackling aspect of the job. There is the tactical and strategic aspect of the job. This will be discussed in my next essay entitled: Supply Chain the Importance of Others coming next week. But here I want to reenforce the importance of you. Let’s first look at the intangible presence you provide.

Just being in the job gives you presence, but its value is how you use. There arestatements of from top management about company ideals which should include integrity and safety as well as business objectives. The top people put out these ideals and business goals, but it is you that implements them. I had several experiences with a company where there was a significant turnover of personnel. As a holdover, I found I was informally teaching how the company operates, and reenforcing the ideals and goals of the company. The other holdovers did the same thing. Because of that with top management support, the companies were able to reasonably get through a potential rocky period. In short, you matter. Your actions are important. How you do actions is important.

Sustainability is a word uses to describe environmental and sometimes it is used to describe business continuation. Let’s look at this a personal level of you. Meeting the ideals and goals of the company is a way to keep yourself sustainable in a company.

There is another side to personal sustainability. If the company managers and company culture see you as a machine, continually abusing you with words, putting you down, and belittling you on a regular basis, you should move on. I certainly seen organizations where the best choice for your personal sustainability is to move on to a better place. I have seen lives destroyed and ended prematurely by the stress of a bad work situation. It is difficult to make career changes, but if you care about yourself, you will move away from those toxic situations.

Every person has the chance to contribute to the cultural and work life of the firm in positive way. Your actions are the organization’s culture. Supply chain by its nature is in the process of constant change effecting many in the organization. How the change is communicated and how feedback is heard is many times up to you. Remember you are both implementing and sometimes creating company current, even in activities which may seem mundane.

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Jun 14

Marketing and the Supply Chain

Supply chain professionals have had their hands full of issues since March 2020 when Covid hit full force. Supply chain has dealt with among other things: market and transportation variability, shortage of capacity in both transportation and warehousing, unexpectedly high-rate variability. and just for fun some spectacular cost increases. Just some of the major issues Supply Chain has dealt with.

But feel empathy for the Marketing and pricing people in your organization who have the conflicting priorities of increasing business for the firm while making an increasing profit. Supply Chain issues have thrown a number of curve balls to their work. Periodicals focusing on the supply chain have been focused on the supply chain issues but I am not seeing much written on how this is affecting the rest of the organization, besides busting the CEO and CFO budgets for the year. But the supply chain bumpy ride also needs to be viewed holistically. Here we will look at one aspect of this, the marketing process dealing with the supply chain.

Customers want stable and low-cost pricing. While Supply Chain is not the only thing making this impossible it is a major contributing component to making prices are not stable nor low.

Marketing and pricing personnel incentives are to grow the business and increase the margin. So what options are open to them in a chirpy environment. What maybe “right” for one set of suppliers and customers may not work in a different situation. Some options:

  1. Ignore the issue and hope for the best. Drawback: This does not help either the organization or its customers. Plus side: Way too easy to implement.
  2. Have variable pricing on every order to reflect the market. Drawback: Organizational complex and information being input may not be perfect. Plus side: Helps to preserve margins.
  3. Have set pricing but for short periods of time. Drawback: Will not perfectly reflect costs. Plus side: Organizationally simpler, preserves some margins and easier on the customer
  4. End providing supply chain services to the customer. See the next paragraph for detail. Drawback; The transportation and supply chain service may a selling point to the customer. Plus: Less variability in costs to worry about, helping to maintain margins

Maybe your “A” customers may have sophisticated supply chain capabilities and may be better cost wise to arrange their own freight. Maybe your B and C customers are not so capable dealing with the supply chain. There are situations where B and C customers contribute significant profit to the firm, and making easy and not to costly to buy from your organization may make marketing sense.

The role of the supply chain people here is to provide Marketing people with a realistic view of the supply chain landscape as its effects the organization and its customers. It is fair and useful, to ask what do their customers want from the organization to understand the market and maybe provide some productive thinking the Marketing people may appreciate.

Ultimately the supply chain’s role is to make the marketing area of the firm successful. Many times, asking the right questions may be the most efficient way to deal with issues.

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Nov 15

Clouded Crystal Balls

Ask any person on the street about the supply chain and they are likely to say it is messed up. Was that hard in middle 2020 to see the strain the supply chain would have when Covid pandemic let up some? It is certainly obvious in retrospect, as seen from 2021. What are the lessons from this series of events?

Let’s look at why the future was so misty in 2020 and then look at the lessons that could be learned from this.

What was logistic and supply chain professionals looking at in later spring and early summer 2020. One word I think can characterize this period of time: survival. Business suddenly dropped 30% to near 100% for many organizations. To say this was a challenging time would be a gross understatement. To survive many organizations laid off or fired personnel. Then in 2021 found them unavailable to return when the market changed and they were needed.

It was hard for manufacturers or distributors to predict when demand would return. Even hard to know if their suppliers would be in production again and if so how much production.

Many of the elected government officials’ philosophy was that government had little or no role in planning the economy other providing some temporary financial help for businesses. Proactive thinking about the future was discouraged in many federal, state and local governments.

In retrospect, when the demand faucet was turned on, could the following been predicted?

  1. Port congestion would occur once the buying binge occurred, reflective of a simmering demand awaiting the moment to occur.
  2. Truck drivers were scarce and in short supply before Covid hit, and predictively it would be worst after business returned
  3. Warehouse workers would be in short supply once business started to return.
  4. Computer chip demand would skyrocket once production began in earnest.

So what can we learn from all this?

Always plan for the next market shift even when you are trying to deal with the current market. Now is the time to think about when supply starts getting larger than demand, even as you are planning to deal with the immediate problems.

Government leaders, academics and professional organizations need to start planning for next market shift also. I do not recall one Zoom program in middle 2020 asking about what happens when the market starts to return. Many people think of government as only rules and regulations and slowness. But government is also in a position to plan and coordinate industry leaders to work together. Imagine if government leaders hosted management-union meeting-draymen teams-railroad at the Port of Los Angeles and Long Beach in the spring of 202 to plan for the upcoming surge in business?

What if businesses planned their resurgence in the fall of 2020. It many have helped if they kept so sort of contact with laid off employees indicated they would rehire them as soon at they could. It might of helped the labor shortage. Maybe working with schools for training programs might of helped.

I do believe that academics and others will study this period from what we can learn. I think we all must realize that sudden changes in demand and supply can and do occur.

Even in crisis periods, at least some time should be spent planning what is ahead. There is a major advantage just to be able to ask that question. It would even provide guidance to handling the immediate crisis.

Posted in Inventory planning, Management, Process Management, Supply Chain, Supply Chain Education, Sustainability, Transportation, Trucking, Warehousing | Leave a comment