Fighting the Last War

So after five months of decreasing through put, the West Coast Ports have an agreement and for the most part are going full bore to clean up the backup, which is expected to take several months. Finally! Assuming the union members ratify the agreement, which is likely, it will be five years before the port contract expires.

So for the last five months, while the dock production was slowing  down, inventory did not arrive as planned, transportation costs increased with delays and congestion fees, and all sorts of alternatives were tried.

What does this mean? It is always tempting to continue to resolve the last problem you had, much as military establishes theorizes how to win the last war. When the next war comes they are not fully prepared because techniques and strategies change. Planning on change was not a priority, winning the last war was.

So now the west coast ports are operating, don’t continue to fight the west coast shut down in your planning.  It is a known problem. Sometimes you have to follow former Defense Secretary Donald Rumsfeld’s advise and plan for the “known unknowns”.

It certainly tempting to plan for the west coast ports becoming dysfunctional again. Any supply chain strategy should recognize that various options have benefits and costs. Likely there is a role from the west coast ports in your organization’s supply chains and take advantage of it.  So do what your firm would normally do a cost planning basis which might be use west coast ports despite their past problems. But be wise, have supply chain agility because there will be problems out there somewhere.  Since transportation and logistics is a relationship business in times of stress, it will mean sometime, it will be real important to have business relationships with alternatives.  Give your organization, options in stressful times.






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