“Uncertainty is the refuge of hope.” – Henri Frederic Amiel
The crisis, uncertainty, and disruption that COVID-19 has brought to the global supply chain is a moment of reckoning. The pandemic has struck every node of the supply chain from global corporations to end users to the core. The disruptions in the food supply chain has reengineered the thoughts around global food security. The crisis has pushed us to the brink of thinking how interdependent we human beings are, how interconnected our supply chains are, and how unprepared we all are to face these types of challenges.
Farmers around the world are dumping thousands of gallons of milk, crushing tons of eggs, and throwing thousands of tonnes of fresh produce to the pit as there are either no takers or it is more expensive to harvest from the field compared to the expected selling price. At the same time, in many parts of the world, consumers are struggling to buy fresh food and are compelled to pay higher prices owing to disconnected supply chains – in one region tonnes of food is left to rot whereas there is insufficient supply of food prevailing in other. The closing of restaurants, pubs, bars, hotels and schools has left many farmers around the world with no buyers for more than half their crops – which is left to rot in the field. There is a widespread destruction of fresh produce due to social distancing rules, shortage of labours, lack of buyers and absence of required transport facilities. These staggering disruptions coerces think tanks across the globe to revisit the current strategies, capabilities and weaknesses within the food systems. The current pandemic necessitates reinvigorating strategies and coordination among important supply chain stakeholders to repair the damages and resurrect the preparedness for a future disruption such as this.
Refining Strategies: it requires a unified strategy to ensure the food supply chain is unbroken. Although, lean, agility and just-in-time (JIT) and build-to-order (BTO) supply strategies have been doing good to many industries, a global disruption like this compels us to rethink what is a right balance between lean and agility. What strategy would ensure that our supply chain would not be stretched out even if we follow lean principles? We can no more enjoy a healthy food cupboard without bothering the wellbeing of the farmers who produce it for us. Our policymakers are required to understand how connectedness can be maintained while initiating actions to safeguard the wellbeing of the masses. It is imperative to execute a lockdown that does not stop masses from getting essential supplies.
Connecting supply chains: the importance of connected supply chains has never been more. The disruptions caused by this pandemic has clearly exposed the weaknesses of having fragmented supply chains. This has resulted in hundreds of tonnes of fresh produce being rotten or thrown away. While some farmers in India are forced to sell their fresh vegetables less than ten times the market prices, many others are not even harvesting with a fear of no buyers. Under the current supply chain set up the supply and demand centres are spread far apart around the globe. With restrictions on the movement of people, commodities and services owing to containment measures, the flow of commodities have been getting impacted adversely. Having greater visibility, traceability, security and interoperability within food supply chains are need of the time. It is imperative to build connected, ultra-agile and more resilient food supply chains now and beyond COVID-19. This can be achieved by configuring digitally connected and ultra-agile food supply chains that could rapidly adjust to uncertain market disruptions such as this.
Managing risk: supply chain actors no longer have limited exposure to their tier 1 suppliers, manufactures and distributors. Within the food supply chains, the connectedness between various actors responsible for farming, harvesting, processing, packaging, transporting, storing, and selling of a food product are growing. Disruptions in one node has potential to adversely impact another. In a time like this, managing supply chain risk has no substitute. While availability of food is not a problem, supplying it to the needful has become a challenging task due to containment measures in place. Therefore, this is a time to redefine risk management strategies for an uninterrupted food supply chain. It is required to have greater visibility with in the supply chain to manage risk efficiently. And, organisations can design data-driven supply chains leveraging on advanced technologies such as internet of things (IoTs), blockchain, big data, machine learning, thermal engineering and space sciences, which can withstand fast changing conditions.
Business Continuity & Industry X.O: food supply chains currently are experiencing unprecedented challenges to their business continuity. Supply chain functions across the food industry are greatly disrupted by this pandemic crisis. Many business-critical services are unable to fulfil the demand due to unavailability of labour as well as social distancing measures. That has led to many food supply chains not being able to adapt to this sudden change of demand, seasonal harvesting time, logistical challenges and workforce productivity. To address business continuity and supply chain resilience, supply chain actors are required to consider operational restructuring and rapid innovation. While use of digital technologies for value creation in a data-driven supply chain helps, according to a leading management consultancy farm Accenture, “Creating value with digital technologies isn’t just a simple game of mixing and matching digital technologies. Businesses also need to completely reinvent their operating models, production and value chains, becoming what Accenture calls Industry X.0 businesses” to withstand a crisis such as this.
Systems Approach: It is a time to have more integrated approach towards the food systems. We have an exemplary view of connectedness within the global supply chains during this pandemic that reinforces our belief in the systems approach. Food security of one country or one region in the world can no more be taken a granted if disruptions are happening in the parts of the globe. No single country can be shielded from food insecurities that are a result of disruptions in another. The view of stand-alone supply chains are needed to be replaced with connectedness within the global food supply chain. Exclusive policies for farmers, processors, retailers, and consumers may require reconsideration to formulate a unified policy safeguarding interests of each and every stakeholder within a supply chain. As one component of a global food supply chain impacts another, understanding and executing food supply chains as a system is a potential way forward in this direction.
Project TRANSSITioN: Under the current lockdown and mandatory social distancing advisory, the physical distancing makes us value our social connections more than ever. This gives us an extraordinary moment to realise and to celebrate the power of mutual dependence and connectedness. In a time like this, a STFC-GCRF funded project such as TRANSSITioN bestows ample opportunities to re-examine the loose ends within the agri-food supply chain in a country such as India, which is a vital part of the global food systems. While working with farmers and farmer producer organisations directly, the project immensely benefits from leading space and data scientists from the Science and Technology Facilities Council (STFC) – one of the research councils in the UK – and other academic researchers to develop solutions using advanced STFC technologies and space sciences. The project TRANSSITioN reinforces hope amongst many for an efficient agri-food cold supply chain at a time of uncertainty because of COVID-19.
By Rakesh Nayak – Program Manager, Project TRANSSITioN
Photo credit – John Vandore