Join Tariq Farooq, former SVP Global Supply Chain at Sanofi, as he speaks with Matt Spooner, Industry Thought Leader at Kinaxis, about how the COVID pandemic and subsequent shortages have caused boards and executives to re-evaluate the importance of the supply chain. They discuss why the supply chain has risen to the top of the corporate agenda, and why it is now essential not just to think about tradeoffs in terms of cost, cash and service, but also to include resilience and environmental impact in the equation.
Summary points:
Recent supply chain disruptions that have stemmed from the pandemic have changed the way that boards and executive teams look at and consider the supply chain. According to Tariq, many consumer-packaged goods (CPG) companies, as well as high-tech companies are beginning to recognize the important role that the supply chain plays. As a result, C-suite executives are bringing more supply chain topics to the table. (2:00)
The perception of the importance of the supply chain hasn’t grown just among C-suites, but also among the average person as consumers aren’t seeing what they want on shelves. Supply chain disruption has become a challenge across many industries.
Some supply chain leaders insist that resilience is important – but that it must also be cost neutral. Tariq states that, while cost is important at any time, there has never been a higher need for resilience than now. While many organizations were previously cutting down on costs by doing things like mono-sourcing, in an age of disruption, many companies, especially large-scale ones, are forced to multi-source to maintain efficiency. Tariq states, “The challenge really becomes how do you shift from where you have been, where cost efficiency might have been the primary objective to being in a situation which is more balanced as we move ahead. […] I think increasingly what they'll be doing is leveraging some of the efficiencies that come because of digitalization, because of automation, because of all the great talent that's been developed across supply chains and the supply chain networks that they establish to offset some of those incremental risks.” (8:00)
In the past, supply chain professionals were focused on trying to balance the triangle of service, cost and cash. Tariq states that as we move forward, this triangle will look more like a pentagon where you’re trying to balance service, cost, cash, environmental impact and resilience. (8:50)
