fastlane
the seven deadly sins of
supply chain crisis management
“A crisis unmasks everyone.”
—Mason Cooley
IT’S OFFICIAL: ON DEC. 1, 2008, THE NATIONAL
Bureau of Economic Research confirmed what most
supply chain managers already knew or suspected—
the U.S. economy has been in recession since
December 2007. Although they may not have known
precisely when the recession began, supply chain managers, like their counterparts throughout the corporation, have been all too aware of deteriorating business
conditions in recent months and the challenges they
have presented. Certainly, many companies, service
providers and users alike, are feeling the pain.
That does not mean all is lost, however. As Friedrich
Nietzsche said, “That which does not destroy us
makes us stronger.”
As we prepare to navigate new courses in these challenging times, I suggest we endeavor to avoid what I
call the seven deadly sins of supply chain crisis management. (These are not to be confused with the original seven deadly sins—lust, gluttony, greed, sloth,
wrath, envy, and pride—although I suspect a case
could be made for at least two or three of these.) What
follows is a rundown of those supply chain crisis
management sins:
1. Fear. The first emotion many of us feel in times
like these is fear—fear of losing our jobs, our 401(k)
funds, our credibility. While it would be naïve not to
be concerned, fear can be a very destructive emotion.
We don’t work well when we’re afraid. In the final
analysis, most of us will survive this turmoil, and we
must try to push the fear aside and channel our energies toward problem solving.
2. Panic. Panic usually follows on the heels of fear,
and now is not the time to make drastic and sudden
changes in carriers and other types of service
providers, or in distribution networks. Planning
should be substituted for panic. Move deliberately
and cautiously. These are volatile times. What is true
today may not be so tomorrow.
3. Short-term thinking. There will be a temptation to
make decisions based on quick fixes and immediate
savings. This can be particularly true with technology.
We have spent years developing information systems
in the supply chain industry, some of which are not
inexpensive. There may be a temptation to say,
“Forget information is power; show me the money.”
But this course of action will not serve you well over
the long term.
4. Greed. Now is not the
time to take advantage of
carriers and other service
providers that are burdened
with excess capacity. It is in
our best interests for our
logistics providers to stay
healthy and remain available to provide the
resources and choices that
we all need to do our jobs
effectively.
5. Hostility. When we get
stressed, we sometimes treat
our supply chain partners poorly. Negotiations can
quickly turn adversarial or hostile. Even though we
may not agree on courses of action, we will be more
successful over the long run if we treat our partners
with sensitivity and courtesy.
6. Dishonesty. Hopefully, this requires no explanation. But be aware that adversity can bring out the
worst in people. Don’t be tempted to relax your standards of moral and ethical behavior.
7. Complacency. Finally, the worst option you can
choose is to do nothing. While we shouldn’t panic,
neither should we sit idly by and expect everything to
work out in the end. Whether in good times or times
of crisis, the supply chain managers who succeed will
be those who are proactive, thoughtful, and unafraid
to make bold, but well-planned, moves.
Clifford F. Lynch is executive vice president of CTSI, a supply chain solutions firm, and author
of Logistics Outsourcing – A Management Guide. He can be reached at cliffl@ctsi-global.com.
