We’ve been receiving a number of questions from customers asking how to mitigate the impact of COVID-19 (aka coronavirus) on their operations, employees, customers and carriers. The good news is there is a lot that can be done now with your existing logistics and supply chain solutions. You could also quickly take advantage of new ones to be safe and mitigate the financial impact on your business. Here are a few ways you can help “flatten the curve”:
Enable social distancing. The strategy is to change logistics process and technology to allow employees, customers and suppliers to maintain reasonable separation as part of their daily tasks and not come into contact with surfaces that could have been touched by others.
- Move away from “sign on glass”. As part of your proof-of-delivery process (POD), signature capture has become extremely popular, but is counter to social distancing objectives because drivers and customers share the same device. We’ve seen customers remove it as a step; however, if you still need acknowledgement, then our recommendation is to use picture capture of the goods with the person who would have normally signed with a “thumbs up” or even standing next to the goods delivered.
- Go paperless. We know that COVID-19 can last for hours on surfaces and paper is a surface. There’s no need to continue to generate paper receipts and documentation and hand them to customers, drivers and employees. Going paperless has also been proven to reduce operating costs and shorten payment cycles … something important right now as cash is so critical to many companies facing severe disruptions in their business right now.
- Automate check-in and arrival processes. Use real-time GPS-based truck tracking of your fleet and carriers to send arrival notifications to limit the number of times your fleet and commercial carrier drivers have to enter your own facilities or those of your customers’ and suppliers. Frankly, physical notification is an outdated process that can be eliminated because it adds non-value time to the total stop time. Electronic notification also allows the customer to be prepared in advance to receive goods when they arrive, which reduces stop time.
Rebalance the fleet. The pandemic is creating extreme delivery imbalances where some businesses are facing severe shortage of delivery capacity and others are experiencing dramatic slowdown of their business and have excess capacity. For some companies, the challenge is dramatic improvement of productivity and bringing on new capacity and, for others, the challenge is absolute fleet cost minimization. Many of today’s route optimization solutions have the ability to perform strategic modelling scenarios where new delivery policies and practices can be quickly evaluated. If you’ve done a decent job maintaining the data in your route optimization solution, you already have most of the data you need to perform a strategic modelling exercise. Our experience with strategic modelling is that the results can be compelling in terms of increasing productivity and capacity and decreasing cost– much of the time they happen simultaneously. In addition, it can be the fastest way to make a difference as policies and practices can be implemented quickly as opposed to changes in assets and resources.
Reevaluate sourcing. COVID-19 exposed the weaknesses in many companies’ sourcing strategies. Whether it’s finding new supply sources now or looking to mitigate risk for the future, companies want to diversify their supply network. The question we receive is “Where are these new sources?”. There’s a class of global trade intelligence solutions that use shipment data from across the world to model trade flows globally and find new suppliers. These solutions can look beyond anyone’s supply chain to see all of the companies that supply particular commodities that are already shipping into the US or even between other countries. For example, one of the interesting situations we’ve seen in the last two years is the creation of new manufacturing capacity in countries like Vietnam and Thailand as a result of the tariff changes between the US and China. The supply base is not static and, with the increasing sophistication of many economies, it’s operating completely outside of US trade lanes.
Focus on what can be done quickly. Because of the severity of the pandemic and the regulations being put in place by governments, many companies need to pivot their businesses now. Collapsing the time to change is key. Start by looking at what you have today and determine if it can get you most of what you need. “Perfect” is the enemy of “fast” so be prepared to compromise. If you don’t have the right solutions, look for what can get you the furthest the fastest. Traditional IT solution evaluation processes won’t help in this environment. Flexibility and time to results should be the most important measures for procuring the most appropriate solution or services.
Hopefully, the measures that have been or are being put in place will help COVID-19 to run its course quickly. In the meantime, we need to do all we can to keep everyone safe and healthy and keep essential goods flowing while surviving the severely disrupted economy. These are just a few examples and there is much we can do as supply chain and logistics professionals to help. What is your company doing with its processes and technology to mitigate the impact of COVID-19? Let me know.
As Executive Vice President, Marketing and Services, Chris Jones (CJones@descartes.com) is primarily responsible for Descartes marketing activities and implementation of Descartes’ solutions. Chris has over 30 years of experience in the supply chain market, including the last 10 years as a part of the Descartes leadership team. Prior to Descartes, he has held a variety of senior management positions in other organizations including: Senior Vice President at The Aberdeen Group’s Value Chain Research division, Executive Vice President of Marketing and Corporate Development for SynQuest and Vice President and Research Director for Enterprise Resource Planning Solutions at The Gartner Group and Associate Director Operations & Technology for Kraft Foods.