Not Virtuous Vectors, but Resilient Systems Ahead

by | May 18, 2020

One of the lessons so far from the pandemic is that governments and the public have become acutely aware of the existence of supply chains and their strategic value for industries and economies. 

When the shelves are empty, it’s cold comfort for consumers to know that one part of the system is performing well.

From medical personal protective equipment to food and toilet paper, consumers and public policy leaders now know that supply chains are vitally important. For essential products and services, resilient supply chains are now elevated to be a matter of national interest.

Of course, this is not new to businesses. They already understand resilient supply chains, because their performance and survival depend on trusted relationships across multiple firms and sectors to reliably serve customers and meet demand.

The situation is different for governments and industry institutions, which tend to align along geographic or sectoral lines. For example, you will often see a government department of agriculture, but not food. Or a farmer advocacy organisation, but not a food value chain representative group. 

Many institutions are not designed to face consumers and the community as a first priority. When they face sectors, it risks a competition between sectors to advocate their interests and blame others when there are problems. 

With food and fibre value chains, people don’t eat cattle, but beef. They bake with flour, not wheat. They wear textile clothing, not bales of wool. 

The challenge is not just to have a world class production or manufacturing sector, but to have world class supply chains. It means adopting a very different way of thinking, with different policies, strategies, structures and relationships. 

The most successful leaders and organisations in the new normal will be placing more emphasis on supply chains and systems, rather than advancing or appeasing sectoral interests. 

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