Supply-chain management is ever changing, even when it’s business as usual. A natural disaster can expose or emphasize weakness in an organization’s supply chain. Today we are faced with a global pandemic that has brought many companies to their knees. More than ever, organizations need to stabilize and maximize their efforts to mitigate any threats in their own supply chains.
The dynamics of the current COVID-19 situation share similarities to military combat missions, in that the need for effective communication, rapid decision making and redundancy planning are key to keeping any organization agile. The Collaborative Planning Exercise (CPE) is a three-step process that can identify, analyze, and mitigate threats to an organization. It’s an adaptation of a planning tool used by U.S. armed forces that encourages team building and leader development, and keeps an operation well-positioned to react to an uncertain future and a volatile market.
The global supply chain has been forced into a historical state of change which may last for quite some time. Collaborative planning isn’t a new concept, but as we move closer to the uncertain weeks and months ahead, the need for making decisions with limited information grows.
The real strength of this exercise comes from a one-hour brainstorming session with a group that includes staff members who work within the processes, with a skilled facilitator encouraging and steering the conversation. It’s important to note that limiting management or executive-level involvement in this brainstorming session allows staff to address threats that might otherwise be overlooked or discussed.
A brainstorming session with a supply-chain team may consist of five members. Ideally, a facilitator would aim to encourage discussion of two threats, two analyses per threat, and two mitigation strategies per analyses within each respective process step per team member. The goal of a one-hour session and five-member team would be to identify no fewer than 10 direct threats, 20 analyses, and 40 mitigation strategies.
Step 1: Threat Identification. The group will brainstorm and identify anything believed to be a direct threat to the supply chain. The facilitator should encourage quick, responsive answers while recording everything on a dry-erase board. One example might be supplier stability.
Step 2: Threat Analysis. After direct threats are identified, the facilitator will guide the group to assess the possible ways in which each threat can affect the supply chain. Both short- and long-term affects should be considered. An example might include how supplier stability can affect the company’s supply chain in the next six months, next year and next five years.
Step 3: Mitigation Strategies. During this final step, the facilitator will encourage the group to develop mitigation strategies. The facilitator will document these so that they can be provided as deliverables. Examples might be supplier diversification, supply-chain mapping and supplier redundancy.
Remember that the facilitator should encourage at least two to five answers per member for each step, and record all pertinent information along the way.
The facilitator should arrange all the high-level data and information discussed to produce the first deliverable, called the Threat Summary. This document will be copied and distributed to upper management or executive leadership, while keeping an original copy for historical reference.
The facilitator will then review what has been accomplished, detail the identified direct threats, assess the possible effects of each, and create mitigation strategies. Once arranged and organized, the facilitator will provide the second deliverable to upper management or executive leadership, called the Detailed Threat Analysis. This will outline the proposed mitigation steps from the viewpoint of the brainstorming group or team.
The benefits to an organization that employs a CPE can be defined in the quality of analysis from the viewpoint of boots-on-the-ground staff, who perform the work every day. Involving employees whose primary roles are impacted by threats in the supply chain provides valuable insights that are often overlooked at the executive level. This process also lends itself to proactive, solution-based problem-solving, and provides an organization with an increased decision-making timeline from leadership, having supplied the data needed prior to the occurrence of threats.
Organizations can also acquire a newfound level of confidence among the parties involved after identifying direct threats, resulting in clear and concise communication regarding mitigation. This also reduces panic among organizations when conditions bring unexpected change, and provides leadership with numerous mitigation strategies for implementation.
By supporting the use of this one-hour exercise, any company can gain an important and relevant data source for further decision making, leading to improved service to the customer. Prepping your organization to react to the unknown can improve your company’s ability to turn on a dime, while your competitors are left reacting.
In business, time is measured by money. For U.S. forces in combat zones, it can be measured by how many soldiers come home. When forces are in hostile environments, it’s critical that all parties are informed and understand the plan, lessening the panic, uncertainty and fear that come with unforeseen events. Quick decisions are typically made with limited information, and draw on a planning process that identifies and discusses direct threats, thus improving execution time and increasing success rates. The ability to be agile and proactive in direct-threat identification, analysis and mitigation planning allows the military to save lives, and businesses to save money. Now more than ever, organizations need to stabilize and maximize their efforts to mitigate any threats in their supply chains.
Chris Olejnik is a retired U.S. Army senior supply chain manager. Shellie Jacobucci is a manufacturing supply chain analyst.
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