How Will Supply Chains Bounce Back From All The 2021 Shipping Delays?
Supply chains have not had it easy in the past few years. With shifting consumer habits driven by a new “norm” in regard to shopping, alongside many other issues, supply chains have been stretched to their limits.
Luckily, experts predict that we will finally make a significant improvement in the delays and supply chain issues we are experiencing by middle to late 2022. Of course, we still have a long way to go. But there are many predictions and potential interventions being proposed by experts in the transportation and supply chain industries that can help us finally move past the issues that affected the world throughout 2020-2021.
Let’s take a look at some of the solutions and proposals that could help us move toward a brighter future with regard to supply chains.
Last week, transportation industry leaders met in Nashville, Tennessee to discuss shipping issues and solutions. One of the themes that came out of this meeting was the pressing need for Congress to pass the infrastructure bill that had been hotly debated for months.
America’s roads span millions of miles. And nearly half of these roads are considered to be in “mediocre” or “poor” condition. The same goes for the country’s bridges, many of which are considered to be structurally inadequate for our current transportation needs.
The infrastructure bill in question (which passed on November 5th) will provide billions of dollars of funding for improving these roadways.
Building More Resilient Supply Chains
Recently, the Summit on Global Supply Chain Resilience convened to address the issues of clogged ports and slowdowns in shipping.
A few of the plans which the Biden administration outlined during this summit include:
- 24/7 operating hours on the United States’ west coast ports,
- An Early Warning System to alert supply chains and businesses of probable disruptions in operations.
These steps may take some time to be fully realized. However, these efforts should help supply chains in both the short term and long term by building resilience and overcoming some of the current bottlenecks in the system.
As with any new development in business and supply chains today: technology is the future. Through the use of the best available apps and tech, supply chains will be better able to increase visibility throughout the entirety of the process. This will lead to the improved ability to triage situations and avoid potentially troublesome development throughout the supply chain.
Perhaps most importantly of all, having increased visibility will allow everyone involved in the process to see where goods are at any given time so that changes can be made in real-time. Preventing future delays before they happen will be critical moving forward.
While scenario planning is not necessarily an immediate fix to the issues at hand, it is important for the long-term needs of supply chains.
However, by practicing scenario planning with uncertainty in mind, supply chains can at least have a better shot at overcoming large-scale future issues. Taking the time to respond to hypothetical scenarios will be a huge help in the long term and may mitigate some of the delays and backups that will arise with any future scenarios that come up a few months from now or a few years from now.
Moving Toward Regional Supply Chains
As much as possible, global supply chains need to move toward more regional models. Not only will this shift lead to a lower environmental impact, but it will also improve relationships and will effectively overcome many of the supply chain issues such as delays and logjams due to inter and cross-country shipping.
Furthermore, this will make it easier to overcome any future travel or shipping restrictions, which have made shipping across borders a virtual nightmare.
Easing Tensions With China
Tension with suppliers and trade partners in China has continued to rise over the past few years. Since much of the materials used in production, such as semiconductors, are produced in China, a continually escalating trade war is not ideal for supply chain recovery.
While there may be little supply chain professionals themselves can do to overcome this cross-country tension, it is important that the governments of both countries find common ground and develop solutions to bridge the gap that is causing continued delays and material shortages.
Moving toward more regional supply chains is important (as discussed in the previous point), but we will still be an interconnected world to some degree no matter what.
There’s no telling what may happen in the future, but there are some promising signs. With the recent passing of the infrastructure bill along with some short-term and long-term supply chain solutions; mid-to-late 2022 is a target date that is being widely accepted for a return to normal.
Perhaps this will be a “new normal”, with different standards and operations. But hopefully by next year we will finally be close to closing the chapter on the difficult time that was the years 2020-2021.