Alumni insight: supply chains – stopping the links from breaking
Rob Johnson, Honorary Professor; Former Director of Supply Chains, Jaguar Land Rover (Geography, 1979)
Demand and supply shocks from Covid-19 hit supply almost everywhere we look, from foodstuffs, energy, manufactured goods, raw materials, medicines and even semiconductors.
Production shutdowns and cutbacks starved supply chains over many months, and later when opening up to restore output, there were big problems in labour, sub supply, raw material, and logistics. Many sectors are still below pre-pandemic output, and since then we have also seen huge energy cost spikes and shortages as a side effect of the war in Ukraine.
What does this mean for future global value chains given the obvious need now for more resilience and reduced risk? Are we going to see the demise of ‘Just in Time’ (JIT) and rapid transit logistics in shipping, air, and road freight? In my view no, supply chains are not about to drop JIT, which brings too many important benefits in quality and manpower efficiency. However, we are going to see much more ‘built in’ real time supplier monitoring, responsiveness, and agility.
Reactivity will help ‘see’ supply issues instantly, and upstream manufacturing can focus on both rapid adaption and an agile changeover to updated build capabilities, including digitally signalling to wholly integrated supplier operations.
‘We get the supply chains we deserve’, as my old boss Shuhei Toyoda of Toyota once said to me. What he meant is we can never, ever stop looking to improve how supply chains operate.
Check out Rob in conversation with Richard Fresia-Farrelly, Chief Operating Officer, DS Group in the business school's 'In conversation with...' video.