The Retrofitting of an Existing Supply Chain in Response to COVID-19

Supply Chain Management (SCM), which appeared in the early 1990s, has recently raised much interest since the declaration of COVID-19 as an outbreak by the World Health Organization (WHO). The opportunity of integrated management of the supply chain (SC) can reduce the propagation of unexpected/undesirable events through the network and can affect the well-being of all members decisively. Supply chain management seeks to integrate a plant with suppliers and customers to be managed as a whole. The coordination of input/output flows (materials, information and finances) so that products are produced and distributed in the right quantities, to the right locations, at the right time is the end goal.

The main objective is to achieve suitable economic results together with meeting the desired demand levels of goods [food and medicines]. The design of a new SC, the retrofitting of an existing SC, or the planning of the operation of the chain to meet ever-changing market conditions is a large-scale dynamic decision challenge.

At the operational level, SCM addresses the multisite scheduling under uncertainty of a supply chain comprising several plants, warehouses and retailers, and including also the transport of materials between the various nodes embedded in the network. The operational strategies are generally deterministic with targets set by the S&OP. Deterministic strategies consider all model parameters, such as cost coefficients, production rates, demand, and so on, as being known. These assumptions are not realistic and relevant in the presence of uncertainties due to COVID-19, where supplies and intermodal transportation is far more uncertain than demand. So, all companies must re-plan operational targets with high responsiveness on compromised efficiency.

It is suggested that incorporating demand uncertainty into planning decisions with small horizons would be appropriate. Efficiency should be compromised with agility, to meet customer demand in a COVID outbreak.

Presented By,

Azhar Qadri


The opinions expressed in this article are those of the author.

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