COVID Truths or Myths: IACCM Survey results regarding supply chain disruption, what CPOs may be missing that can cost them big time, and where’s the “meat”?

Posted on April 20, 2020


Every Monday morning, I invite you to share your opinion regarding some of the more exciting and thought-provoking stories from the past week on how the COVID-19 pandemic is impacting procurement and supply chains.

The purpose of this exercise isn’t to merely “shoot the breeze.” The whole idea is to stimulate meaningful discussion about the changes that are certain to happen because of COVID-19.

Everything from the emergence of the remote procurement professional and governments controlling supply chains to the growing belief in protectionism will be covered.

When it comes to the future of procurement and supply chains, nothing is off the table at this point, so feel free to let loose!

Flattening the SC Disruption Curve

Last week I had the opportunity to catch-up with IACCM’s Tim Cummins and Paula Doyle.

While it was the first time that I had the opportunity to talk with Paula, Tim and I have had many interesting and enlightening discussions over the many years we have known each other. Our most recent conversation was no exception.

According to a series of surveys starting in early March, the disruptive impact of the COVID-19 crisis is steadily increasing.

On March 6th, 27 percent of respondents reported that their supply chain had experienced disruption as a result of the pandemic. In a second survey, a couple of weeks later, that number grew to 60 percent. With the third and most recent survey, 78 percent reported disruption.

Besides the obvious question; how many of you are surprised at the level of disruption – which you can answer by taking the above 10-second poll, perhaps the more significant issue on which we should focus is how to flatten the disruption curve?

A Watchful Eye

While there is no shortage of challenges with which CPOs are now dealing, there are several that should be a priority. Besides the obvious one regarding supply chain disruption (see above), there are three that we have identified that will not only address current issues but set the stage for addressing near-future ones as we emerge from the pandemic’s shadow.

Here they are:

  •  Recognizing that they are currently underutilizing their existing technology
  •  Dealing with employee isolation resulting from remote working (IACCM reports that “64% of Procurement staff, contract managers, in-house lawyers” have serious concerns regarding “their career and job prospects.”)
  •  Moving beyond an anecdotal acknowledgement of the importance of good supplier relations and taking meaningful action to build a better rapport throughout their supply chains.

A Meat Shortage?

The meat industry says it faces a looming crisis if COVID-19 cases continue to disrupt work at slaughterhouses, warning that a sustained backlog of live animals on farms could lead to financial trouble for farmers and shortages at the grocery store. – The Globe and Mail (April 16th, 2020)

According to news reports, the number of slaughterhouse employees who have tested positive for the coronavirus is on the rise. It threatens to sever a critical link between farms and your local grocery store.

You may have already read the stories and seen pictures of the significant wastage of produce and eggs due to processing plant slowdowns or shutdowns. Does a similar fate await the meat industry?

Produce, and eggs have a definite “shelf-life” warranting disposal. With livestock, an adjustment in diet from a “higher-energy growth diet that typically precedes slaughter,” to a “forage-heavy maintenance diet” addresses the question of spoilage. However, such measures do not address the issue of meeting consumer demand?

For the moment, there appears to be no imminent threat of supply being unable to meet demand. That said, such scenarios once again demonstrate how a chain is only as strong as its weakest link.

A Final Note

Just a reminder to take the CPO Strategy – Sourcing Solved Survey: Assessing the impact of the COVID-19 pandemic on the procurement professional.

Once all the responses are collected, I will be writing a white paper on the results with plans to publish sometime in the next quarter.

Here is THE LINK (it is an excellent investment of 2-minutes of your time).

Posted in: Commentary, COVID-19