COVID-19 to Supply Lessons on Supply Chain

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Posted on April 27, 2020

Joy Washington

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Lately, when shoppers enter grocery stores many of the shelves are empty, because certain products have limited availability. Dr. Alvin Williams, professor and chair of marketing and quantitative methods in the University of South Alabama’s Mitchell College of Business, shares some professional insight as the COVID-19 health crisis continues.

“Supply chains are integral to every aspect of life. Well-functioning supply chains improve business efficiency and offer higher levels of customer satisfaction,” Williams said. “In ‘normal’ business environments, effective supply chains are lean, agile, and adaptive to the dynamics of the competitive situation. In pandemic mode, supply chains must become even more flexible to accommodate the rapid rate of change.”

Williams provides three priority points about the current supply chain:

• As Consumers: We have witnessed frequent outages of basic products like paper towels, bathroom tissue, and some basic toiletries. Some of this is a function of consumer behavior – panic buying based on the fear of future shortages. In general, some experts say there is about four months of food inventory stored between the manufacturer and grocery stores. Typically, the food supply chain includes the manufacturer, producer, regional distribution center, more local distribution centers, and the local supermarkets, grocery stores. For the time being, under current circumstances, while there may be some hiccups in the food supply chain, sustained shortages are generally not expected. However, the gravity of the current health crisis may precipitate other market behaviors. This is especially the case with increased health issues among workers in the meatpacking industry that may lead to reduced output for some period of time.
• The medical supply chain: This has certainly governed the availability of ventilators, testing equipment, PPEs, etc. While strategic supply chain planning is always a partial antidote in mitigating supply chain risk factors, the magnitude of the current crisis found healthcare supply chains lacking the capacity to manage the onslaught. Medical supply chains, as in others, require some balance between centralization and decentralization of their activities. Centralizing certain purchasing tasks at the federal level would have alleviated some of the pressures at state levels in procuring the necessary medical equipment and supplies. Balancing the dynamics between centralized and decentralized supply systems is not easy, but it requires power and information adjustments all targeted toward customer or patient outcomes.
• The overall supply chain takeaways from this crisis: We cannot plan for all contingencies, we must ensure the maximum degree of supply chain agility that reduce response times and that encourages strategic resource placement, ultimately benefitting the entire system. The current crisis will be more than ample fodder for supply chain case studies by scholars and practitioners regarding what to do or not to do in crisis mode going forward.

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Dr. Alvin Williams is a nationally recognized chair of marketing and quantitative marketing in the University of South Alabama’s Mitchell College of Business. His research interests include business-to-business marketing management, buyer-seller interfaces, supply chain integration, role of trust in supply chain management, application of creative problem-solving to sales and supply success, and application of marketing and sales to supply chain performance. He teaches upper-level courses in supply chain management, business-to-business marketing, sales and sales management, and special topics in marketing, including study abroad courses in Australia, Costa Rica and Panama. Williams earned a doctorate in marketing from the University of Arkansas.

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