What is causing supply chain issues

By - Randy
01.21.22 01:31 PM
What is causing supply chain issues


In this video, I will break down the causes of the supply chain issues we are hearing about in a way we can all understand.

Currently, there is not a day that goes by that we don't hear about supply chain issues in the media.

You may be experiencing issues in your personal supply chain due to shortages in things you want to buy for Christmas.
Plus, rising prices causing all of us to beware of the supply chain.

So, to understand what's going on, we need to understand a few things about what drives the supply chain and the factors that affect the supply chain.

Before the pandemic, many of us took for granted that whenever we wanted something, we could go to the store or go online to make a purchase and instantly have what we need.

Then the pandemic hit and the first shortage we noticed was toilet paper ;-).
Now we are seeing shortages in not only retail stuff, but also basic living needs such as food and fuel.
These shortages are causing prices to go up and forcing us to make hard choices.

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You may not realize it, but you have supply chain management experience as well. You manage a supply chain everyday by making sure your home has the things it needs to operate. You take inventory of what you have, identify requirements that need to be filled, take action to fill your needs by doing market research, contacting vendors, negotiating, purchasing, moving things home (we call that logistics) and storing the items until you need them.

Folks, that's supply chain management.

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So, let's break down the drivers of the supply chain.

There's only three…

  1. Customer Focus
  2. Information Technology
  3. Environmental Uncertainty

Customer focus is the only reason to create a supply chain.

You need to build something that delivers the right stuff in the right place at the right time in the right quantity at the right quality

You are the customer for vendors like #amazon and #walmart.

Your family is the customer of your supply chain.

Information technology is how we collect the information we need to make decisions.

For you it's your debit card or credit card statement that tells you what you're buying.

Also, the grocery list, and of course your Christmas List, tells you want you need to buy for your customers.

Companies use more sophisticated technology like #SAP, #Oracle, or #Vendorful to collect information about inventory, place orders, and track the supply chain.

Lastly, environmental uncertainty where people don't know what's available or what to expect.

The fundamentals of supply and demand kicks in where customers create demand and supply drives up prices.

Uncertainty exists at all levels of the supply chain from the customer to the extraction of raw materials like oil.
The pandemic affected the ability of labor to pull out raw materials, manufacture finished goods, and deliver goods to customers.

  • What are we uncertain about?
  • What’s available?
  • When will it be available?
  • Who has it?
  • Where is it?
  • Why is it or is it not available?
  • How to get it?
  • So, what do we do about it???

Start checking your information.

A research technique is triangulation where you get at least three different sources of information about a topic and see the common thread between them. Considering the abundance of information and the bias of information across all mediums, you should consider at least three if not more.

With information, you can make better decisions about priorities and where to send your money in your supply chain.

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The purpose of SupplyChainManagement.Jobs is to be the premiere resource for professionals in the supply chain management community. Here you will find employment opportunities from companies seeking to hire supply chain management professionals. Plus, you will have access to resources to make you more competitive for employment opportunities in the supply chain industry. Resources for people will include how to get hired, skills training, freelance opportunities, and executive recruitment for the supply chain management community. You will be part of a community of supply chain management professionals where you can post your professional resume, exchange ideas, discuss issues, and engage in conversations.