Lifting our focus from the fog of confusion to develop a viable road map
At a time when European businesses are just beginning to grapple with the extraordinary pressures of precipitous sales falls and delivery strains, it is hard to argue that looking ahead strategically is more critical than ever. Surely the current fog of confusion demands focus on today’s delivery problems and not next month’s recovery plan? However, it is evident from discussions with senior supply chain managers that consideration of actions for both time horizons are valid, indeed essential to climb out of the crisis and ensure a more resilient logistics sector in the future.
During F&L’s latest discussion we heard how current conditions are creating shifts in transport choices which could be long-lasting, and from Italy where supply chain leaders are developing templates to help the logistics sector move forward – they have already begun planning for a staged exit from the crisis, considering relaunching “hibernating” assets and repositioning them to meet demand. We also noted that, while before the crisis managing customer demand volatility was tricky, now it’s become a key concern for logistics managers.
Whilst overall demand has fallen there is a greater use of rail with manufacturers seeking access to an intermodal solution. A shortage of truck drivers and local driver restrictions have made a different blend of road and rail, as well as inland waterways, a more viable option. In addition a dramatic fall in rail passenger demand has eased track availability which temporarily eases this transition.
The Italian logistics sector has pulled together a broad spectrum of stakeholders from across the industry to analyse how they can build greater resilience in the supply chain in a number of sectors including the grocery trade. Recent events have highlighted weaknesses in delivery chains which may have been brushed over in better times and now require change, which is only achievable through collaborative action.
Finally, there is an acceptance that in the heat of the crisis with day-to-day pressures it is easy to lose sight of longer-term objectives. Short term cash constraints will mean “sustainability” equates to survival for many, but the consensus was that the debate around environmental sustainability, CO2 reduction and innovation are still essential and a key part of the future.
Our next Friday Focus will be on 17th April – join the F&L discussion for more news from the supply chain front-line.
Philip Evans, F&L Secretary General
Massimo Marciani, President Freight Leaders’ Council (Italy)