RESEARCH SNAPSHOT: Advice to supply chain managers: expect the unexpected
The disasters that hit Japan and Thailand last year have been generally viewed as ‘abnormal’, but such events are actually becoming the norm.
The earthquake and tsunami in Japan and floods in Thailand followed the ash cloud from volcanic disturbance in Iceland the previous year. Before that was Hurricane Katrina in the US.
This year has seen floods in China and the Philippines and huge electricity black-outs in India. All of which highlights the fact that a crisis can hit anywhere at any time.
How to deal with such crises and the importance of having contingency plans are covered in a new report from just-auto.com researched and written by Interchange Europe.
The report also highlights the fragility of the supply chain when disaster strikes and how companies are re-thinking their procurement strategies.
It is impossible to predict what may happen next or where, but as Pitak Pruittisarikorn, head of Honda Thailand says, “you can’t go around trying to avoid the trouble because you would be on the move every year – and the trouble will catch up in the end.” The key is in managing the risk.
GM Thailand’s human resources chief Samnuek Ngamtrakulchol said: “No one was prepared for the flooding and I think that the lesson we take away from this for the future is that contingency plans have to be kept fresh. You can’t put them away in a drawer and think they are done because things change all the time.”
His comments in the report are backed up by GM Thailand president Martin Apfel, who said that the crisis needed “a new management mindset”, looking much further down the supply chain than previously.
The just-auto/Interchange report contains interviews with executives from automotive companies in Thailand who reveal how they handled the disaster, how they got back to normal operations and how they are making contingency plans for the future.
See also: Thailand: a year after the floods