Katrina's Impact: Supply Chains Need To Adapt

Watching supply chains react to the tragedy of Katrina, the role of planning became crystal clear. Some of the larger retail companies were able to deliver emergency supplies at a quicker pace than the federal government. And the planning extended to make sure that stores had the necessary items to help in the clean-up phase. Communications, healthcare, logistics and consumer goods companies all quickly rose to the occasion and used processes in place to move goods to where they were needed. Disaster relief programs become operational and were successful.

In analyzing the next six months in terms of supply chain capabilities, AMR Research's Lora Cecere predicts that supply chain executives will use "advanced planning and scheduling and sourcing technologies to prevent shortages and better service customers."

She suggests some ways that companies can strengthen their supply chains;

• More On Hurricane Katrina See IndustryWeek's Hurricane Katrina News & Resources section for more on coverage and how companies are responding.

  Rerun demand plans -- Collaborate with customers to address changes in demand, changes in volume and rework these plans quickly.
• Guarantee supply for key customers -- As shortages incur make sure you have a clear understanding of your priorities and get your customer, service and logistic teams on all the same page.
• Focus on relationships to ensure reliable supply -- When renegotiating to reflect current needs try to avoid direct confrontation as that might result in an unpredictable supply.

To read the report "Katrina's Aftermath: Flexible Supply Chains Are Needed Now More Than Ever" visit http://www.amrresearch.com/Content/view.asp?pmillid=18654