Strong Supply Chains Through Resilient Operations

Future-proof your firm’s supply chains with a renewed focus on resilience

In Strong Supply Chains Through Resilient Operations: Five Principles for Leaders to Win in a Volatile World, a team of dedicated, veteran operations strategists delivers a practical and hands-on discussion of how to future-proof your company’s supply chains through a relentless focus on resilience. In the book, you’ll discover how to shift your firm’s emphasis from “low-cost” to “low volatility” as you protect your company against the supply and demand shocks associated pandemics, wars, labor disputes, and trade conflicts.

You’ll also learn about:

• Real-world examples of companies realizing long-term competitive advantage by implementing the shifts advocated by the authors
• Why seeking to build mutually beneficial, long-term relationships with dependable suppliers is preferable to always choosing the cheapest option
• How a renewed focus on diversity and new ways of working can create resilient operations teams that pass on value to your customers

An effective and essential discussion of one of the most prominent challenges facing contemporary companies around the world, Strong Supply Chains Through Resilient Operations is a need-to-read book for managers, executives, business leaders, entrepreneurs, operations and supply chain professionals, and anyone else with a stake in the smooth operation of their firm.

Preface: Building Strong Supply Chains to Profit Despite Disruptions ix

Part I Five Principles to Transform Your Operations Strategy 1

Chapter 1 Strong Operations Drive Growth and Profits by Adjusting to an Ever-Changing World 3

Chapter 2 Principle 1: Build Resilience Against Supply Shocks by Empowering Your Supply Base 17

Chapter 3 Principle 2: Build Resilience Against Demand Shocks by Using Your Operations to Create Customer Value 29

Chapter 4 Principle 3: Create Resilient Teams by Leaning into New Ways of Working and the Benefits of Diversity 43

Chapter 5 Principle 4: Enable Resilience Through Technology by Combining Human Judgment with Artificial Intelligence

Chapter 6 Principle 5: Ensure Long-Term Resilience by Embracing Sustainability 69

Chapter 7 Fit the Principles to Your Situation and Strategy 85

Part II From Strategy To Action: Implementing the Five Principles 91

Chapter 8 Build Resilience Against Supply Shocks by Working with Supplier Ecosystems 93

Chapter 9 Build Resilience Against Demand Shocks by Operating for the Customer 107

Chapter 10 Create Resilient Teams by Combining Expertise into Economies of Skill 125

Chapter 11 Combine Human and Artificial Intelligence to Build Resilience Through Constant Learning 137

Chapter 12 Ensure Long-Term Resilience by Embracing Sustainability 153

Part III Outlook: Using Resilience Principles to Adapt to Future Scenarios 169

Chapter 13 Potential Scenarios of the Future Economy 171

Chapter 14 Industry Case Studies on How the Principles Can Help in Future Scenarios 181

Chapter 15 Common Themes We See in All Transformations 195

Chapter 16 Some Questions to Ask Yourself About the Future of Your Operations 197

Notes 201

Acknowledgments 219

About Us 223

About the Authors 227

Index 231

SUKETU GANDHI is a Global Co-Lead of Kearney Strategic Operations. He’s a recognized industry leader and subject matter expert on a wide range of operations and digital topics, including end-to-end supply chains.

MICHAEL F. STROHMER is a Global Co-Lead of Kearney Strategic Operations. He’s an internationally recognized expert in strategic end-to-end operations, procurement transformations, and sustainability.

MARC LAKNER is Kearney’s Managing Director for Germany, Austria, and Switzerland. Marc is an expert in digital manufacturing, Industry 4.0, supply chain management, and innovative cost-reduction initiatives.

TIFFANY HICKERSON is a Partner in Kearney’s Strategic Operations practice. As one of Kearney’s leading operations experts, she helps clients execute large-scale operations transformations focusing on a range of topics, including rapid cost savings, organizational redesign, and capability building.

SHERRI HE is the Managing Director of Kearney’s Greater China Unit and leads the Consumer and Retail practice in Kearney Greater China. She is an expert in strategy, digital transformation, e-commerce, new retail, sales and marketing, operations improvement, and more.

Business leaders around the world are finding themselves in the midst of the greatest transformation in operations since World War II. Companies are adjusting to a new, post-pandemic reality in which supply chains optimized exclusively around cost are failing in the face of disruption, labor shortages, wars, and other crises. How can firms adjust to a new world in which VUCA—volatile, uncertain, complex, and ambiguous—is more than just a buzzy acronym?

In Strong Supply Chains Through Resilient Operations: 5 Principles for Leaders to Win in a Volatile World, a team of dedicated, veteran operations experts delivers an incisive and hands-on discussion of solutions to widespread supply chain problems. The authors focus on the concept of resilience, broadly defined, and how it can lend your firm a permanent and significant competitive advantage.

You’ll discover how empowering your supply base, protecting against demand shocks, generating new ways of working, combining AI with human judgment, and embracing sustainability can put your company miles ahead of the competition. You’ll also learn how to combine these strategies with one another to achieve exponentially improved operational results.

Strong Supply Chains Through Resilient Operations includes dozens of real-world examples of industry leaders implementing the kinds of shifts discussed by the authors, and the tremendous benefits they’ve realized in the process. It also offers practical, on-the-ground changes you can make today to implement the ideas discussed within.

An essential and exciting new take on age-old operations problems that have assumed a new urgency as the world has become a more complicated place, this book will prove invaluable to managers, executives, operations and supply chain professionals, and anyone else with an interest in the smooth and efficient running of their organization.

Praise for STRONG SUPPLY CHAINS

“Analytics and AI, among other technologies, can help businesses build a more agile and resilient supply chain. This book provides insight into how businesses can combine technology and other operational improvements to achieve meaningful change and growth.”
—Pallaw Sharma, Chief Data and Analytics Officer, Cisco

“The heart of every supply chain is people. Empowering them and jointly building purpose can build competitive advantage through resilience, as this book entertainingly shows.”
—Harald Emberger, CSCO, Beiersdorf

“Embedded resilience and agility in the supply chain are foundations for future success for many businesses. They also become a competitive edge. This book provides rich content on the how!”
—Dirk Holbach, CSCO, Henkel

“An inspiring and practical vision for more resilient supply chains—and full of examples of how companies are already transforming to achieve long-term success in a volatile world. This is in particular helpful for companies developing from a fast-growing company to an A+ company. Strongly recommend.”
—Frank Wang, CSO, Master Kong

“Full of innovative, practical, and grounded approaches to supply chain management, this book provides a valuable resource for businesses seeking to build a more resilient and responsible supply chain.”
—Dietmar Tanzer, CEO, Sony DADC

“If you’re ready to take your supply chain to the next level, this book is your guide. The authors provide actionable strategies for transformation, and the real-world examples show how to successfully navigate the journey to resilience and growth.”
—Cord Prinzhorn, Chairman of the Supervisory Board, Lenzing AG and Semperit AG