You have designed and implemented a pretty good logistics system and are proud of how effective and efficient your aupply line provides your programmes with any materials they need. Transport and administration cost are now at their minimum, fulfilment rates are close to 100%, and you process and fill almost every order within set timeframes. You feel pretty good about yourself (and not without reason), and are ready to hand over the system to your successor with justifiable pride.
And then the ministry of trade announces that as of tomorrow, clearing rules will be changed, adding three weeks to the current four to five days it takes you to clear your goods. Suddenly things look a lot less optimistic: your carefully balanced and trimmed-down supply chain is strained to the snapping point, and you are looking at having some of your key operations suspended. Even worse: one of those is a treatment programme for TB patients, and suspension of treatment might cause resistance to the drugs involved – making a bad situation suddenly look catastrophic.
What has gone wrong here? Of course, the ministry of trade is partly to blame here: changing rules on a day’s notice is bad governance any time. But a large part of the blame also lies with you: in your push for a lean, mean machine of a supply line, you neglected to take into account your environment and the risks it posed. In short, you built a fragile supply line.
Robustness of supply lines is generally important, but even more so when it comes to global health and aid: a supermarket might take the risk of an empty shelve, but an empty shelve in our case could cost lives. This is an important consideration when you build your risk management plan (which you did of course last year, immediately after reading my post on supply chain risk management): where a supermarket might choose to retain or transfer the risk, we will often have reduce it. Reduction strategies almost inevitably cost money: cost for storage, more expiries, more staff, and many other costs. A well worked-out risk management plan will help you explain why these costs are necessary, and that they do not mean that your supply line is in any way inefficient.
[Image: Crate containing Leg Lamp by J Stewart]