By Feroza Grosso-Ciponte, Supply Chain Director at Nestlé East and Southern Africa Region (ESAR)
The importance of establishing local supply chains as a business operating in Africa.
Two years in, we still remember ‘toilet paper gate’, when consumers worldwide started panic buying supplies for fear of shortages. This was, we now realise, a normal response to initial supply shocks to industry, and then demand shocks in the consumer landscape as more lockdowns ordered people to stay at home.
Lockdown restrictions meant significant challenges for supply chains around the world, and these worsened when countries closed borders and imposed lockdowns.
Many organisations could not adapt quick enough, and many continue to struggle with adapting to these constant changes. All of this would have had straightforward solutions, but there was more.
As COVID-19 accelerated and magnified problems that already existed across various supply chains for many businesses, one of the problems is a lack of strong local supply chains that would, by design, be resilient to change to address shortages and minimise disruptions in the production process. As we kick off a new year, where have the learning moments for us and our industry been?
People are the heart of the supply chain
When the pandemic loomed, some acted quickly and decisively, with the number one priority being the safety of employees. A range of measures were put in place immediately. These included providing adequate and appropriate Personal Protective Equipment (PPE), free sanitised transport and modified working spaces that were compliant with what was then the ‘new normal.’
All of this happened while we were confronted with a dire business reality in our region – an economic outlook that showed strained growth in southern Africa. For businesses to face the inevitable disruption head-on, we had to be creative and truly think outside the box, while being agile to ensure overall business resilience.
Many leaders look after a diversity of talent, from different cultures, with different ways of thinking and experiences too. Supply chains can be strengthened by having a mix of employees that have been with you for several years, carrying incredible institutional and industry knowledge, and younger talent bringing in new ways of working, both which are complementary to any business.
These talented individuals can also come from on-the-job training programmes such as graduate programmes, internships, learnerships, skills advancement, mentorship, and coaching. These programmes are necessary for creating employment and fostering employability to develop a dynamic and agile workforce.
People from your talent pool and partner network are crucial to maintaining a solid foundation necessary for a robust supply chain that can pivot and conceptualise and implement outside the box thinking to deliver during times of crisis.
As COVID-19 has asked us all to think differently and deliver solutions that were innovative and outside of the box, the centrality of these amazing individuals in the supply value chain cannot be overemphasised.
Future-proofing your supply chain network
Embracing sustainability across supply chains is good for business, the planet, and communities. While in the short term this requires investment, in the long run, it reduces costs and positions businesses for a future where sustainable practices will be non-negotiable. There are many sustainability factors to consider, such as packaging, energy consumption, and local sourcing, which are seismic shifts and have a considerable impact on the bottom line.
Beyond cost-cutting imperatives, sustainability shifts like recyclable and reusable packaging are importantly beneficial to the environment. Rethinking, reducing, and repurposing in this area will mean efficient packaging production, which means fewer energy demands, fewer raw materials, less waste, and many other advantages.
In the short term, sustainability will be an on-cost as we transition to sustainable packaging. However, in the long run, it will positively impact business and help us to achieve net-zero greenhouse gas emissions by 2050.
The shift towards local sustainable sourcing means knowing where and how raw materials needed in food production are made. Developing local supply chains also empowers the communities that businesses operate in and serve. Some considerations include co-developing local solutions with communities, procuring services and materials from local businesses which are usually small to medium scale enterprises, and leveraging market insight, innovation, and best practices from partners.
Building long-term partnerships with key supply partners is one of the most effective ways we can maximise win-win opportunities to deliver to the end consumer in the most cost-efficient way with minimal impact on pricing.
In conclusion, innovation of processes and inclusion of people across the entire supply chain, from staff to entrepreneurs to communities, with a strong consideration for the environment, will better prepare businesses to manage whatever comes next — turning potential disruptions into meaningful opportunities. Regardless of the era, these two fundamentals make a difference between businesses that can survive shocks like COVID-19 presented, and many other incidents that do not form part of expected day to day scenarios.