Supply chain execs share disaster-planning techniques
Lessons of New Orleans continue to resonate
Network World - Without warning, a supply chain executive from Wal-Mart Stores Inc. told his operations and administrative staff to pretend that a particular distribution facility had burned to the ground. They had until the end of the day to figure out how to service Wal-Mart's stores without depending on the impaired facility or its displaced staff.
Such training exercises help Wal-Mart make sure its supply chain operations stay flexible, said Gary Maxwell, a senior vice president in the Bentonville, Ark., company's replenishment division. Maxwell took part in a panel of supply chain experts at the Retail Systems show held in Chicago last month.
Coping with supply chain disruptions is a challenge for many companies, said Andrew White, a research director at Gartner Inc. and moderator of the panel. As retailers and manufacturers continue to trim the fat from supply operations and more closely tie investments to demand, it becomes harder to maintain a resilient supply chain. "When you become so lean, the supply chain is very fragile," White said.
IT systems can help. For example, RFID technology can make staff more aware of events and conditions in the supply chain, White said. The ability to collaborate with trading partners also is a key discipline.
Learning from Katrina
For Procter & Gamble, a well-tuned business continuity plan was critical to recovering after Hurricane Katrina swept through the Gulf Coast region last August and left the company's Folgers coffee-making facilities submerged. "It took our entire production facility off-line," said Jake Barr, an associate director of supply network operations at P&G.
The company's first priority was its workers. Locating staff was a huge job, Barr said. To help its displaced workers, P&G set up Gentilly Village, a temporary housing facility on the Folgers plant site that accommodates 500 families and is still in use today.
Meanwhile, available P&G employees and contractors took steps to repair and restart the Folgers plant and manage retailers' coffee supply -- when Katrina hit, it affected 40% of coffee consumption in North America, Barr said.
Despite all the hurdles, P&G managed to reopen its Folgers plant on Sept. 19, just three weeks after Hurricane Katrina hit. By Sept. 23, P&G had resumed more than 85% of its coffee production using third-party sources and alternate P&G sites. By November the company had its coffee production and roasting facilities running at full capacity.
Having detailed, up-to-date contingency plans allowed P&G to bring its plant back online quickly, Barr said. There was no time to make plans with the hurricane swirling offshore, they had to already be in place, he said.
P&G's plans included a freshwater source and secondary suppliers for items such as packing materials. The company also had design images and digital photos of every part of its operations. In the weeks leading up to Hurricane Katrina, P&G had refreshed its disaster recovery plans, which it does on a regular basis so the data stays current, Barr said.
- Silicon Valley's 19 Coolest Places to Work
- Is Windows 8 Development Worth the Trouble?
- 8 Books Every IT Leader Should Read This Year
- 10 Hot Hadoop Startups to Watch
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- ERP in the Cloud and the Modern Business View IDC's White Paper, to review IDC CloudTrack Survey findings, gain expert insight into the challenges and opportunities the cloud presents, and determine...
- Oracle ERP Cloud Service - Back-Office Solutions that Keep You in Front Learn how you can harness the power of the cloud to run your business more effectively and lower upfront costs.
- Integration with Oracle Fusion Financials Cloud Service While moving your financial system to the cloud may seem straightforward, truly realizing the advantages of the cloud requires a complete understanding how...
- Oracle Fusion Financials Cloud Service Modern organizations are under intense pressure to provide accurate, reliable, and speedy financial information to business decision-makers. Furthermore, complying with global standards has...
- Top 4 Digital Signage Fails Join RMG Networks for a look at four of the most common reasons digital signage fails in corporate businesses. Learn about strategies to...
- Building Tomorrow's Infrastructure Listen to this podcast to discover how Crider Foods worked with PC Connection to update their IT infrastructure, while maintaining compliance and control. All ERP White Papers | Webcasts