26 April 2010 | Allie Anderson and Nick Martindale
Closure of European airspace because of the volcanic ash cloud should prompt procurement managers to re-evaluate supply chain planning, industry leaders said.
Emma Scott, representation manager at CIPS, said: “Organisations will have to look at how they do things. There’s a big debate at the moment about local or global supply chains and maybe people will look more locally. Organisations must have processes agile enough to change at the last minute, and not put all their eggs in one basket. You need a backup plan in place.”
John Campbell, director of consultancy Food Procurement Services, said: “A lot of supply chains are too dependent on air freight. The speed of the FMCG market in the UK means sea freight and road transport have not been utilised.
“We are now looking at using road transport for short-life goods and different sources in southern Europe rather than the Far East. It’s all about ascertaining the probability and impact of the risk and planning accordingly.”
With thousands of flights grounded across the world, Rick Cudworth, head of resilience and testing at Deloitte, said this kind of disruption should now be part of supply chain planning scenarios. “Airspace lockdown due to volcano eruption is an event that was not in most risk registers, including the UK¹s National Risk Register. The answer is that preparedness, including thorough and regular scenario-based simulations, builds the ability to manage any kind of crisis.”
Supply of categories including perishable foods, flowers, pharmaceutical products and high-tech components were among those disrupted, according to the British International Freight Association.