Building transportation supply chain resilience after a pandemic
As the global supply chain looks for ways to continue “business as usual,” it’s preparing to be on the road again. With all respect to Willie Nelson, this also means at sea, in the air, on the rails, and everywhere else transportation happens. The transportation industry is relying on the knowledge gained from past freight supply chain disruptions and documented by TRB in order to successfully handle COVID-19 and its aftermath.
TRB’s April 8 webinar on this topic addressed the major changes in freight flows and the challenges in delivering products to companies and consumers, particularly regarding both medical supplies and food delivery. Attendees saw the spectrum of disruption and an example of evolving supply chains, particularly with New Jersey in the aftermath of Hurricane Sandy. Presenters also covered impact models based on geography, industry, and mode of transportation as well as the near-term outlook and developments.
When examining freight supply chain resilience, two main issues come to mind. TRB research shows that agencies view resilience in only one of two frames. They may see resilience as either part of incident response or they may see it as part of systems performance. Both public agencies and major transportation firms have plans in place and operational strategies for resilience as part of incident response only. The disruption caused by COVID-19 will require plans for responding to both incidents and system performance issues and TRB can help.
TRB offers a comprehensive and practicable five-step process to evaluate a wide range of freight network disruptions and their potential economic impacts. Assessing economic effects must account for the nature of the methodologies in addition to the characteristics of a specific disruption. Modeling must examine social and public sector costs in addition to direct costs.
Business continuity requires companies to protect their business from risks. With the global pandemic, risks shift between their employees’ health to the limited availability of resources as industries react to shifting quarantines across the world. From a system resiliency perspective, it is important to understand each supply stakeholder’s priorities before, during, and after a disruption.
An applied model highlighted in Transportation Research Record show that a dual-route distribution strategy can be more advantageous than a traditional system in which companies just move from a single regional distribution center to a different regional distribution center in the case of a supply chain disruption. Using this strategy at all times could minimize the direct and indirect costs incurred during a disruption, despite the cause of the disruption.
Infrastructure, logistics, finances, communication, regulations, and institutional components all play a role in making a supply chain more resilient. Effective interagency and intergroup communication was identified as being the most important input into effective resiliency strategies. In the case of natural disaster disruption, communications tools often do not work as planned. The second of the seven steps recommended for mitigating supply chain disruptions is communication. As many employees have shifted to working remotely or with a pared down staff, clear communication remains important.
U.S. ports are part of intermodal freight systems that are both vulnerable to security and safety concerns, and economically necessary. The goal after a natural or manmade event is to bring a seaport’s freight movement system back to its prior operating level after going one of two ways. Ports have post-incident plans either to handle a lack of cargo due to delays or systems to handle a surplus of cargo. The uncertainty of COVID-19 means that ports may have to frequently shift between these situations as response to the virus shifts globally. Research in TRB’s Transportation Research Record explores a quantitative measure of resilience to determine the best set of actions to improve security at facilities within an intermodal network.
A National Academies report exploring supply chain disruption in the aftermath of specific hurricanes found that the resilience of a supply chain depends on the affect specifically on bottlenecks and lead times more than any other part of the chain. Resilience is also determined by the capabilities that exist for eventual and swift restoration. The disruptions from a hurricane are quite different from an ongoing pandemic, however the importance of robust, adaptable supply chains has proven valuable in both cases.
TRB has a number of resources on the COVID-19 pandemic‘s effects on transportation. Likewise, a pending National Highway Cooperative Research Program (NCHR) project will explore transportation network resiliency. Coordinating management and long-term planning for designated corridors of significance is also an area of exploration.
National Academies and TRB resources cited in this article:
Additional National Academies and TRB resources:
By
Beth Ewoldsen/Transportation Research Board, April 8
This Summary Last Modified On: 7/30/2020