Leading in Times of Crisis

I have always wondered what it would be like to manage a Supply Chain where you had infinite resources and where no disruptions happened at all. Then I realize that if this were the case, what would the point be of having a supply chain team; we might as well be replaced by smart algorithms that would ensure the balance between supply and demand, and I come back to reality. Yes, reality, where we have storms and all sorts of natural disasters, commodity price volatility, labor shortages, political and economic instability, and lately, pandemics. All these scenarios, and I’m pretty sure there are many more, are what make a flexible and resilient supply chain team indispensable.

None of us were expecting or even prepared for the disruption that COVID-19 brought. Companies were forced to change their strategies on the fly, with no time to sit down and think. Suddenly, our sales operating plans were 40 percent less than expected. Inventories, transportation plans, manufacturing plans, among others, needed to be adjusted to the new reality. Teams could no longer gather around a table to make important decisions. People were uncertain about what was going to happen.

In my experience, two factors have been key to successfully facing all challenges. First and most important, the team. It is in these situations that leaders need to show temperance and strength but, most importantly, they must show that they are there for their people. When leaders value their teams, they make them part of the solution and they trust and empower them. When people feel trusted and that they can trust their leaders, they feel safe, a sense of belonging arises and productivity increases, not because it is their job and they must do it, but because they want to and they feel fulfilled. They can project themselves into the future and see that when the company advances, they advance.

I remember March 2020 very well. We were closing the hiring process of our new warehousing and distribution supervisor when the emergency was declared. The candidate had just quit her job and immediately called, anxiously asking: “Will I still be hired?” We had chosen her over a more experienced candidate, something about empathetic connection. Her first three months of onboarding process had to be virtual, with literally no visits to the distribution center (DC). I had to take her under my wing and guide her through this process. I never saw her frustrated; on the other hand her willingness to learn and her attitude were one of a kind, and her learning curve was impressively fast. Finally, we received corporate approval for her to go three times a week to the DC.

Today, two years after her arrival, she has overcome two COVID waves that left her operation 60 percent short-staffed and a three-month national strike where the entrances (air and land) to the main cities were blocked with minimal impact only to hospitals and patients. She is considered one of the best WH&D supervisors in Latin America and she has one of the highest rankings in the region. All it took to boost her potential was trust. Like her, we have many examples of high-potential collaborators who after being empowered have made enormous contributions to the company and have boosted their careers.

The second factor is knowing your priorities and aligning them with the team. By knowing your priorities, I mean, knowing and understanding business goals and how they align with each function. Business goals are not a thing of senior managers, they are something that concerns every single function in the organization: if everyone on your team has a clear understanding of how their work impacts the results of the company, they will own the result, they work for it and walk the extra mile.

Developing business acumen in your people, regardless of their level, will create a sense of understanding that will give them tools and empower them. A time might come when tradeoffs will need to be made and you will have to give up the results of your area, days of inventory, for instance, to accomplish a bigger business goal. This might come as an unpopular decision but when everyone is aligned and knows that the overall results will be achieved, despite a deviation in their area’s result, the team will gladly make the trade-off.

I’ve seen this one too many times. Once, early in Q2, the team received an early warning of a major blockade resulting from a nationwide strike. This could not only compromise the overall company results but also our ability to deliver lifesaving products. Field stocks had to be doubled and transportation costs skyrocketed. Action needed to be taken immediately. In the end, the impact was minimized and revenue, gross margin and operating income were achieved. During the most part of the year, the team had to work to put the area’s results back on track. By year-end, the numbers were achieved.

These are just two examples of what an engaged, highly motivated team can do. It is our job as leaders, no matter the circumstances, to put our people first, to trust and empower them and to always be on the frontline with them.