Strong Supply Chains Through Resilient Operations

CHAPTER 1Strong Operations Drive Growth and Profits by Adjusting to an Ever‐Changing World

The COVID‐19 pandemic marked the end of an era. Pandemic effects rippled through supply and labor markets, geopolitical tensions mounted, and the climate crisis increasingly took its toll. We are experiencing the biggest remaking of the global economy since the end of World War II. As with other global rewirings, such as the industrial revolution, the unleashing of the internet, and the move to offshoring, the only thing we know for sure about this new business environment is that it will be less stable than the economic conditions of past decades. External conditions keep changing—and firms' operations struggle to keep up. Businesses are realizing that they need to be more flexible. They need resilience.

Resilience Across the Value Chain

Resilience is the ability to recover quickly from difficulties. Yet in a fast‐changing world, you should not recover to some previous state—because the previous state contributed to your disruption in the first place. The world will never go “back to normal.” In the new business reality, there is no normal anymore—only continual disruptions. Thus, businesses need to adapt quickly to any type of difficulty by proactively strengthening all links in the supply chain. To do this, they need a clear operations strategy that combines business, financial, and other strategies. Wider trends are bringing companies back to basics. How do your operations work, ...