“When written in Chinese, the word crisis is composed of two characters — one represents danger, and the other represents opportunity.” – John F. Kennedy
Limited supplies, extensive layoffs, abnormal demands, salary cuts, delayed shipments, the Great Resignation and sudden fluctuations in the stock market – it’s crazy to think about how the COVID-19 crisis is our reality now. For most companies, these unfortunate events are just the tip of the iceberg of what they have had to deal with as 2020 and 2021 unfolded.
With all of these devastating events happening simultaneously around the globe, businesses – particularly in the logistics area – are striving hard to sustain their operations and meet the demands. No one was fully prepared to face this crisis.
But just as President Kennedy points out, with every crisis comes an opportunity. COVID-19 has given us a masterclass on how companies can better their logistics game in the future.
Since COVID-19 struck the world, it’s also highlighted the areas where companies are lacking in logistics. So what are the logistics lessons we’ve learned so far?
Logistics Lesson #1: Companies That Quickly Adapted to the ‘New Normal’ Are More Likely to Survive
One important lesson that we’ve learned is that companies who were quick to adapt to the “new normal” have been proven to have a better chance of survival than those companies who just waited for the crisis to pass. For example, according to a news report, when the demand for food deliveries spiked in Huntsville, Alabama, restaurant company GrubSouth was quick to take action.
They immediately hired 30 new drivers and added almost 12 new restaurants to their system to meet the higher demand for food deliveries. In compliance with the current pandemic restrictions, GrubSouth also observes a no-contact delivery policy that excludes the cash order option.
Another good example of quick adaptation is UniStar Cleaning Services. Since the demand for cleaning services had increased more than ever before in Manchester, New Hampshire, UniStar made their disinfecting services a cut above the rest to keep up with the increasing demand.
UniStar implemented a color-coding system according to business co-owner, Ryan Van Orden. They also assigned specific protection clothes for specific rooms to avoid contamination.
On top of that, UniStar use new sets of cleaning clothes and sanitize their vacuums with hospital-grade disinfectants for every establishment and house they visit. Now that’s what you call going the extra mile.
Logistics Lesson #2: Transparency Is Key for Earning Stakeholder and Customer Trust
A second logistics lesson that we learned from COVID-19 is that being honest gives companies the power to own the people’s trust. Transparency is the key.
To alleviate a crisis such as COVID-19, it is necessary is to have clear communication with stakeholders and customers. Providing this communication is daunting at times, as you are letting people see a company’s vulnerable side.
But by practicing transparency, you also gain people’s trust. Arne Sorenson, the late CEO of Marriott, courageously and transparently addressed the COVID-19 crisis as it began to occur, despite suffering from cancer. His YouTube video was the first time that he appeared bald in public as a side effect of his cancer treatment, but that did not stop Sorenson from stepping up.
In his heartfelt message, Sorenson admitted, “COVID-19 is having a more severe and sudden impact on our business than 9/11 and the 2009 financial crisis combined.” He also stated that some of their operations are roughly 70% below normal levels, which led Marriott to cut down costs, stop all their hotel initiatives for 2020, and postpone their advertising and marketing campaigns in the meantime.
Sorenson even disclosed the fact that he did not take any salary for the balance of 2020 while his executive team took a 50% cut in pay. In his video, Sorenson not only addressed the real status of his company, but also showed his compassion for the stakeholders whom he addressed as the “very heart” of the company.
Sorenson’s example only goes to show that when you practice transparency, you’re also showing assurance to your stakeholders. This kind of honesty, courage, and humility is what has made Marriott earn people’s trust and support throughout the COVID-19 crisis.
Logistics Lesson #3: Proactively Partnering with Other Businesses Helps Companies to Withstand a Crisis
The third logistics lesson that we learned from COVID-19 is that companies who are proactive in working hand in hand with other companies tend to withstand a crisis more than those who go alone.
During these trying times, gone is the idea of a lonesome hero. Companies who used to work with manual labor forces before the pandemic are now starting to invest in technology by collaborating with tech companies.
Due to the pandemic, companies were forced to pare down their employees into a limited skeletal workforce. While no one knows when normal business operations will go back to how they used to be, adapting to automated systems, machines, robots and other kinds of technology that require minimal manual supervision is the best resort.
Investing in automated systems can be a big help for companies, especially in logistics. Not only will using more technology reduce the required number of employees, but it will also save companies more time and energy.
For instance, logistics software company Magaya offers a LiveTrack system that allows companies to optimize their customer service. This system uses an app that enables their customers to easily access documents and track shipments without bothering other team members with phone calls and emails. Magaya also has the Magaya Cloud, a cloud-based logistics software that lets customers improve their operations without spending more money.
Another good example of collaboration work is Christine Gregoire, CEO of Challenge Seattle, who created an initiative to work together with 21 different leaders in the Pacific Northwest region. This teamwork paved the way for conducting the world’s first operational trial site for a COVID-19 vaccine candidate.
We Are Likely to Learn Future Logistics Lessons from the COVID-19 Pandemic
It may take a while before companies figure out what works the best or what is the most efficient approach to go around the steep learning curve that the COVID-19 pandemic has created. What’s more important is that we need companies to remember the logistics lessons we’ve learned so far. The losses we have already suffered should be enough motivation to raise our game and do the best we can to move forward.
After all, there’s no absolute formula to dodge this crisis, only the lessons we learn. It’s during these times of crises that we are reminded that at the end of the day, everyone is still learning and growing.
About the Author
Dr. Parker currently serves as the Department Chair, Supply Chain Management, Contracting and Acquisition (SCA) within the Dr. Wallace E. Boston School of Business. He serves as an adjunct faculty for various universities around the world. Dr. Parker is a native of Temple, Texas, a certified Inspector General by the Association of Inspector Generals, and a proud member of professional organizations advancing knowledge and professionalism, such as the Association of Supply Chain Management and the National Naval Officers Association.
Dr. Parker is a published author, inspirational speaker, consummate entrepreneur, and consultant who speaks worldwide on diversity, inclusion, and leadership. He holds a Ph.D. in organization and management from Capella University, a MBA from Liberty University, and a B.A. in history from Wittenberg University. Dr. Parker has a long history of passion and interest in local communities and is a proud member of Kappa Alpha Psi Fraternity, Inc. Learn more about Dr. Parker by visiting Dr. Larry D. Parker Jr. Inspires.