"Disruptions, disasters and disorder - despite the challenges experienced as they unfold, they have a particular value in their potential to instruct future decision-makers". Amanda MacKinnell, NISR Academic in Residence, shares some insights on supply chain resilience by way of her forthcoming series for the National Institute of Strategic Resilience.
The management of global supply chains, and the operations that both drive and are shaped by them, have faced significant challenges in the early 21st century. The disruptions caused by financial challenges, geo climatic events, bushfires, conflicts in the Middle East and significantly for the past year: Ukraine; all pose threats to business continuity and long-term operational stability to all sectors. As COVID-19 shifts into the longer-term endemic form, Resilience is frequently heralded as the key to surviving, reclaiming a normal state, even if it is a “new normal”.
Resilience as a general term, and as a business imperative, has been employed to acknowledge the actions and processes utilised by businesses and organisations to regain an acceptable level of functionality during, or post, the period of disorder. However, faced with successive disturbances wreaking concussive sequences of disruptions, a goal of resilience and actions to recover to an original level of operational status in order to achieve survival may no longer be enough. The world may have moved on, the goal posts shifted and what was best practice is now the inadequate.
These disruptive events, combining to become the VUCA (Volatile, Uncertain, Complex & Ambiguous) environment, are particularly magnified to those who are unable to adjust to changes in demand and supply chains, leading to scarcity, economic pressures and capability gaps. Addressing these issues, and attempting to regain operations, requires leadership, the ability to scan the environment and move forwards. Forwards is important, rather than “returning to normal”, we can seek to innovate and move away from systems that are unequal to tomorrow’s demands.
Disruptions, disasters and disorder - despite the challenges experienced as they unfold, they have a particular value in their potential to instruct future decision-makers if we seize upon the opportunity to consider the opportunities to do more, to seek to thrive, created through times of confusion and disarray. This concept of embracing disorder and finding advantages in regrouping and reorganising to continue to function and deliver, in volatile and uncertain times, aligns with the concept of “Intelligent Failure” as well as that identified by Nassim Nicholas Taleb, of being Antifragile. Antifragile systems transcend resilience, by seeking to emerge from turmoil and disorder strengthened, enhanced and more effective than their previous state. This may be the next stage in optimising operations and supply chains, as the frequency and impact of catastrophic events and the extent of disruption increases.
The Australian Defence Industry sector, wide-ranging as it may be, has often been called upon to deliver and innovate rapidly in times of conflict and emergencies in order to achieve the operational effectiveness required to respond to strategic or emergent threats. The complex supply chains delivering and sustaining key capabilities, whether a warship, fighter aircraft or armoured vehicle, are critical in ensuring the ongoing readiness of the Australian Defence Force (ADF) as well as equipping it with technology that provides superiority against the threat.
That the ADF, like the defence force of any nation, must be ready to respond and overcome an array of threats is axiomatic (as well as the subject of the soon-to-be-released Defence Strategic Review); but to be truly effective: the ability to find gains and benefit in times of disorder, to be Antifragile, is paramount. To be Antifragile would allow us to be more than resilient and transcend the issues likely to confront us tomorrow.