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Our sister publication, Supply Chain Quarterly (SCQ), published an interesting list in the last issue.  It’s the “’Top 10 Supply Chain Risks of 2019.”  There are serious supply chain risks out there.  Some of them link directly to logistics operations. 

A thread in the SCQ risks involve uncertainties that just a few years ago were not top of mind in distribution centers.  These risks involve government oversight and management of logistics.  Both are pulling distribution managers into new directions.

Logistics managers in the United States are agile at managing international movements.  Unfortunately, the choreography of those moves is shifting.  According to the article in the SCQ, “Companies face the immediate risk of increased cost and customs agents are adapting to new processes.”

We’re talking tariffs.

It’s hard to be agile when shackled by evolving costs outside of the logistician’s control.  Agile distribution means we anticipate as best as we can, but new variables introduced by the federal government without enough runway cause disruption. 

Improvisation – the development and deployment of new processes, no matter how agile you are - implies risk, always. 

We’re in an era of improvisation.

These risks emerging across the international dimension for logistics managers are now driving issues.  Just what are the rules going to be for Mexico?  How will Brexit impact movements to and from Europe?  How and when will the situation stabilize with China?

Risk managers deliver stability.  The government isn’t helping.

All of these “international” issues roll uncertainty into warehouse and distribution operations.  Is there enough space to hold increased buffer inventories?  As inbound and outbound flows evolve – perhaps rapidly – are transportation contracts in place to handle it?  Are customs brokers actively managing the backlogs at the ports as industry – not just your company – scramble to react to moves out of the White House? 

Supply Chain Risk Management is now an issue on the distribution center, not just the corporate offices.