It takes a lot of ingredients to make a business run smoothly and efficiently. Unfortunately, few businesses can make this claim today. Credit is tight to non-existent. Clients are focusing on survival at almost any cost. Relationships are strained, with no improvement in sight. Each of these leads to a general lack of visibility, the secret sauce to running a profitable business.
Now everyone is running scared. Orders are slashed and released to their venders at the last second. Oftentimes with unrealistic expectations and demands attached to them. Bankers are cutting lines of credit, oftentimes without notice. This is quickly evolving into a world where previous rules no longer apply, and new standards are being put into place. Often with little or no consideration to those it impacts. Every action and reaction across the supply chain is further reducing Visibility.
My concern, this is another one of those Without Warning scenarios. Short-term thinkers are making long-term plays. During more normal times when similar situations emerged, many companies could simply fire their customer, client or supplier. However today, businesses are fighting to retain whatever business they can, and firing a customer isn’t plausible. This allows an imbalance in the system to emerge and sustain itself.
The quickest means of exiting this recession is if everyone were to restrain from extreme acts and a healthy dose of civility emerged. Helping improve Visibility in the supply chain will help all. If we don’t, an old Swahili saying might apply, “When elephants fight, it’s the grass that suffers.”
Tags: Leadership, Uncategorized
