Posted on 11/13/2005 8:05:37 AM PST by John Jorsett
The hurricanes that flattened the Gulf Coast in August and September tested corporate logistics and supply chain operations, as companies struggled to move relief supplies and inventory to and from the region before and after each storm. One lesson from these storms is that having procedures for communicating quickly about what needs to be done is as essential for companies as having integrated inventory and logistics systems.
"Resilient companies communicate obsessively," says Yossi Sheffi, director of the MIT Center for Transportation and Logistics.
Wal-Mart, for example, was able to move food, water, generators and other goods to areas hit by hurricanes Katrina and Rita following each storm because it has an emergency operations center that is staffed every day around the clock by decision-makers who have access to all of the company's systems.
Under normal circumstances, a six- to 10-person staff at the center responds to everyday emergencies, such as a fire in a store or a shooting outside one. When disasters such as hurricanes threaten, the staff is joined by senior representatives from each of the company's functional areas, says Jason Jackson, Wal-Mart's director of business continuity. The center is equipped with hurricane-tracking software, and on Aug. 24, days before Katrina made landfall, company managers were already planning their response.
The emergency response team works in a large, open room that is designed with efficient communication in mind. When a district manager calls from the field to tell the operations manager in the center that he needs 10 trucks of water, the operations manager can turn to the person manning the replenishment systems.
The replenishment manager then checks his supplies. "He says, 'I can get you eight [trucks] today and two tomorrow,'" says Jackson. "He then tells the logistics guy. This all takes place in a matter of seconds."
As a result, Wal-Mart trucks were distributing aid to Katrina's victims days before federal relief arrived. During a less destructive hurricane, Wal-Mart ships between 200 and 400 containers of goods for sale or relief. In the first two and a half weeks following Katrina, Wal-Mart shipped 2,500 containers to the region and delivered another 517 containers post-Rita. Wal-Mart also set up satellite links for its stores that lost phone or Internet service so that they could stay connected to headquarters; Wal-Mart stores in areas that were without power for weeks were able to keep generators in stock.
Starbucks was also able to get aid to hurricane-ravaged areas quickly. When the company got a request from the American Red Cross to donate coffee, managers at headquarters contacted the company's distributors to discuss how they could help. Starbucks determined that it could donate 30,000 pounds of coffee, 235,000 bottles of water and 44,000 pastries without affecting supplies to its retail stores. Efficient communication also helped many companies avoid losing goods in the storm. MIT's Sheffi notes that GM was able to contact its dealers in New Orleans about moving their inventory out of the city and then sent car carriers to pick up the vehicles.
Sheffi says the long-term implications of this year's hurricanes will be that companies will now pay more attention to building redundancy and flexibility into their logistics operations. Companies that can communicate quickly are well positioned to weather any storm.
You will find it in the paint section of Wal-Mart. There are three places in Wal-Mart where there is tape and this is the only section with that particular tape. Do not get the "Permanent" type. It must say "Removable" on the packaging.
"Yeah, I wonder if it took a 18 month $1 billion research and planning commitee for these companies to deduce the most effective method for dealing with the logistical problems of dealing with disasters that effect their business?"
I'm betting three meetings over lunch at Hooters.
I will remember that. And believe me, I am VERY familiar with the paint department at WalMart!!!
The only saving grace there is self-checkout. Otherwise I'd probably be still standing there in line.
I bought the entire inventory of this tape in the stores in Hudson NH, Chelmsford MA, Tewksbury MA, Hudson MA, and Salem, NH.
What exactly are you up to???
You are not keeping up with the tape industry. The duck corporation bought out the duct tape division of Loctite corp, and renamed the entire line "DUCK TAPE". It is true, now anytime you use the phrase "DUCK TAPE", you are using a brand name.
The home of Champion Trailers.
Awesome! You are a great American!
You're amazing!!!!
Lesson: FEMA should have contracted Wal-Mart to get supplies into the region. Then let Guardsmen move the goods from the nearest Wal-Mart to the front lines.
No huge surprise here. Wal-Mart trounces competitors almost entirely because of the efficiency of its "just in time" supply chain. They don't keep a lot of inventory in warehouses, and they don't let the shelves go empty. They balance shipments from one place to another so their truckers rarely have deadhead runs.
Got it in one. It would be incredibly expensive for FEMA to set up an entirely separate chain of communication and warehouses "just for emergency situations", which is the likely government response. But that is undoubtedly exactly what the Democrats will suggest.
Hey, I'm not going to miss the boat on this one... I just bought the last 2371 rolls of duct tape here in Vegas. I'm finally going to get rich!
What? Six to 10 people staff? They're kidding, right? Gotta be... Or, or, or, we're paying "Homeland Security" / CIA / State Emergency Teams, etc., waaaaaaaay too much money for staffing. No bang for our buck. Colossal waste of money. Zip protection for many dollars...
So what we do is we cover every common room in white lights from floor to ceiling. I run lights all around the baseboard, the windows, doorways and then along the ceilings. We then put mult-colored lights in the bedrooms and bathrooms.
It is such light that from Thanksgiving to Super Bowl Sunday (the weekend that I take them all down), that you don't need to turn on a single overhead light or lamp in the house. This helps offset the electricity bill.
It also enables us to spread out the Christmas season and it gets us through the darkest days of the year in good cheer. No light deprivation depression in this household!
"...because it has an emergency operations center that is staffed every day around the clock by decision-makers who have access to all of the company's systems. "
FEMA has basically the same thing. I've seen their EOC in Atlanta. Very impressive. The biggest difference to Walmart is that FEMA doesn't have any control of the distribution process. They must rely on outside sources which greatly vary in dependability. They can request resources, but they have no way to control the response. This is why the military does so much better than FEMA. The military, like Walmart, control their own resources and the distribution of them.
Catholic Charities do a great job. Many of our Episcopal priests sought out priests who lost their churches and many if not most members lost their homes.
Our priest has been working with a priest in coastal Alabama. His church was destroyed to the foundation and most of the members of his church lost their homes. We have raised about 25k for this priest to use to help his members.
We are starting to send gift cards from Home Depot, Lowes, Walmart and Target for Thanksgiving, the Holidays and whatever. We get the gift cards and drop them off at our church office. They are then mailed to the priest (we are renting a trailer for him as his church office). Then he distributes the cards to his parish members as needed.
Up to now we have sent blankets, clothes and other items along with the cash. A volunteer nurse, not from our area, worked in this town and with this priest. Last Sunday she
visited our church to personally thank us for what we have done.
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