Business continuity planning proved crucial: Nestlé supply chain chief

The past two years have forced supply chain leaders to encounter the most challenging circumstances, perhaps ever, and revealed the role of supply chains as drivers of business value, not simply cost centres.

Digital Nation spoke with Maria Clara Esguerra, the head of supply for Nestlé in Oceania, about how the pandemic has changed the perception of the supply chain at Nestlé — considered one of the ten best managed supply chains in the world by industry researchers Gartner.

“I think one of the biggest changes will be the material sourcing strategy, we have to be more dynamic and find different alternatives to do all the material sourcing,” said Clara Esguerra.

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Thomas O’Connor, senior director and analyst at Gartner, believes that the industry needs a restructure to adapt to the new challenges that its facing.

“We've seen supply chains needing to rethink how they're structured, how they're operating,” says O’Connor.

“This idea around resilience and agility has certainly come to the fore. And we've seen a number of organisations needing to rethink how they're currently structured.”

Another disruptive change facing the industry is the recognition and utilisation of automation.
Clara Esguerra says that difficulties in forecasting this change can make integration into business practices tough for many companies.

Moreover, the pandemic forced many companies to refocus on business continuity planning amidst this disruption.

“One of the biggest changes is, because we were just in time, before we didn't have so much stock. We react and we increase the stock, but it's not so easy to say “I increased it”, because we have to store it, and we have to move it,” says Clara Esguerra.

“So we had to create a lot of business continuity plans (BCP). Now, to understand BCP plans, every time that we have [an instance such as COVID], we say “Ok, what is the BCP plan? How much stock do we need? How many locations do we need to add? How much transport do we need to add? How the factories can produce?” So that was one of the biggest impacts that we had.”