I've written about how supply chains got exposed by the pandemic. It's not exactly an original idea - and to be honest, it's not very interesting at this point. What is interesting?
How did companies respond under pressurized circumstances?
There is another equally important question:
Did the transformations underway help - and will they help going forward?
At NRF's virtual Big Show, Chapter 1, Infor customers Burton Snowboards and Ariat International shared how they've navigated the pandemic. I nabbed a one-on-one version of the story with Rachel Grogan-Cook, Director of Global Supply Chain at Burton Snowboards.
Burton Snowboards' supply chain gets the COVID-19 stress test
First off, Burton is a lot more than snowboards. Even a quick look at the Burton Snowboards web site shows you that. Burton Snowboards clearly has a lifestyle vibe, not just snowboard equipment (they have much niftier jackets on their home page than anything I currently own). Sourcing for all those products? Yes, that's Grogan-Cook's team. As she told me:
I oversee our global supply chain - all of the products that Burton Snowboards makes. We're manufacturing heavily in Asia - Southeast Asia specifically - Austria, and Peru... Our supply chain supports manufacturing snowboards, which is a very specialized skill set, all the way to cut-and-sew jackets, socks, gloves and headwear.
Then COVID-19 hit - and Grogan-Cook's team landed in the proverbial hot seat. She continues:
When COVID first hit last January, we saw the biggest interruption in our raw material supply chain, as well as our finished goods supply chain within China. At that point, we were just worried about getting raw goods because a lot of our raw materials come from China. The areas where those raw goods were coming from were completely shut down.
As COVID-19 spread, so did the supply chain disruption:
What started in that January/February timeframe as a true supply chain issue obviously morphed into a much broader supply chain and economic issue as well.
Grogan-Cook's team found itself in crisis mode:
As we progressed through March and into April, we started to see shutdowns and closures reach beyond China. We started to see Bangladesh shut down, and we started to see Vietnam shut down.
Now, raw materials weren't the only issue:
As it transitioned from a raw material problem, it certainly escalated into an entire finished goods supply chain problem. We then became concerned about the boards that we manufacture in Austria, and then our more basic apparel that we make down south in Peru. It came in waves, and compounded the fear of what that was going to look like when we rounded the corner in July, August and September.
Consumer demand complicated the issue. Demand for some Burton Snowboards products rebounded quickly, and eventually surged, while other products took a hit. Snowboards, obviously, are largely dependent on venues such as ski resorts. Grogan-Cook:
Our businesses - specifically all of the resorts - shut down. So all the ski resorts lost significant amounts of revenue. The wave of order cancellations followed that, as the Coronavirus made its way across the globe. So what was a supply chain issue very quickly became a market issue.
Leaning on your supply chain tools - a gut check for Infor Nexus
Burton Snowboard's use of Nexus dates back to 2003. Over the years, they expanded their use of the Infor Nexus platform. Prior to the pandemic, automation was already a goal:
A couple years ago, we worked with Nexus to automate what was a very manual process for us: prior to onboarding WIP - so work in process. We used to get 65 Excel templates every single week, from every one of our suppliers.
Then we used to have a team of people that would take those milestone dates, and key them into our MRP system. We had eight people that just did that. They would key that information in so that we could have a delivery outlook.
That changed a few years ago:
When we decided to go down the road of implementing the Infor Nexus WIP tool, all of that became automated.
It wasn't just automation; it was better data visibility.
It used to take us about seven days to get visibility into that data, which would have been crippling amid COVID.
And did that visibility help when the situation was dire?
For soft goods specifically, we were able to use that information to understand what soft goods products they had not cut yet. So we were able to basically stop production on those types of goods, and then figure out an alternative plan for those rolls of uncut fabric we could use at a later date. And obviously, you need to be able to make decisions quite quickly when you're in a crisis moment. That WIP tool is invaluable.
Grogan-Cook didn't sugar coat it: her team was stressed. Yes, they were able to use Infor Nexus remotely - and they all pulled together. But it was not an easy time for the geographically-dispersed group, which included two women in China.
We have a very tight team... It was mainly the five of us digging through all of that information, and understanding where we were at in production, where we could reduce without cutting off the nose of the business - and using the tools that we had at our disposal to do that. I think that speaks to some of the efficiency of the tools specifically that we're using.
That's how you find out what your supply chain team is made of:
We all know that inventory can kill an organization... It was a very stressful period of time for understanding or identifying: how much to cut? And is it too much? Or is it not enough? You feel like the world is like burning down around it from a supply chain perspective... It was a wave of emotions last winter and spring, that's for sure.
Now that we're arrived in 2021, how does Grogan-Cook grade their efforts?
We did really well. We actually landed in a very comfortable inventory position. One of our strategies was to take a risk on carry-over inventory - inventory that will continue to have value into future seasons. And we reduced more heavily on single-season inventory. And our single-season inventory year-over-year is better coming out of COVID than it was the prior year. So the strategy certainly worked.
It was a very intense trial by fire. Like I said, we have a really good team that is really strategic, and really intentional. We're all very, very logic-driven. So we left it in a really good place.
The wrap - do supply chains need to change?
Does Grogan-Cook view this as a supply chain transformation? I couldn't help but notice she didn't use that specific "t" word. Her answer?
I think we're going through - we'll go through - a supply chain transformation. But I think in tandem with the supply chain transformation is the sales channel transformation. That's what's going to specifically feed our supply chain transformation.
Right now, for example, we typically develop product two years out from when it shows up. As a retailer, we're aiming to be more like 12 months. So it's going to change the way we think about how we come up with our product lines.
Is her company is re-evaluating suppliers based on the upheavals? We've seen considerable debate about whether supply chains will regionalize - or will companies build in redundant suppliers. Grogan-Cook told me they aren't thinking along those lines, but: she did say her existing suppliers went through a revealing stress test. There could well be changes based on how particular suppliers did. Another issue that could force change: capacity in a shorter timeframe. Consumer demand via sales channel shifts could provoke that.
So how does Infor fit into all this? Are they a technology provider, or is it a deeper partnership? As Grogan-Cook told me:
There is very much an ongoing dialogue. Holly and I have a regular dialogue (editor's note: Holly Lipscomb is the Infor Account Manager for Burton Snowboards. She focuses on supply chain management solutions for Burton). That is one of the things that keeps this relationship as strong as it is. We have really strong partnerships internally. Infor Nexus speaks our language; they understand our business; they understand our pain points, and they help us identify solutions that bring value. While we go through those conversations, they're always able to relate it back to the problems that Burton is facing.
Yep - it's not just technology that gets tested; it's partnerships. I'm sure there are more curveballs for Burton Snowboards ahead, but this is my kind of story.