Procurement management resilience
Procurement management resilience remains critical to most nations and organizations’ recovery. Effective procurement management ensures quality over control, higher efficiency, faster production cycle, reduced production costs, better service, customer relationship, and an overall improvement in a company’s financial performance. The entry of COVID 19 pandemic into the world and the subsequent impact and implications have adversely impacted households, businesses, and the economy. Notably, distributors and manufacturers have found it difficult to replenish or replace their machinery or equipment and inventory due to global procurement disruption. The pandemic has forced industries to adopt strategies to ensure they continue running operations and combating the pandemic without making significant losses. Similarly, some industries have reaped significant benefits from the pandemic as demand for certain goods has continued to grow tremendously. Therefore, this paper compares the overall summary of selected research articles on the impact of COVID 19 on procurement, the comparative scenario of impact on two industries, and impact on the procurement on one item.
Comparative Overall SummaryCorona virus pandemic continues disrupting numerous supply chains on a global scale. As a result, procurement leaders and other business executives must fulfill urgent demands, maintain operations, and mitigate supplier challenges, especially against a backdrop of disruption to their people, teams, and their local communities. Given the uncertainty of times, one notable thematic response for organizations and other business institutions have been the immediate reduction in risk appetite. Companies have opted to take fewer risk approaches due to the unpredictable moments, which affected procurement across the globe. For example, these approaches have been demonstrated through the shutdown of strategic projects, laying off of workers, as well as rapid implementation of enterprise continuity plans. According to Uğur and Akbiyik (2020, n. p), companies have placed their balance sheet in a better place in order to ride out the pandemic’s impact in the increasingly globalized world. According to recent studies, the pandemic has affected procurement management in different industries, making it difficult for these industries to normally conduct business operations. Instead, the industries have been forced to adopt strategies to ensure they continue running operations and combating the pandemic without making significant losses. On the other hand, some industries have benefitted through the pandemic as demand for certain goods has continued growing tremendously.
- Two Industry Comparative
- Food Industry
According to Hobbs (2020, n. p), COVID 19 has affected procurement management in the food industry’s supply chain. The author notes the resilience of the food supply chain has been the main point of focus in the time of crisis. As such, food industries have been forced to adjust rapidly in order to meet the demand-side shocks, such as changes in food purchasing patterns and panic buying. Besides, they have been forced to adjust due to potential disruptions to supply and transportation networks and labor shortage. In the article, the author discusses how pandemic has affected the food industries in many nations, particularly Canada. In the short run, the pandemic has disrupted labor supply, triggering a shortage, and caused a panic buy. In the long run, it has caused long-term changes in the food industry. For example, there has been an expansion of online grocery deliveries.
- Retail Industry
Following the wake of the COVID 19 pandemic, retail industries experienced abnormal consumption of some goods, such as hoarding of toilet papers. According to Laato, Islam, Farooq, and Dhir (2020, n. p), consumers started behaving abnormally when fear of market disruptions started circulating. As a result, consumer and retail services suffered in several ways, including empty shelves due to initial rush for specific items and surplus creation for other goods. According to the authors, the pandemic’s early stages postulate that supply shocks and exogenous demand will make the procurement vulnerable to short-run and prolonged run disruptions.
- Impact of COVID 19 on the Procurement
As discussed above, retail industries experienced abnormal consumption of some goods such as hoarding of toilet papers. Consumers bought large quantities of toilet papers in the fear that the stock would be depleted due to demand. Secondly, the consumers anticipated that the growing demand would increase toilet papers and other related commodities (Seetharaman, 2020, n. p). As a result, supermarkets and other retailers suffered empty shelves. Besides, the pandemic had adverse effects on the demand for different products. As a result, retail industries have placed their balance sheet in a better place in order to ride out the pandemic’s impact in the increasingly globalized world.
- Conclusion
In conclusion, procurement management resilience remains critical to most nations’ and organizations’ recovery. The COVID 19 pandemics have affected several industries, including food and retailing industries. Food industries have been forced to adjust rapidly in order to meet the demand-side shocks, such as changes in food purchasing patterns and panic buying. Similarly, retail industries experienced abnormal consumption of some goods such as hoarding of toilet papers. Companies have opted to take fewer risk approaches due to the unpredictable moments, which affected procurement across the globe. These risks include shutting down strategic projects, laying off workers, and rapid implementation of enterprise continuity plans.