Beirut supply chain disruption

Following the devastating events that occurred in Beirut a couple of weeks ago, there are a number of consequences that need to be considered and overcome. Particularly, with most supply chains now being truly global, any disruption to them , be it the port infrastructure in Beirut, geopolitical tensions elsewhere, Covid-19, or natural disasters that cause significant impacts to any supply chain that lacks agility and resilience.

According to Antony Lovell, VP of Applications at Vuealta, the Port of Beirut is a significant one for the region and its destruction will inevitably have an impact on the local economy in a myriad of ways. One of the main concerns will be disruption to construction and other recovery related materials, especially if the local storage facilities for such materials have also been destroyed.

“Recent events, including and especially the Covid-19 pandemic, have sharpened businesses’ focus on the agility and resilience of supply chains. As companies have sought efficiencies through globalisation, supply chains have transformed beyond recognition and are now truly global. This means that the supply chains for a surprising array of even basic products now rely on goods being able to freely traverse the globe (or at least cross borders) at record speed and efficiency. Any disruption to these flows, be it the port infrastructure in Beirut, geopolitical tensions elsewhere, Covid-19, or natural disasters that cause significant impacts to any supply chain that lacks agility and resilience.

“The Port of Beirut is a significant one for the region and its destruction will inevitably have an impact on the local economy in a myriad of ways. One of the main concerns will be disruption to construction and other recovery related materials, especially if the local storage facilities for such materials have also been destroyed.

“Given businesses cannot plan in advance for such an unexpected humanitarian disaster, we need supply chains that can respond quickly. This agility may be in the form of flexing processes so that operations can resume at any undamaged areas of the port, or potentially diverting ships to the likes of Tripoli and then bringing the goods in from there by truck.

“Having achieved agility, the measure of resilience is defined by how all the links in the supply chain can adapt and respond to the new situation. For instance, let’s assume that it is immediately possible to send containers to Tripoli and truck them to Beirut. Even this requires coordinated planning to implement changes across multiple companies in close to real-time to orchestrate the network so that they can ensure reconstruction materials can be delivered where needed, quickly. It also requires management of the capacity at Tripoli so it does not end up with a backlog of ships waiting to be processed.

“Ultimately this means businesses require network-based capacity planning and maybe the activation of other nearby ports. Any deficiencies in planning agility will reduce the network resilience and at a time of a natural disaster there will be humanitarian consequences.”

 

 

 

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