An article on changing Supply chain management in response to COVID-19. My article has the following sections- 1) The current situation 2) Improvements over the months 3) An ideal Supply Chain Management System 4) Measures to fight back 5) Macroeconomic Implications 6) Footnote

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Redefining Supply Chains to respond to global catastrophes
The current situation
COVID-19 has pretty much made the majority of the world sit inside its homes for the last 12-
13 months resulting in a massive disruption in major industries like Tourism, Retail, Aviation,
Hospitality, Realty, to name a few. Historically, every time there has been a global catastrophe,
Supply Chains have taken a massive hit. It is, therefore, high time that businesses come together
to Reorganize, Redefine, and Redesign supply chains globally.
This article tries to touch upon the important points that need to be followed in order to establish
supply chain management systems that are responsive to not only global threats but local as
well. In addition, it also talks about the perfect Supply Chain Management System, and the
measures to Reorganize, Redefine, and Redesign the supply chains in the current context and
finally ends with the broad Macroeconomic Implications because of the virus.
It is noteworthy to understand that all global catastrophes share similar effects on the supply
chain management system in the sense that it either disrupts and disables the entire supply
chain or slows it down enough, leading to difficulties in demand and production matching.
Improvements over the months
This section strives to showcase the improvements in metrics like mortality rates, recovery
rates and currently infected rates in a span of 9 months between countries like USA, India,
Brazil as well globally.

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Image Source- https://www.worldometers.info/coronavirus/
According to images above, the following statistics can be reported for the global pandemic
wreaking havoc on all possible areas of our lives-
[Data is taken as of 8:45 PM, IST, on 21st of August, 2020]

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Globally-
 Mortality Rate- 3.48%
 Recovery Rate- 67.95%
 Currently Infected Rate- 28.57%
USA-
 Mortality Rate- 3.09%
 Recovery Rate- 53.80%
 Currently Infected Rate- 43.11%
Brazil-
 Mortality Rate- 3.20%
 Recovery Rate- 75.69%
 Currently Infected Rate- 21.09%
India-
 Mortality Rate- 1.89%
 Recovery Rate- 74.37%
 Currently Infected Rate- 25.63%
Although it seems that India is performing better than its counterparts, as India only accounts
for 12.77% of the global cases, has a lower mortality rate and higher recovery rate than the rest
of the world. India’s currently infected rate is also lower than the rest of the world.
However, despite the data showing the fact that India is in good shape, it has managed to climb
up the ranks in being one of the worst hit countries of the world. This is primarily because of a
multitude of factors-
i) An ever-increasing population
ii) The growing disparity between the rich and the poor
iii) A failing public healthcare system
iv) Poor Public and Private transportation system
v) Government laws pertaining to healthcare, resource management, sensitization of
people

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Image Source- https://www.worldometers.info/coronavirus/

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According to images above, the following statistics can be reported for the global pandemic
wreaking havoc on all possible areas of our lives-
[Data is taken as of 21:10 PM, IST, on 26th of April, 2020]
Globally-
 Mortality Rate- 2.11%
 Recovery Rate- 84.82%
 Currently Infected Rate- 13.06%
USA-
 Mortality Rate- 1.79%
 Recovery Rate- 77.32%
 Currently Infected Rate- 20.90%
Brazil-
 Mortality Rate- 2.73%
 Recovery Rate- 89.31%
 Currently Infected Rate- 7.95%
India-
 Mortality Rate- 1.12%
 Recovery Rate- 82.58%
 Currently Infected Rate- 16.29%
Some pointers to elaborate upon-
 Globally, every metric from Mortality Rate, Recovered Rate to Currently Infected Rate
has improved over the months
 There have been remarkable improvements in the currently infected rate for all the three
countries mentioned here. As the currently infected rates reduce, hospitals will begin to
free up again and will have free beds for utilization other than COVID-19. USA has
managed to half the amount while Brazil and India have managed to improve further
 India still leading majorly in the recovery rate and sector; however, the recovery rate
has been impacted with the second wave of oncoming infections

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An ideal Supply Chain Management System
To understand the importance of Supply Chain Management, it is worthwhile to analyse
a Supply and Demand graph. It is common knowledge that the intersection of the demand
and supply curves point out the equilibrium price of a product and the optimum quantity
supplied. From a supplier’s point of view, it is always necessary to meet the demand at any
point in time. Both scenarios where supply lags demand (leading to an excess demand) and
supply leads demand (leading to a drop in demand) is harmful for businesses.
A robust SCM system helps in countering the demand aided with the help of strong forecasting
models and statistical methods. Thus, SCM system plays a major role in meeting the demands
of products and services and when in global catastrophes, this elaborate network which is like
the well-oiled cogs of a clock suddenly come to a staggering halt. This leads to a drop in supply
which generates a gap in demand to be filled.
In the first image below, the difference between the quantity demanded and the quantity
supplied (Qd - Qs) is the gap in demand which leads to a rise in prices of products which leads
to a drop in overall output (GDP) of the nation.
Image source- http://kwanghui.com/mecon/value/Segment%204_5.htm
A perfect Supply Chain Management System has to have a number of features which
distinguishes itself from all other inferior SCM systems present in the world. These qualities
which entail a mix of quantitative and qualitative are as follows-
1) Responsive and Agile
2) Leveraging Technology
3) Foresight enabled
4) Mixture of Just In Time and Inventory Storage
5) Lean Manufacturing
6) Choosing the right suppliers and establishing long term relationships with them
7) Hyper efficient inventory management

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Measures to fight back
a. Generic Measures
 Now that businesses are understanding how COVID-19 has impacted the supply chain,
there will be investments in warehouses that are equipped with the state-of-the-art 3D
printing technologies and having its own fleet of autonomous vehicles. Last Mile
Deliveries, Reverse Logistics, Digital Supply Chains, are all potential possibilities in
the near future.
 The sole Just In Time methodologies assume largely that global disruptions like these
won’t occur but given the uncertainty (we’re living in a VUCA world after all) of the
times, it is best to combine JIT with optimum levels of Inventory Management (like 45
days of Inventory Storage- Rebuffering).
 Inventory counting mechanisms need to be automated which will lead to correct
predictions for Reordering Point and improve the overall Supply Chain efficiency.
Diversifying suppliers across geographies would allow organizations to have greater
leverage in times of duress.
b. Specialized Measures
There are certain measures to if not fight back then certainly minimize the disruption caused
by any global catastrophe. Certain tools equip SCM managers to effectively mitigate the effects
of a global pandemic and enable the Supply Chain to work with minimal impacts. Some of
these necessary theoretical tools are-
1) Institutional Theory- This theory in SCM deals with the fact that organizations with
isomorphic structures will adopt the best practices from one another leading to fiercer
competitions and the need for innovation ever so frequently. In the pandemic or
catastrophe context, organization will mimic the supply chain responses and
innovations of others. This will be increasingly legitimized as well across the middle
and top management tiers. Desperation in meeting the huge demand gap will lead to
further copying of best practices
2) Resource Dependence Theory- This tool studies the effect of external resources of an
organization or a company and how they affect the organization. Ideally organizations
should strive to reduce the dependency of these factors. PESTEL Analysis and Porter’s
Five Forces studies these factors deeply and helps identify the areas to improve in this
regard.
Porter’s Five Forces covers the following aspects-
i) Bargaining power of Suppliers
ii) Threat of substitutes
iii) Threat of New Entrants
iv) Bargaining power of buyers
v) Rivalry amongst competitors

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PESTEL Analysis covers five important aspects-
a. Political
b. Economic
c. Social
d. Technological
e. Environmental
f. Legal
Government’s effort to fight the pandemic directly affects the flow of resources between firms’
thereby widening the gap between supply and demand as seen above.
3) Game Theory- At its core, game theory strives to predict the actions of different
decision makers who are assumed to be rational in nature and who always try to
maximize their payoffs. The vast array of interaction between these decision makers
help organizations understand the relationship and various variables important to
succeed. In light of the pandemic Government will step in as a major player to alleviate
the crisis which in turn will affect the way how firms interact with each other. This will
change the inherent rules of how Game Theory functions. Shifts in supply and demand
will make forecasting a tedious job.
Macroeconomic Implications
1. Both supply and demand to shift towards left, resulting in price being constant but
output decreasing, thus resulting in declining GDP
2. In the case of healthcare, demand is increasing, and a lot of R&D has started, and new
hospitals have sprung up. So, in this case, the price remains constant but output
increases
3. In case India sees an uptick in foreign investments, the A.D. curve would shift to the
right, increasing prices as well as the overall output (GDP). However, as India is also
getting affected by the pandemic, it would result in the outpouring of foreign
investments, resulting in the A.D. curve shifting towards the left, reducing prices as
well as the GDP.

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Name- Biswadeep Ghosh Hazra
Institute Name- Xavier Institute of Management, Bhubaneswar
Email address- um19148@stu.ximb.ac.in
Footnote
Sources-
 https://www.thehindubusinessline.com/economy/pandemic-geopolitics-are-
redefining-global-supply-chains-says-tata-groups-
chandrasekaran/article32168600.ece#
 https://www.weforum.org/agenda/2020/04/covid-19-pandemic-disrupts-global-value-
chains/

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 https://www.allthingssupplychain.com/the-perfect-supply-chain-fact-or-
fiction/#:~:text=The%20perfect%20supply%20chain%20can,place%20at%20the%20r
ight%20time.
 https://www.infosysconsultinginsights.com/2020/05/01/re-balancing-our-supply-
chains-post-the-pandemic/