Posted by Dawn Marie Bailey
I heard the example that best helped me understand work systems and supply chains at a Baldrige training event right after the very sad 2011 Japanese earthquake and tsunami. A colleague was talking about automakers in the United States and elsewhere whose suppliers were located in the devastated region. Suddenly, manufacturers whom I didn’t even realize had Japanese connections were faced with sudden and unexpected supply-chain disruptions. Such disruptions became critical because work systems (see Glossary in Baldrige Excellence Framework; how an organization’s work is accomplished consists of, among other things, the external resources needed to develop and produce products) often depend on suppliers.
According to “The Motor Vehicle Supply Chain: Effects of the Japanese Earthquake and Tsunami” by the Congressional Research Service, “Located in the disaster region and adversely affected by these forces are a number of manufacturing facilities which are integral to the global motor vehicle supply chain. They include plants that assemble automobiles and many suppliers which build parts and components for vehicles. Some of the Japanese factories that were forced to close provide parts and chemicals not easily available elsewhere. This is particularly true of automotive electronics, a major producer of which was located near the center of the destruction.”
The National Climatic Data Center of the National Oceanic and Atmospheric Administration released a report that the United States experienced $8 billion in disasters in 2014. This included eight weather and climate disasters (including droughts, floods, severe storms, and winter storms), with losses exceeding $1 billion each across the United States. Overall, these events resulted in the deaths of 53 people and had significant economic effects on the areas impacted.
With such examples and data, many organizations turn to the Baldrige Excellence Framework for guidance on what to take into consideration when considering work system decisions, supply-chain management, and safety and emergency preparedness. For example, does your disaster and emergency preparedness system take your reliance on suppliers into account (see Baldrige Criteria, 6.2c)? And how do you consider work system decisions, including decisions on when to use external suppliers of products and services, in your strategy (see Baldrige Criteria, 2.1a) ?
How do you know if your operations and work systems are safe from disasters?