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Piyal Sarkar Ryerson University, Canada |
The COVID-19 pandemic has posed new challenges across diverse industries. In this article we highlight the challenges facing the supply chain of a leading pharmaceutical company. Mint Pharmaceuticals is a Canadian pharmaceutical company located in Mississauga, Ontario that delivers high quality and affordable generic pharmaceuticals and healthcare solutions to the Canadian market. Mayank Batra, the director of supply chain at Mint Pharmaceuticals, has experience conceptualizing, implementing, and anchoring initiatives to improve business outcomes with exposure to major international markets. Mr. Batra spoke with OR/MS Tomorrow to share his insights on the challenges and supply chain recovery strategies during the pandemic.
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Mr. Mayank Batra Director of Supply Chain Mint Pharmaceuticals |
Q: How has COVID-19 impacted your company?
The COVID-19 pandemic is a global crisis with unprecedented impact on supply chains all over the world. It has created unique opportunities and challenges for our organization. Mint Pharmaceuticals has helped avert 15 national drug shortages on 10 different molecules since 2014.
Sales of hydroxychloroquine doubled in Canada during March-April as various preliminary reports touted it as an effective treatment for COVID-19. This anti-malaria drug is mainly prescribed to treat auto-immune diseases such as lupus or rheumatoid arthritis. We provided a unique solution by collaborating with the Government of Canada for supplying and storing 7.5 million doses of this product, which has helped secure safety stocks for Canadians in need. Similarly, we have contributed immensely by creating sufficient supply and unique distribution solutions for all our other products, managing the ups and downs of the demand curve during the pandemic.
There have been disruptions at every node and touchpoint of our supply chain. Starting from running operations of our manufacturing plants, availability of raw materials (RM), increased RM prices, caused local shutdowns, disrupted manufacturing schedules, reduced air shipment capacities, increased freight costs, curtailed workforce availability and so on. We have been challenged on all the fronts in the supply chain. However, so far we have been able to ensure sufficient supply for all products, navigating through all these challenges.
Q: What are the strategies that your organization has taken to tackle this situation?
To deal with the present situation, we have done intense coordination and collaboration across the front end and back end of our supply chain. We have worked very closely with our customers, plants, vendors, suppliers of our vendors, logistics service providers, transportation companies, and so on.
For example, in one case we went beyond pre-pay and arranged RM for our supplier so that she could supply on time to meet our increased requirements. In another case, we loosened the contract of one supplier so that he could take on increased plant sanitation expenses. There are so many examples of our collaboration with stakeholders in navigating these tough times. In my opinion, when the whole ecosystem must win, the individual wins are less important.
Q: What are some of the planning challenges your team faces?
Demand forecasting has been a significant challenge for planners. Regulations on prescriptions have changed twice this year which has significantly impacted demand and order patterns. Competitors are also facing significant supply challenges which have led to a disruption of their products and contributed to exponential surge in demand for our portfolio. Supply planners have faced huge issues around supply timelines because of disrupted manufacturing schedules and raw material and workforce availability. Planners are continuously collaborating with suppliers on innovative solutions to clear backorders and maintain safety stocks.
Q: How have you enhanced your supply chain resilience amidst COVID lockdowns?
We are working towards quick turnarounds on contracts to create alternate vendors and logistics service providers. We have identified suppliers and materials that pose high levels of supply chain risk in both our direct supplier base and the extended back-end supply network and have started working on alternate supply sources and solutions. We have started looking for logistics solutions that help us track our shipments and alarm us in case of possible disruptions and delays. We are revisiting inventory guidelines for our portfolio to create the right balance of working capital and availability. With consideration towards manufacturing plant constraints, we are conducting multiple scenario planning exercises, mapping different demand, supply and commercial levers to prepare ourselves for different cases and create resilience in our supply chain.
Q: How have COVID lockdowns and the shift to a work-from-home model impacted the workforce within your company’s supply chain?
Lockdown has impacted the supply chain workforce significantly. Our manufacturing operations have faced many challenges to maintain an adequate workforce to run plants and distribution centers smoothly. This challenge has impacted supply planning, logistics planning, and allocation activities. Lockdown has also shifted customer behavior and buying patterns drastically. We responded by increasing scenario planning activities, which has become an important part of the sales and operations planning (S&OP) process. Work-from-home has also brought more focus on the ongoing digital transformation of supply chain management (SCM) processes and systems so that we are prepared to provide infrastructure for collaboration and smooth SCM operations if required to work remotely in future, too.
Q: What skill sets would be useful for budding supply chain managers in the post-COVID era?
Looking at every challenge from the lens of how an action will impact the whole system is very important. Network collaboration, scenario planning, working capital impact analysis, periodic inventory policy reviews, S&OP, alternate suppliers mapping, and many other tools equip supply chain managers to bring resilience to the supply chain. There is a fine balance between service level, working capital, and availability. With the flexibility to review and rebalance, SCM managers can better navigate these situations.