Association of Supply Chain Management

6 BUSINESS VIEW MAGAZINE VOLUME 9, ISSUE 11 has factories all over the globe, to supply nearby markets with the toys at a rapid rate. Its nearshoring strategy proved its worth during the pandemic: Profits doubled in the first half of 2021 when many people were in lockdown and others were staying home to keep safe and needed an activity to keep them busy. Although this plan has been in the works at Lego for years, the state of the supply chain today— including skyrocketing energy costs, greater risk, and increased complexity — has forced many organizations to consider nearshoring as a method of boosting resilience. Another technique, redundancy, is gaining momentum. Dirk Holbach, chief supply-chain officer for Henkel’s Laundry & Home Care business unit, told McKinsey: “We manufacture a certain product technology in two locations so that we have a backup. If one location goes down, at least I can manage the supply for a couple of weeks. We cannot replicate capacity ad infinitum, but that is one very simple principle.” If a major weather event or other crisis affects one facility, the second one is ready to start supplying goods to consumers, limiting delays down the line. Supply chain professionals have witnessed firsthand how redundancy, nearshoring, and other methods of building resilience can prevent disruption in the supply chain, and they’ll continue to expand these processes into their networks in the coming year. The days of the traditional linear business model —“take, make and throw away”— are officially gone. Not only do these wasteful practices harm the environment, but they’re also incredibly wasteful, costing businesses and ASCM ASSOCIAT ION OF SUPPLY CHAIN MANAGEMENT