Surviving coronavirus: tips from a supply-chain expert

Hitendra Chaturvedi, Arizona State University
Hitendra Chaturvedi, W.P. Carey School of Business at Arizona State University (

As coronavirus escalates globally, so do fears about a possible global recession. While companies are doing what they can to mitigate the crisis, one industry observer believes this is the time to take heed of lessons that can help prepare for future crisis.

Hitendra Chaturvedi, a professor at the Supply Chain Department of W.P. Carey School of Business at Arizona State University and an expert on global supply chain sustainability and strategy, said in a recent article written by Dan Dunkin of, “The coronavirus is an abnormal occurrence. Businesses cannot completely insulate themselves from such events, but they can certainly reduce risk so it will hurt but not be life-threatening. The whole idea is, what is the strategic insurance policy against such unexpected events, and what is the cost businesses are willing to bear?"

Chaturvedi noted that companies have long developed strategies to mitigate risk and recover from potential disasters for data centers. “Why should we not have the same for our manufacturing operations?”

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Chaturvedi recommends businesses follow these courses of action:

Localize more inventory. “Holding inventory in multiple locations closer to your customers makes sense in many cases, even if it may be costlier than in other countries,” Chaturvedi said. “I think companies in the U.S. will start to keep more inventories here as a reaction to the coronavirus.”

Localize core manufacturing. “If your current business relies heavily on products being made in China, you’re probably concerned right now,” Chaturvedi said. “Consider having a manufacturing operation in the U.S., or at least part of your operations here, so even though the cost may be high, business survival will not be severely impacted. It’s another way for companies to have more control when events happen out of their control.”

Separate R&D from manufacturing locations in other countries. “If it makes sense to maintain your core manufacturing outside the U.S., keeping research and development work closer to home ensures your future product development does not get impacted,” Chaturvedi said. 

Invest in new technology for transparency in supply chain and disaster simulation. “Blockchain can easily provide transparency across the supply chain," Chaturvedi said. “Get visibility across at least Tier 1 and Tier 2 suppliers. 

"The more you know, the better you will be at spotting trouble spots and handling crisis. Moreover, investing in Artificial Intelligence-driven risk simulation models based on numerous factors, including a global pandemic, nature events or political instabilities may be a prudent choice."

Chaturvedi summarized his thoughts by stating, “Events such as a worldwide health crisis are a standalone business risk and an amplifier of vulnerabilities. We often get complacent after a crisis settles down, but businesses who prepare for the next time will be in a stronger position to respond and recover.” 

FierceElectronics would like to thank for permission to use material from their article for this story.



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