A group of executives discussed strategies for inflation, supply chain disruption and the emerging Ukraine crisis at TBM’s quarterly operations executive roundtable. While there is no shortage of emerging issues, a few themes emerged.

  • Costs are up, but it isn’t always viable or strategically sound to pass them along to customers. Instead, some manufacturers are sacrificing short term margins to retain customers for the long-term, modifying designs, qualifying substitutions, and directing customer demand toward more affordable or readily available options.
  • Executives are considering nearshoring, onshoring, and insourcing more than ever before. Operations executives are prioritizing supply chain regionalization and investigating solutions to overcome the challenges involved.
  • When deciding where to manufacture products, a view of true “landed costs” may require a break in traditional corporate thinking. The standard manufacturing cost per unit in a low cost region may in fact cost much more to produce abroad than you think.
  • Diversity and balance across the supply chain will be key to effective long-term strategies that can help operations executives better manage both cost and risk.