Article: Preparing supply chains for disruption
Supply chains need room for manoeuvre
How can companies organise their supply chains reliably even when important transport routes are temporarily restricted? Bernhard Osburg, Member of the Management Board of Deutsche Bahn AG responsible for Freight Transport and Chairman of the Management Board of DB Cargo AG, addressed this question at BVL Supply Chain CX on 21 October. As an example, he referred to operational restrictions in the Hanover area during the summer. In his view, these had a significant impact on the transport chains of the steel and chemical industries.
The example shows how important it is to take possible restrictions into account at an early stage of transport planning. For periods of engineering works and route renewals, DB Cargo works with customers to develop alternative concepts well in advance. Some customers even adapt their entire supply chain strategy for the duration of the work.
For system-critical services, such as those for the steel industry, the aim is not solely to make operations as efficient as possible. Instead, Osburg said, the principle is “resilience rather than efficiency”. Such precautions can entail additional costs. Osburg contrasted these with the potential consequences of a production stoppage.
Alternatives must be prepared in advance
Low water levels on the Rhine show that this planning approach is not limited to engineering works. Osburg expects such situations could become more frequent in future. Companies along the Rhine therefore need to consider how to safeguard their transport operations when inland shipping is restricted.
A greater shift to rail can be one option. However, additional rail capacity cannot be made available at short notice on demand. Osburg therefore advocates prepared concepts that establish in advance which alternatives will be available when required and how the necessary capacity will be financed.
The examples show that resilience does not begin only when disruption occurs. Alternatives need to be planned beforehand and coordinated with the partners involved.
Industrial supply requires suitable systems
Alongside planning individual services, single wagonload transport also plays an important role in supplying industrial sites. Osburg describes it as an “industrial sorting function” and emphasises its importance for Germany as a geographically dispersed industrial economy.
At the timetable change, DB Cargo intends to transition the system to a more frequently scheduled hub model. Osburg also made clear that single wagonload transport continues to depend on public funding because of its high proportion of manual work.
Freight structures are also changing. Declining coal and ore volumes, for example, are shifting the demands placed on DB Cargo. DB Cargo intends to align its offering more closely with changing transport needs. Osburg sees potential in European and multimodal solutions that make it easier for customers to organise their supply chains and reduce supply chain complexity.
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