Trade dispute, irregularities, inflation, currency devaluation, natural disasters, terrorism, regulatory changes and legal disputes have been listed as risk areas affecting supply chain in the haulage and logistics sector in Nigeria.
The need for synergy among practitioners was also emphasised as a means to curb the various challenges experienced in the industry.
This was disclosed at the Haulage and Logistics Magazine yearly Conference and Exhibition (HAULMACE 2022), themed, ‘Developing an Adaptive Framework in the Nigerian Haulage and Logistics Industry: An Imperative for Stability in a VUCA Environment’, in Lagos, recently.
Senior Procurement Manager, (Logistics, Indirect & 3rd Party Manufacturing) PZ Cussons, Deji Ogunde, explained the major risk categories as internal, external and environmental, which are further broken down into process and control, supply and demand, and environmental factors.
He called on industry practitioners to embrace the reality, take up the challenges and seek lasting solutions to move forward.
He suggested the implementation of the new supply chain strategy, which includes sustainable management, agility and resilience.
According to him, supply chain agility responds better to unforeseen changes as they are able to synchronise supply with demand, adding that in recent years, sustainable supply chain management has become increasingly important global practice.
Ogunde noted that recent occurrences such as COVID-19, energy cost increase, Russia-Ukraine war, Suez Canal blockage, forex, currency fluctuations, flood have caused disruptions in the industry.
He recommended innovation, technology, data gathering, collaboration and right workforce for the development of the sector.
Convener, HAULMACE, Alfred Okugbeni, stated that the world has become increasingly interconnected not just because of technological advances but also through global threats like global warming.
He noted that Nigeria, which is part of the global economic system, has equally witnessed significant disruptions from local developments and external shocks.
According to him, the business environment today can be described as highly unstable and unpredictable, where disruptions have become the new normal.
“This environment is also described as ‘VUCA’ (Volatility, Uncertainty, Complexity and Ambiguity). VUCA is an acronym that was used for the first time in 1987 by the United States Army War College after the cold war. It is a concept that is gaining new relevance to characterise the current environment in which we find ourselves.
“The bottom line is that the disruption of supply chains has become the new normal since the year 2020 and both countries and businesses alike should find an adaptive framework for managing the issues in order to minimize the effect of these continuous disruptions,” he said.