Shortage Series #2: Who Handles Supply Chain Shortages?

Supply chain shortages are tricky, even one part can halt an entire production line. Successfully navigating shortages isn’t something one person on one team can tackle alone, they require a wide range of people to manage and eliminate them. Understanding the different roles that are directly involved in shortage management and the part they play is critical to preventing shortages in the future.

who handles shortages?

What roles play a part in managing supply Chain Shortages?

  • Buyer/Planner

Buyers are responsible for placing orders for parts from suppliers and are usually responsible for following up on shortages. If the company is smaller, the buyer may even be responsible for doing their own expediting. In recent years, a lot of companies have begun to differentiate this role from “strategic buyers,” who are often the ones to set up suppliers and contracts. Another name for this “strategic buyer” role includes “planners,” since they are the ones to plan the factory and material schedule, or even “buyer planners” to further differentiate the roles. 

  • Analyst

This role is typically only employed in larger companies. The analyst helps teams build reports, represents the organization in meetings to disseminate and collect information, and often follows up on shortages in cases when the solution is more complicated than simply expediting.

  • Expediters

Expediters are the first line of defense against shortages, and like analysts, are typically only at larger companies. They will first follow up with suppliers to see if they can get an earlier delivery date, and, if that is possible,  pass it along to the buyer to update the PO. If the earlier date is not agreed upon, the expediter may follow up again, or if it becomes a complex situation—such as an engineering or relationship issue—they will pass it along to the analyst to work on. 

  • Supply Chain Manager

The supply chain manager can be the second, third, or even fourth line of defense. If the buyer, buyer + expediter, or buyer + expediter + analyst can’t solve the problem, then the supply chain manager is brought in. They make sure that the suppliers they are responsible for are supporting their product line. Bringing in the supply chain manager can be used as an escalation to signal the importance of a given need, or as leverage when needed and a relationship needs to be tended to. 

  • Supply Chain Director

Typically, the supply chain director only gets involved when for the ultra-critical parts of shortage management, when suppliers are not performing the way they should or to develop high-value, long-term relationships. 

  • VP of Supply Chain

Similar to the director, the VP of supply chain is rarely involved in managing shortages, especially at larger corporations. If the shortages are impacting a high-value customer’s orders, then the VP often gets involved. 

How are shortages being managed today?

Processes

Factories rely heavily on established processes and best practices for shortage management. They are effective because they are designed to execute a workflow that is known to be effective, but can also be measured and improved over time. Defined processes also ensure that everyone understands what they are to contribute to the team. 

Shortage management processes vary vastly from industry to industry, depending on the roles they involve in supply chain shortages, how responsibilities are delegated, and even what’s considered a shortage. Despite the variance, common methods are seen throughout, including regular meetings on the status and availability of critical parts. These meetings typically involve a “shortage report,” which is a list of all of the parts experiencing shortages. This is used as the main source of reference for the latest updates on the supply chain and internal factory operations.  

Tools/Software

Many companies use programs like Excel to manage shortages. While Excel can be a helpful tool, the data housed within spreadsheets often becomes stagnant and outdated quickly, with teams relying on manual entry to update and analyze them.  This method of data housing and analysis might have been effective decades ago, but is no longer enough to ensure factories achieve their full potential. Many companies use supply chain management software now as an alternative. These software systems help automate inventory management processes and provide visibility into real-time data.  

Looking for a shortage refresher?

Going back to basics can be a helpful way to get a firm understanding of shortages. Check out our first blog in the shortage series, Shortage Series #1: What Are Shortages and Why Are They So Costly?”