Extraordinary times call for extraordinary measures; grocery retailers and food manufacturers have implemented such measures to ensure that Canadians continue to have access to safe food. Grocers have modified their in-store practices and suppliers have changed manufacturing processes and their supply chains to address unprecedented demand. “In Their Own Words” brings the behind-the-scenes stories to Grocery Business' readers.
Mark Taylor, president & CEO, Lactalis (Parmalat) Canada
Crisis leadership initiatives
Our over-arching goal from the beginning has been to protect our people, our suppliers and our partners so that we are able to continue operating our 17 manufacturing plants and distribution operations across Canada as an essential service in helping “feed the nation” with healthy and nutritious dairy products.
Because Lactalis has operations around the globe, including China, we were able to get a view on the early evolution of the issue and move quickly to put in place our business continuity protocols here in Canada. It has also allowed us to both leverage and share best practices with our global colleagues; a great help when you consider we have significant operations in some of the countries, like Italy and France, that were hardest hit in the early stages of the pandemic.
That really speaks to how critical it’s been to have open lines of communication, first and foremost with our 3,500 employees across the country, but also with our suppliers, regulatory agencies, milk boards and of course our customers who have done an extraordinary job of serving the consumer under very difficult circumstances.
Impact on the supply chain
The only time I can recall similar levels of upheaval in a dairy supply would be in 1994 following the deregulation of the Milk Marketing Board in the UK. On that occasion it was country specific, whilst in this instance it’s an issue impacting industries around the globe.
Supply management in Canada insulates us from some of the potential negative impacts in global markets, but also restricts us from accessing some opportunities too. The supply management system could help dairy farmers to adapt their milk production to match the market demand. As many countries consider the resilience of their food supply chains and their exposure to imported food, one could see more importance being placed on supporting domestic production. I hope this will include recognition of the importance of manufacturing capabilities as well as primary production, as we are together providing this essential service to fulfill the needs of consumers.
The surge in buying at retail in the first weeks of the pandemic was very significant. At the same time our Food Service business came to a virtual standstill, although we have seen an improvement recently as businesses have adapted their supply chains. I give full credit to those organizations that have done an amazing and highly entrepreneurial job in this regard. Minimizing disruption to our customers and adapting to the dynamic marketplace has required us to manage our business hour by hour, around the clock, seven days a week.
The pandemic has led to changes in the balance of demand by channel, by product category and by SKU. Some changes have been unprecedented and have required us to rapidly adapt normal practices. The fact that, overnight, we were able to pivot and double production of fluid milk in our plants and meet the needs of our customers is a true testament to every one of our employees across the country, including our operations and supply chain teams, as well as our incredible, resilient and committed colleagues working in our plants.
We are now seeing a return to a more steady state, at least for the time being. In the aftermath of the initial changes in the balance of demand and supply, we are now in a situation where we have excess inventory of some products where demand has softened and potentially tight availability of other products where demand has increased. We are working closely with our customers to address this issue so that, together, we continue to meet the needs of consumers.
Your business takeaways from this experience
We must begin thinking about how we anticipate and adapt to the realities of the post-pandemic marketplace. It’s human nature for people to want things to return to normal, but what will that look like; what will be the “new normal”? Looking further into the future, we must consider what broad, systemic opportunities we anticipate, or see clearly, and how we adapt our business to leverage them. Questions we’ve really never before been forced to ask ourselves, or had the burning platform to act upon, but absolutely must be considered within the context of what could be a vastly altered supply chain and marketplace. Good companies focus on adapting to the current situation. Great companies focus on leading change and creating the future.
Our experiences over the past eight weeks have also reminded me that anyone can be a leader and that leadership is not about your job title or where you fit into an organizational chart. It has been absolutely reaffirming for me to see examples throughout our business of individuals stepping up and grabbing opportunities in order to meet the needs of our customers as well as to support their colleagues. How we lead during these challenging days will shape the relationships we have with our employees, our suppliers, partners and our customers for many years to come.