MT498 Unit 6 Port Closure Seminar Reflection Example

Rerouting Was Cheap, Timing Was Not: An MT498 Unit 6 Seminar Reflection on a Baltimore Port Closure

[Student Name]

Purdue University Global

MT498: Bachelor's Capstone in Supply Chain Management

Unit 6 Seminar Reflection

[Instructor Name]

[Date]

Lowry Filter Company, its volumes, the disruption card and the classmates are composite; the sources cited are real.

The Card as Dealt

In our Unit 6 seminar each of us presented the design we had carried forward from Unit 5 for five minutes, and then a classmate drew a disruption card and applied it to our network. My design moves three of Lowry Filter Company's six pleating lines to Groveport, Ohio, to serve eastern customers. The card read: port closure, Baltimore, eleven weeks. I quote it exactly because I did not choose it, and it hit the one lane in my design that crosses an ocean.

The Answer I Gave

Premium filter media for the higher-efficiency line comes from an overseas mill in ocean containers through Baltimore. My answer in the room was quick and, I thought, sufficient: Norfolk can take the containers. The extra trucking from Norfolk to Groveport is about 140 miles, which at $2.40 a mile adds $336 a container. Spread across the 9,800 cases of filters a container supplies, that is about 3.4 cents a case. I said the design would barely notice, and I sat down.

The cost of rerouting was trivial; the cost of a late container was not.

What I Had Missed

A classmate who coordinates customs entries for a freight forwarder asked how long one container lasted. I did not know, so I worked it out that evening. Eastern premium demand is about 63,360 cases a year, roughly 1,218 a week. One container therefore covers about 8.0 weeks of eastern premium filters. My design held 21 days of premium media at the Ohio site.

The problem was never the extra miles; it was timing. When a port closes, ships already at sea divert, wait at anchor or queue at the next port, and Norfolk would be handling Baltimore's overflow for weeks. A container scheduled to arrive two weeks into the closure could easily land a month late. With 21 days of cover and eight weeks of demand riding in each box, a single late arrival would leave the Ohio lines without premium media for weeks, and premium filters would go short at exactly the accounts the design was meant to serve better. Sheffi (2005) argues that a disruption's damage depends less on the event itself than on how long the affected link takes to recover relative to the buffer available, and my answer had measured the wrong thing.

The same classmate suggested splitting premium orders across two ports, which would halve the exposure to any one closure. It is a good idea, and I want to test it, but it would mean ordering smaller containers or less often filled ones, and the overseas mill sets the container size.

The Answer I Would Give Now

The revised design does two things. First, it raises premium media cover at the Ohio site from 21 to 35 days. The extra 14 days of stock is about 2,430 cases' worth of media, worth about $17,500, which at Lowry's 22 percent carrying rate costs about $3,850 a year. Second, Lowry's forwarder will hold a standing booking option at Norfolk, so diverted containers have a confirmed place rather than a queue. Neither change costs much; both change what happens in week three of a closure. I will enter the $3,850 as a line in the Unit 7 landed cost model, not leave it as a remark in a reflection. Sheffi and Rice (2005) describe resilience as building in redundancy or flexibility before a disruption, and the extra cover is the redundancy here.

What the Card Left Untested

The card assumed only the port failed. If the overseas mill itself stopped, rerouting and buffers would only delay the shortage. A second source of premium media would be the real answer to that case, and I have flagged it for the Unit 8 risk assessment.

The seminar also gave me a method for that assessment. Simchi-Levi et al. (2014) suggest comparing, for every node, how long the network can keep serving customers after the node fails with how long the node takes to come back. My port answer had looked only at whether an alternative route existed. Measured their way, the port closure is a gap of a few weeks that 35 days of cover now closes, while a failed mill could be a gap of months that no reasonable buffer closes. That comparison, done for every node and lane on the redesigned map, is how I plan to rank risks in Unit 8 instead of listing them by how alarming they sound. It also means the reflection's real result is not a bigger buffer but a habit: asking how long, not only how much.

References

Sheffi, Y. (2005). The resilient enterprise: Overcoming vulnerability for competitive advantage. MIT Press.

Sheffi, Y., & Rice, J. B., Jr. (2005). A supply chain view of the resilient enterprise. MIT Sloan Management Review, 47(1), 41-48.

Simchi-Levi, D., Schmidt, W., & Wei, Y. (2014). From superstorms to factory fires: Managing unpredictable supply-chain disruptions. Harvard Business Review, 92(1/2), 96-101.