How will COVID-19 Change Our Everyday Lives?

By Doug Voss, Ph.D.

Change. There are innumerable clichés, anecdotes, and books about it. The Greek philosopher Heraclitus wrote, “Change is the only constant in life.”

“Who Moved My Cheese” was a best-selling book about how to cope with it. Paradoxically, most of us crave the spice of variety but have difficulty dealing with change.

About a week into quarantine, my lovely wife and I were watching TV when it struck me: life was normal just a few days ago. In disbelief at this reality, I remarked as much. She nodded and said, “Hard to believe.”

Vladimir Lenin said a great many things, and I disagree with almost all of them, but he had a great quote on the timing and rapidity of change.

Doug Voss, Ph.D., professor of logistics and supply chain management

“There are decades when nothing happens, and there are weeks when decades happen.”

Someday, this will come to an end but there will be many fits and starts along the way. It’s unlikely that some miracle of modern medicine will occur that allows us to flip a switch and completely do away with COVID-19 overnight.

The fits and starts — repetitious exhaustion, joy, frustration, and exuberance — will help us transition to whatever new normal lies ahead. Nobody can be sure how our world will change once the pandemic is over but myself and many others who pontificate for a living try to predict. Here are mine.

Technology adoption will increase. Otherwise uninterested people have shown up at the tech party during the pandemic and will likely stay a while. Grandma and grandpa are part of a vulnerable population and have taken advantage of online shopping with home delivery during the pandemic. In supply chain management, we use the term “final mile” to describe the delivery of goods to their final destination. This frequently involves delivering items to a residential location and can involve everything from delivering groceries to installing washers and dryers to setting up a treadmill. More people will take advantage of these services after the pandemic is over simply because they now know they’re available and incredibly convenient.

Consolidation in the final-mile sector. Many final-mile delivery companies are relatively small. There will be consolidation in this sector for several reasons. First, it’s often the natural order of things. The small are often eaten by the large. Second, customers won’t want 10 deliveries every day. They will want fewer deliveries but larger quantities delivered in each one. This not only reduces the number of doorbell disruptions but also the number of potentially sick people coming into the home.

Inflation. Supply chain costs will increase and the price of goods will as well. After many years, firms will finally come to grips with the need to insulate their supply chains against major disruptions. They will diversify their supplier base away from riskier countries like China. This doesn’t mean they won’t manufacture goods in China. Just that they will also manufacture goods elsewhere. This way, if geopolitical or biological problems occur in China, the firm’s supply chain is not completely broken. Some of this manufacturing may even come back to America. Firms will also hold more inventory of critical goods. Some industries may even face government mandates that they hold more inventory similar to how the government regulates bank liquidity levels. The U.S. consumer will not tolerate an inability to quickly access critical items such as PPE, pharmaceuticals, and ventilators in the future.

More contactless transactions. There will be less contact with people going forward. For instance, you may not have to speak with someone the next time you drop your car off for service. You may simply call to schedule your appointment (or do it online), describe your problem, then, drop your car off without ever coming in near another person at the dealership.

This isn’t too different from how it’s often done today but tomorrow it may be the only way to do it. Amazon and Walmart have been working for years to allow customers to check themselves out and had prototype stores with this capability even before the pandemic. They will perfect it. Your items will be scanned when you place them in your cart or RFID tags will be scanned as you walk out of the store without ever having to work with a cashier.

Cashiers demand wages to work, they can sue the company if they get sick from a customer, and a customer can sue the company if they get sick from a cashier. Further, customers don’t like waiting in line to check out. Along similar lines, pun intended, more retailers will implement drive-thru or drive-up service. Drive-thrus may be an order qualifier to operate in some restaurant sectors. Customers may not feel comfortable going in stores and restaurants as often as they did pre-pandemic and retailers will have to accommodate this desire.

Increased focus on hygiene. Hand sanitizer dispensers were commonplace before the pandemic but get ready to see them on every door jam. Americans living in large, metropolitan areas will wear masks more frequently. I’m not convinced those of us in rural areas, who have not yet been as severely impacted by COVID-19, are ready to wear masks daily but big city denizens will.

Changes in workforce, work-life, and work location. The number of baby boomers in the workforce may decline precipitously after the pandemic. Many who are close to retirement won’t return to work. They may decide the health risks of being in an office are too great or they may simply enjoy staying home. Either way, boomers won’t return to the workforce in the same numbers. After taking time to reflect on life during quarantine, others will return to work but don’t want it to be the same. They may realize that they actually have a spouse and kids or that a three-hour, round-trip daily commute isn’t worth it. Commuting via public transportation will be a non-starter for many. Commuter trains are Petri dishes and people can be packed in like sardines. More employees will want to work from home. Some employers will welcome this.

Office space is expensive and reducing the lease payment will be attractive during the post-pandemic recovery. Frankly, a change toward telecommuting would do wonders for our government’s budget. The federal government hasn’t raised the fuel tax to pay for roads since 1993. Consequently, the Highway Trust Fund is chronically underfunded. The feds might consider tax incentives for companies who ask employees to telecommute just to take traffic off underfunded and congested interstates.

A return to formal attire. If you have had small children in recent history then you have heard of pajama day. Elementary schools allow kids to occasionally wear pajamas to school. It’s a fun activity. During a trip to a local discount retailer a few years ago, the number of shoppers in pajamas prompted my then 5-year-old to ask if it was pajama day at the store. I cynically replied that every day was pajama day at that particular establishment. People used to dress up to go out in public. They worked hard and got dirty all week so dressing up was a welcome change.

I’m guilty, too. I wear nice jeans, a sport coat, and boots to almost any business meeting. It’s a fashion that’s part Silicon Valley but also very Arkansan (my fashion sense is highly questionable, though, so don’t take that as the gospel). People have the luxury of being in sweatpants and blue jeans all day when they stay home. Post-pandemic, people may again relish the opportunity to get dressed up.

Change has come and will continue. I’m not a sociologist, psychologist, or a psychic (but I do have “ESPN”), and my Otterbox crystal ball case protector didn’t prevent any number of scratches and cracks. However, I am certain post-pandemic life will not be the same.

Some changes will be good while others will be bad. Some changes will be fads while others will be trends. Everything will be fine in the end. We will adapt to post-pandemic life and the next generation won’t know anything changed at all if we don’t fill them with stories beginning with “When I was a kid…”

Doug Voss, Ph.D., is a professor of logistics and supply chain management at the University of Central Arkansas College of Business, director of the college’s Center for Logistics, Education, Advancement & Research, and holds the Scott E. Bennett Arkansas Highway Commission Endowed Chair. He serves on the Arkansas Trucking Association Board of Directors.

Supply Chain Professor Eric Hurley Named to Arkansas Business 40 Under 40 List

Eric Hurley, recently hired as an adjunct professor of supply chain management in the UCA College of Business, has been named to Arkansas Business’ 2020 40 Under 40 list.

Eric Hurley, adjunct professor of supply chain management

The annual list recognizes leaders in business, nonprofits, community service and government who are making a significant impact in Arkansas.

“This is a well-deserved honor for Eric,” said Doug Voss, Ph.D., professor of logistics and supply chain management and director of the Center for Logistics, Education, Advancement & Research. “He is a great addition to our logistics and supply chain management faculty and we are lucky to have him.”

The 2020 class will be recognized at a July 22 luncheon at DoubleTree Little Rock.

Hurley is a former senior manager of business excellence at Welspun Tubular. He worked for the company, a manufacturer of steel pipes for the oil and gas industry, for more than six years. He began as a production planner in 2013 and has also served as project manager and head of department planning and contract management.

Hurley holds a bachelor’s in civil engineering with an emphasis in structural design and an MBA with an emphasis in economics.

He will teach Logistics Strategy this fall.

Is the Food Supply Chain Breaking Down?

By Doug Voss, Ph.D.

Tyson Foods Chairman John Tyson made news with a full-page ad published recently in The New York Times, The Washington Post and Arkansas Democrat-Gazette that warned “the food supply chain is breaking” and “millions of pounds of meat will disappear” from the supply chain as COVID-19 continues to spread and food processing plants are forced to close.

It is true some production facilities in the meat supply chain are being strained by COVID-19. Meat companies are taking incredible steps to protect their hard-working employees who are trying to feed their own families and yours.

Doug Voss, Ph.D., professor of logistics and supply chain management

But is the food supply chain truly breaking down as a result of COVID-19? We’ll take it claim-by-claim in a good news, bad news format. Want the bad news first? OK, here goes.

BAD NEWS: Yes, multiple meat processing facilities have been taken offline to protect employees. These facilities will generally only be offline for two weeks but this causes supply chain issues.

The supply chain functions best when we remove variability in supply, production, delivery, and demand. Supply chain costs increase, delivery service decreases, and inventory availability suffers when there are big spikes in demand, late deliveries, or manufacturing interruptions. Shutting down the meat processing facilities puts a kink in the supply chain, and there will be local impacts.

GOOD NEWS: Nobody has to go without meat.

Our protein supply chain is robust. The United States produces incredible quantities of pork, beef, chicken, turkey, and fish. After processing, consumable protein is generally directed into consumer or business-oriented channels. Some of it will be refrigerated and some will be frozen.

To give some perspective on how much inventory is held in the meat supply chain, we have enough frozen chicken in storage to feed every American at their average consumption levels for about 21 days. We have large frozen quantities of other protein types as well.

BAD NEWS: While this is encouraging, it’s not quite that simple. Frozen product destined for business-oriented channels (i.e. restaurants and foodservice organizations who sell product to restaurants and institutional customers) is packaged differently and in larger quantities than that destined for consumer-oriented channels (i.e. dominated by retailer buyers that sell the product with little to no further processing). Further processing would be necessary to bring it to consumers.

GOOD NEWS: Most meat processing plants are still running. COVID-19 has hit some areas harder than others and meat processing plants are generally located in fairly close proximity to farms and ranches where animals are raised. When an outbreak occurs in an area where a meat processing plant is located, that plant will be impacted.

The virus has impacted areas where pork and beef processing occur. The impacts have not been as severe in areas where chicken processing occurs. For instance, Arkansas food processing plants have remained open throughout the pandemic. Some meat processors have increased the production of chicken to compensate for decreased pork and beef production.

BAD NEWS: You won’t starve, but you won’t have as much variety to choose from, either. When someone says meat shortage, you probably think of an empty meat cooler. There will be less meat, particularly pork and beef, in the cooler. However, impacted meat processors also produce meat used in many other products you buy in the store such as frozen pizzas.

GOOD NEWS: In some ways, the meat processing plants are easier to start up than they are to shut down. If you’re impacted by fewer protein choices at the store, your situation will not last long.

In sum, the situation is real but nobody is going to starve as a result. At this point, the worst-case scenario is restricted variety at your local meat cooler and for products with pork and beef ingredients. To conclude with good news, would it be the worst thing if we took the time to be thankful for all of our blessings and had a few turkey dinners in May, then, another in late November?

Doug Voss, Ph.D., is a professor of logistics and supply chain management at the University of Central Arkansas College of Business, director of the college’s Center for Logistics, Education, Advancement & Research, and holds the Scott E. Bennett Arkansas Highway Commission Endowed Chair. He serves on the Arkansas Trucking Association Board of Directors.

Furnishing a Nation: Supply Chain During COVID-19

Doug Voss, Ph.D.

The country’s response to COVID-19, known as the coronavirus, has seen busy times for grocery stores as Americans stockpile canned goods, non-perishable food and household supplies to prepare for more time at home.

Doug Voss, Ph.D., director of the Center for Logistics, Education, Advancement & Research and Scott E. Bennett Arkansas Highway Commission Chair, said inventory in the channel to grocery stores is plenty as most stores receive multiple loads of product a week, and some multiple shipments a day.

“Thank a truck driver next time you see one,” he said.

Voss took part in a Q&A with us to explain how the supply chain and logistics industry responds to a crisis like COVID-19.

How does the supply chain industry respond to situations like this? Does it compare to the everyday hustle with just a few more shipments, or are there certain trips in the system that brings about a change?

“Demand is the primary driver for supply chains. As demand for certain items increases, production and transportation of that item will frequently increase as well. Demand fluctuations are an everyday occurrence. The current spike in demand for some items is pretty extraordinary but manageable thanks to the hard work of our truck drivers, warehouse workers and supply chain managers.”

Many news reports show empty shelves in several stores in the past couple of weeks. Are stores running out of products too quickly? How often are stores in our area receiving shipments?

“A simplified supply chain consists of a network of suppliers, manufacturers, storage facilities, transportation service providers and retail outlets. Inventory is held by each member of this network to some degree. The bare shelves at your local retailer are caused by demand that exceeded inventory availability in a short amount of time.

However, that doesn’t mean there isn’t plenty of product. There is plenty of inventory in the supply chain for almost every product. It’s just a matter of moving that inventory from the supplier or warehouse to the supermarket where we buy our goods.

The retailer monitors real-time sales and inventory levels. The replenishment process begins when inventory gets low. The supply chain is specifically designed to quickly replenish goods. Your local supermarket may be replenished by several trucks each day with each truck delivering a specific assortment of goods for that store.

Store shelves are constantly replenished, but now that the initial COVID-19 demand spike is complete, the supply chain will be able to catch up. That’s what the system is designed to do and it does it very well. Other than hand sanitizer, there would be plenty of product to go around if we all showed a little more restraint at the store.”

What are the problems or issues that could cause issues in the supply chain?

“The ‘kinks’ that would cause this system to break down include labor shortages or other calamitous events that stop the manufacture or flow of goods. We haven’t seen anything that would shut down the supply chain yet. Things will generally go well as long as we can keep manufacturing and moving product.”

The federal government has taken steps to remove regulations in response to the crisis. Why was that seen to be necessary to deal with COVID-19?

“The federal government has suspended many regulations on trucking companies engaged in the movement of goods critical to support our medical community and societal needs. Trucks are the only mode of transportation that can deliver goods to the front door of most locations. Without trucks, everything shuts down including the ability to decontaminate drinking water.

As an example of a suspended regulation, the federal government has temporarily removed hours of service regulations for companies hauling critical freight. This effectively expands the amount of trucking capacity by allowing drivers to work more hours each day while also speeding time to market for the critical goods they carry. We are all better off if medical supplies and food are replenished faster.”

What are the issues to watch for in the next few days or weeks?

“There was a big increase in demand for trucking services following the initial surge in grocery demand. However, many other shippers — the “Big 3” auto manufacturers — have idled production and the initial consumable demand has subsided to a degree. This means that some trucking companies will have idle capacity but, perhaps more importantly, many shippers may not be able to pay their bills. Cash flow is always important but especially at this critical juncture. Companies need to avail themselves of assistance resources available from the state and federal governments.”

For more information on programs available to small businesses, click here.

How do Small Businesses Respond to COVID-19?

If you’re a small business owner, the last couple of weeks have been filled with long days, more stress and anxiety, and questions about the future as the country responds to the COVID-19 pandemic.

School closings, mass event cancellations and postponements, and social distancing have challenged small business models across the country, including in Arkansas. How can small businesses respond to obstacles created by COVID-19?

Remain Calm

Jeff Standridge, Ed.D., adjunct instructor of Finance and managing director of the Conductor, said small business clients, customers and employees are looking to the owner for guidance.

“Your attitude and demeanor can make them feel comfortable or worried,” said Standridge. “Your thoughts impact your feelings, your feelings impact your actions, and your actions impact your results.”

Put Yourself in Your Customer’s Shoes: Reach Out!

Business owners should figure out ways to make customers more comfortable in doing business with them in the middle of self-isolation and reduced trips outside the home, said Standridge.

“Before you decide to close for two weeks, look for ways to reduce human contact points within your business,” he said. “If you can serve your customers remotely, you should do it.”

It is important for customers to see care, concern and empathy from businesses, said Standridge.

“It builds trust and loyalty,” he said. “Reduce risks, increase convenience, go above and beyond to meet their physical and emotional needs.”

Reaching out to top customers or clients, asking how they can be helped and informing them of changes your business is making can be helpful.

“Everyone is facing this crisis together, so be transparent about what your business is going through,” said Standridge. “Customers can empathize with brands facing a crisis, as long as you communicate with them properly.”

Doing the Right Thing Now Will Benefit You in the Long Run

The potential for negative press, ill will or loss of business from the general public is possible for the firms and businesses that do nothing or are slow to respond to the crisis, said Parker Woodroof, Ph.D., assistant professor of Marketing.

Whether it is transitioning to online services, reimbursing clients for missed or canceled services or offering gratuities, “being the first small business in the competitive environment gives you a competitive edge and advantage,” said Woodroof.

Go Online

When many stores shuttered in China and workers stayed home in response to COVID-19, Standridge said the savvy business owners shifted their sales strategy to social media, email and phone calls to avoid heavy losses.

“If you’re closing your store, find ways to keep your employees earning a paycheck by reaching out to your clients, selling on social media, putting your email list to good use or using a video tool to reach new leads,” he said.

Keep Your Routine

Things may not seem the same at the moment, but it’s important to keep some semblance of a routine.

Always have coffee with a mentor? Lunch with a fellow small business owner? Keep those appointments, said Vance Lewis, Ph.D., assistant professor of Management, just adapt.

“You can still have those morning coffee chats, greetings, lunches and comradery over the phone or internet just as easily as in-person.”

Plan for Cash Flow Implications & Get Help

Develop and plan for scenarios likely to result in an increase or decrease in demand for your products and services during the outbreak, said Standridge.

“Determine any potential impact on business financials using multiple possible scenarios that affect different product lines or store locations,” he said.

Other strategies that can be implemented include:

  • Reduce or eliminate all non-business-critical tasks and expenses.
  • Identify essential, revenue-critical employees and make sure they are focused on business-critical tasks.
  • If you reduce staffing levels, consider developing rotating work schedules to continue serving clients. Maintain some level of income to as many employees as possible.
  • Talk to your bank and suppliers about alternate payment arrangements. Talk to suppliers about extending payables. Talk to your bank about temporary interest-only payment arrangements.
  • Eliminate excess inventory to generate cash.
  • If the situation calls for it, reach out to your bank about the SBA Economic Injury Disaster Recovery Loan program.

Cynthia Burleson, director of the Center for Insurance & Risk Management, said it could be beneficial for small business owners to consider business income coverage.

“This is nuanced and often misunderstood,” said Burleson. “Owners need to understand their policy to see if they may have the potential for partial help due to loss of income.”

For more information regarding the policy, click here.

Doug Voss, director for the Center for Logistics, Education, Advancement & Research and Scott E. Bennett Arkansas Highway Commission Chair, encouraged small businesses to negotiate payment terms with financial institutions.

“Protect your employees’ health and financial well-being to every extent possible, and avail yourself of state and federal assistance programs,” said Voss.

For more information on programs available to small businesses, click here.

The Conductor provides free, one-on-one virtual consultation for small businesses.

“We work every day to help business owners in Arkansas to get their game plan together if they need guidance or assistance,” said Standridge.

Go to arconductor.org to set up a session.