Sure, because it can vividly illustrate how the supply chain works. This week, I had the pleasure of discussing Supply Chain Management and current developments in SCM during the #GDV (Gesamtverband der deutschen Versicherungswirtschaft e.V.) event in Bremen.

The reason I had toilet paper in my hand was simple: to explain how a 'Bullwhip effect' works.

Toilet paper shortages during events like the COVID-19 pandemic in 2020 serve as a real-world example of the bullwhip effect in action. When consumers initially heard about potential shortages, they panic-bought toilet paper in large quantities, causing a sudden surge in demand at the retail level.

And everyone can relate to the fact that toilet paper consumption stays relatively stable, right? Retailers, in response, increased their orders to manufacturers, who then increased their orders to distributors, and so on, with each tier of the supply chain reacting to perceived demand fluctuations.

However, as the panic-buying subsided and consumers returned to their regular purchasing patterns, there was an oversupply of toilet paper in the supply chain. This led to excess inventory at various levels, increased storage costs, and inefficiencies.

The exaggerated demand signals at the beginning of the pandemic created a bullwhip effect, causing disruptions in the toilet paper supply chain and highlighting how even small fluctuations in consumer demand can result in significant supply chain distortions.

And the only way to eliminate these bullwhip effects is when the entire supply chain talks with each other and doesn't resort to panic.

Of course, I didn't just talk about toilet paper as it was a quick example. In a nutshell, the main results of my speech were as follows:

• SCM (Supply Chain Management) has established itself as the central control unit in most companies.

• Many risks in SCM will continue to require management (climate, global economy, globalization).

• Sustainability is now relevant to every company. The complexity and volatility in the supply chain will continue to increase.

• All of this necessitates digitization and automation, as well as the use of AI.

• This leads to a new set of requirements for SCM professionals, and the shortage of skilled workers will initially persist.

• This, in turn, accelerates digitization.

• However, there are also opportunities in SCM, especially for technological pioneers and those willing to collaborate with others, which keeps SCM continually exciting.

Thank you and keep on rocking!

Marko