Archives January 2023

Tony Hines talks about the application of systems thinking to improve supply chain practices.

Systems Thinking is an approach developed by Peter Checkland to understand the system. The system that Checkland concerned himself with was an organization and its human interactions with physical space, technical systems and places / locations in a temporal dimension. Supply chain systems are such a system. Checkland's approach became synonymous with 'Soft Systems' because of the people within the system that is, the agents of change.

CATWOE is the mnemonic that describes the approach:
C = Customer/Client – Beneficiary of the system
A = Agents/ actors in the system
T = Transformations involved in the system
W = World-view
O = Owner of the system problem
E = Environment

Examining interconnections and interactions within each part of the system enables us to describe the whole system. It has many applications including understanding supply chain systems.

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This is a special edition discussing some of the issues from the World Economic Forum in Davos.

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All things impacting global supply chains this week:

• Port of Antwerp Bruges New Gen Circular Economy Project to build a plastic recycling plant at the Port.
• Mario Paganini from Stord writes about doing more with less.
• Hapag Lloyd FE9 managing ocean freight demand and over capacity.
• Port of Georgia handled 6 million TEUs in 2022.
• James E Martin comments on the Procurement Professionals Survey conducted at the end of December. More investment is needed in technology. What do the C suite not understand about supply chains?
• Climate change impacting ocean going supply chains. Port designers have their work cut out to meet the challenges. University of Oxford Report.
  International trade and world economies exposed to multi-billion-dollar climate risk to ports – Oxford study | University of Oxford
• Lori Ann LaRocco, CNBC reported downturns in global sea traffic. Noted that there are four trends painting a picture of the future supply chain.
• Veronica Bates Kassatly commented on CHG emissions in the Fashion Industry and a recent McKinsey Report
• More cyber attacks disrupting supply chains.
• British Volt finally bowed out as the juice ran out this week.
• Tessla's 2016 staged video report emerges 
• Automated Trucks

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In this episode Tony Hines takes a look at the questions we need to ask when we want to solve a problem in the supply chain.

• What
• Where
• When
• Who
• How
• Why

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Tony Hines assesses the economic outlook for 2023 and what it might mean for supply chains, businesses and consumers.

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All things impacting global supply chains this week.

• Container prices fall as demand and congestion eases
• Amazon announces 18,000 lay offs
• UK new car sales hit a 30 year low in 2022 but likely to grow in 2023
• Tessla car sales fall to lowest level in 5 months
• Dell is looking to phase out China made chips because of US blacklisting
• Oil prices fell 9% in the first two trading days of 2023
• Russia is sending Arctic Crude Oil to India and China at big discounts
• Retail figures for the holiday period are in for the UK
• Cost of living is switching consumer buying habits
• Food inflation 13. 3% (BRC) and 14.4% (Kantar) in the UK and up 16.5% in the US
• Aldi forced to cancel special buys as a consequence of supply chain disruptions
• UK Grocery sales hit £12 billion 
• Sales growth figures for competing retailers 12 weeks to 25th December

Reminder to catch up with any episodes you missed

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These are some of the forthcoming episodes that you will want to listen to. Topics cover systems thinking, problem solving, managing the external influences and mitigating risks.

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Supply Chain Management is critical to improving cash flows. When we think of supply chains we think of material flows and not about cash flows but it is the latter that is equally important and impacted by the actions we take in our supply chains. The big consulting firms bang on about profitability and return on investment both are important but there is one variable even more so. It is cash flow because without cash the business may not continue into the future to earn profit and return on investment. In this episode Tony Hines makes the point that supply chain actions determine cash flows and that may be the difference between success and failure.

Further Reading about this topic:
https://www.routledge.com/Supply-Chain-Strategies-Demand-Driven-and-Customer-Focused/Hines/p/book/9780415683197

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