Archives March 2023

April Episodes for Chain Reaction Advanced Information.

• Super Forecasting and Artificial Intelligence (AI)
• The Role of Management Consultants and Business Schools
• Ethical Supply Chains

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All things impacting global supply chains this week.

• Importance of labelling for cross border checks and quality control
• Brexit problems continue to disrupt supply chains in the UK adding additional costs and friction with added risks and reputational damage to many businesses
• Average inventories have increased for many businesses since the pandemic with higher risk and cost trying to make supply chains resilient
• Interest rate rises in the US and the UK to combat inflation
• CPI in the UK rose to 10.4 per cent
• Tik Tok CEO is interrogated about data privacy by the House Energy and Commerce Committee on Capitol Hill. Government employees in the US and UK have been instructed not to use Tik Tok on work devices.
• SVB hit problems last week and reassurances were given by the banking industry that this was not a systemic crisis. This week Credit Suisse Bank is rescued by UBS.
• Accenture sheds 2.5 per cent of its global workforce
• Friendshoring impacts global GDP according to the WTO. It is a key policy instrument for US Government to make supply chains resilient.
• A year ago the IMF said social unrest could damage global supply chains and impact GDP of nation states. This week we were reminded again with the protests in France against the introduction of pension reforms. We also have lots of strikes around the globe as inflation puts pressure on the cost of living for many.
• FedEx is making changes to its operations with cost cutting measures to improve profitability.

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Tony Hines takes a look at key challenges facing global supply chains.
Five strategic challenges are the focus for the discussions in this episode:-

1. The move from analogue to digital supply chains – combining the digital and physical to serve customers efficiently and effectively.
2.  Culture of supply chain organizations.
3. Hines' 7V's – Value Creation Model
   Value in the supply chain is determined by Volume+Volatility+Velocity+Variability+Virtuality+Visibility+Variety
4. Geopolitical risk and uncertainty impacting global supply chains
5. Sustainability and Climate Change

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All things impacting global supply chains this week with Tony Hines.

• Shell CEO plans to keep oil for at least the next decade.
• Tomato imports into the UK suffer from supply chain friction. This has caused shortages on supermarket shelves.
• Delays to HS2 as costs rise. Many think this is a pull back from the levelling up agenda which is likely to impact of future economic advantages HS2 promised to deliver.
• Once upon a time…
• While people struggle with the cost of living the CEO's of two leading global oil companies Shell and BP earn salaries around $12 million.
• New regulations at US Ports could lead to capacity problems.
• Renault and Nissan Strategic Alliance about to be renewed.
• SAP SE to shed 3000 jobs.
• The new EV Road Map foreshadows a new Toyota Way.
• US Economy grew 2.9 per cent in Q4. 
• US added 11,000 jobs in February.
• China renews an unprecedented 3rd term in ofiice for President Xi Jinping.
• The future of supply chains will create opportunities.
• The Dutch Government announced restrictions on the export of Chip Technology to China and this will impact ASML.
• Plastic entering the world's oceans has risen exponentially since 2000 according to a new research study.
• Mitsubishi Motors said it plans to sell only EV's by 2030
• Stelantiss, Mercedes and ACC is developing 3 giga factories.
• Silicon Valley Bank (SVB) sends a chill wind through US Banking sector. It is the first failure since 2008.

Pick up any episodes you missed.

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Tony Hines talks about partnerships and power within supply chains and how it impacts arrangements.

Partnerships in supply chains are essential to create effective and efficient systems. Nevertheless. How many supply chain partnerships work like we would expect? Many supply chain arrangements are partnerships in name only. The reality is that power of a dominant actor in any supply chain will redistribute resources earning a greater share of profit and will control cash flows. The impact of a dominant player is critical to other in parties.

Some dominant players act ethically and are a force for good while others do not.

Cargill is a privately held conglomerate that has over 157 years of experience. The company is a dominant player in food supply chains and transportation. It is highly profitable and a responsible actor. Cargill is both a catalyst and connector. Listen to find out more.

Research on power in supply chains has increased in the last decade often as a consequence of news stories reporting negative impacts. Much of the research is what I call neat and tidy meaning that it builds arguments robustly adopting appropriate methods and theoretical frameworks to fit an academic agenda. However. Much of the neat and tidy research fails to uncover managerial or practical concerns of those managing complex, multi-product and globally dispersed supply chains. I have picked a few that buck the 'neat and tidy' trend. Personally, I would like to see much more focus on practical concerns that make a real contribution to improving our understanding of complex supply chain arrangements.

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Tony Hines with all things impacting global supply chains this week.

•  UK Government agrees a revised Northern Ireland Protocol avoiding borders on the island of Ireland and in the Irish Sea. This should reduce supply chain frictions that hampered the post Brexit trading arrangement. 
• Brent crude closed the week at $85.47 per barrel which is about 1 per cent up on the week. UAE denied rumours that it is about to leave OPEC to pump more oil. China’s returning demand for oil is also pushing up prices.
• The U.S. Federal Reserve said it is “acutely aware” of the challenges high inflation poses to the economy and is “strongly committed” to its 2% target for price increases, the central bank said on Friday in its latest semi-annual report to Congress on monetary policy and the economy. 
• Russia's ruptured undersea Nord Stream gas pipelines are set to be sealed up and mothballed as there are no immediate plans to repair or reactivate them, sources familiar with the plans have told Reuters. 
• Patrick and John Collison are seeking fresh funds for Stripe the company they co-founded 13 years ago while exploring options to take it public, according to people familiar to the matter.  Venture capitalist Paul Graham once called Stripe “the next Google”.
• Apple iPhones soon to be assembled at another site in the southern Indian state of Karnataka and 300 acres have been aside to set up a factory, the state government said on Friday. Bloomberg News had earlier reported that Apple partner Foxconn Technology Group planned to invest about $700 million in the Karnataka site to ramp up local production. 
• Volkswagen's off-road brand Scout Motors said on Friday it would build a $2 billion manufacturing plant near Columbia, South Carolina, for trucks and SUVs. The investment could potentially create 4,000 or more permanent jobs and more than 200,000 Scout vehicles could be produced annually at the facility. VW last sold a pickup in the United States in the early 1980s.
• IMI is diversifying it's supply chain away from China as a consequence of geopolitical tensions.
• Irish packaging firm Zeus is opening a new facility in Cork.
• Shipping is responsible for large quantities of greenhouse gas. A new report “All Brands on Deck” takes a look at major retail brands and their contribution through shipping. Wal-Mart tops the list.
• China's economy due to grow at a higher rate in 2023 exceeding the 3 per cent rate achieved in 2022.
• ARM Holdings have decided to list only in New York in 2023 which is a blow for the London Stock Exchange. Raising concerns that the LSE may not be doing enough to attract tech companies. Capital market reforms  by the UK Government may have influenced ARM's decision.
• Mexico becoming quite a manufacturing hub for the US – Tessla announced plans for the firms largest E.V. factory investment this week.
• Amazon is pausing the second phase of HQ2 in Virginia.
• The US has moved to top of the list of energy exporting nations.
• Catch any episodes you have not yet listened to.

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We have four episodes in March which cover different aspects of managing supply chains and their impact on business.

1. All Change asks if change is always a force for good.
2. Partnerships and Power asks the question what impact does power have in supply chain partnerships.
3. Five key strategic challenges for supply chain management.
4. What impact has management consultancy had on supply chains, business and government is the final episode for March.

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This is a short edition telling you what is coming up in March on the Chain Reaction Podcast. Look out for the episodes and catch up on anything you have missed.

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All change, no change, continuous change. Is change a force for good or should we be more sceptical about change? When we learn we change and that is good but what about other types of change. In this episode Tony Hines takes a look at reasons for change and weighs up when change is good and not so good.

Winston Churchill said to improve is to change and George Bernard Shaw said progress is impossible without change. So when is change needed?

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