Posts in Uncategorized

US and China Trade Wars: Analyzing the Supply Chain Impact

May 18, 2018 Posted by Uncategorized 0 thoughts on “US and China Trade Wars: Analyzing the Supply Chain Impact”

 

Understanding supply chain dependencies and the potential impact of trade wars between U.S. and China, and how you can draft an action plan to proactively respond to tariffs imposed by both countries
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R Score and its Impact on Supply Chain Risk Management

April 11, 2018 Posted by Uncategorized 0 thoughts on “R Score and its Impact on Supply Chain Risk Management”

 

Musings on a Metric: Supply Chain Risk Management with R Score (more…)

Catalonia Independence Crisis Requires Close Monitoring by Supply Chain Experts

October 10, 2017 Posted by Uncategorized 0 thoughts on “Catalonia Independence Crisis Requires Close Monitoring by Supply Chain Experts”

Many economic, capacity and labor challenges resulting from the independence process could cause serious issues for supply chains dependent on Spain and beyond

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SUPPLY CHAIN RISK MANAGEMENT IS A DATA PROBLEM…

August 2, 2017 Posted by Uncategorized 0 thoughts on “SUPPLY CHAIN RISK MANAGEMENT IS A DATA PROBLEM…”

This is first in the series of blogs highlighting the importance of data in supply chain risk management.

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CEO Resilinc

Women Entrepreneurs and Sexism in Silicon Valley – A Female Founder’s Perspective from the Trenches

July 27, 2017 Posted by Uncategorized 0 thoughts on “Women Entrepreneurs and Sexism in Silicon Valley – A Female Founder’s Perspective from the Trenches”

With all the news about harassment faced in Silicon Valley by women, I brought up this topic with my board members today. I took the opportunity to thank them for being normal and good people.

I raised $8 million in 2013 in my Series A round. I, a first generation Indian immigrant, woman, first-time entrepreneur, the CEO out of a husband-wife team, raising money for a supply chain startup was also in my third trimester with my little baby girl due in three months. (Entrepreneurs who read this sentence will understand how many inherent Silicon Valley biases I would need to overcome).

My investors gave me a fair term sheet, no games, no problems, no drama. I closed the round three weeks after my daughter arrived. I raised more money than I had hoped. I always thought it was my accomplishment and Resilinc's sheer awesomeness - "Of course we got funded" I thought, "We had reference-able customers, a huge market and a proven business monetization strategy". But after reading about the massive anomaly in funding that went to female vs male founders ($1.5 billion vs $60+ billion), I realized that the deck was actually hugely stacked against me and that I couldn't have done it without the good, normal people who believed in me. I needed to say something to these people who'd made a difference in my story and who gave Resilinc a fair chance.

No one ever sets out in the morning saying, "I'll be a sexist pig today and set a woman or two down, and show them their place". So the discrimination is so deep in the psyche that change is difficult, although not impossible. We have to talk about this even if it is uncomfortable. After all no one ever believes themselves to be sexist. Yet one prominent investor did say that we will fund Resilinc if anyone but you is the CEO (days after I shared that I was having a baby). He went on to send me CEO profiles of people (all men BTW) without once asking ME what I thought should be the characteristics of the person to lead the company that was founded from our sweat and blood and tears and sacrifice, not to mention our hard earned cash.

So, thanks Greg Silich (Angel Investor), Ravi Mohan (Shasta Ventures), John Dougery (Inventus Capital Partners), Ullas Naik (Streamlined Ventures) and all my seed and venture and angel and institutional investors who have believed in Resilinc and in me. You're good people. I want everyone to know that.

Their reaction, when I thanked them, is right on the one hand - They felt this shouldn't even be an issue, because they funded Resilinc and the team because of our capability, business value prop, market size and our expertise. Not despite, or because of anyone's gender. However, I have experienced discrimination first hand in my career, and as a HIGHLY ambitious woman, I always felt claustrophobic about the glass ceiling above me in every place where I ever worked. And now after seeing the investment statistics, it is clear to me that not everyone is aware of their inherent biases, and therefore, we do need to talk about it.

I feel that the way to drive change is to open the conversation, and to acknowledge the goodness in the people who are being fair and normal, just as we expose the sexist, abusive (and lecherous) pigs that exist among us.

I did that today, and we talked for some time about the challenges women face, and the discrimination I see or experience around me. They talked about some policy proposals that were being floated in the VC community to change things, and I shared my perspectives on how some of those were bandaids at best, and how others could have the unanticipated result of hurting women more.

I am glad we did that.

PS. As for all of you readers who looked at the paragraph about the investor who didn't want to take a risk on a CEO with all that aforementioned "baggage", and empathized with the VC - you know who you are - you need to take a deep breath, and confront some new facts about yourself.

Defining Supply Chain Risk Management Program Objectives

June 2, 2015 Posted by Uncategorized 0 thoughts on “Defining Supply Chain Risk Management Program Objectives”

Author: Wayne Caccamo

Supply Chain Risk Management Business DriversIn the Ultimate Guide to Supply Chain Resiliency Program Success, we provide supply chain risk management practitioners with concrete suggestions and guidance on how to create, roll-out, and institutionalize a global supply chain resiliency program (SCRP). As part of the “PLAN” phase we discuss the need to describe the strategic context and influences by describing the key business drivers. Key supply chain risk management business drivers we identified include:

  • Supply chain networks are larger, leaner, more global, more interdependent, more complex, less transparent, and changing more frequently.
  • Customer expectations continue to grow.
  • Commodity costs are increasing.
  • Logistics capacity remains constrained.
  • Natural disasters impacting globalized supply bases are on the rise as a result of global warming.
  • Brand risks are increasing as a result of supplier compliance, corporate social responsibility, and security practices.
  • New product introductions have been more frequent.
  • Products and services have become less standard.

I would love your input on this list. What am I missing? I am particularly interested in the drivers that are unique to your industry, geography, company scale, or other business context.

The next key step in the supply chain risk management program planning process is to identify your strategic and tactical objectives. In the Ultimate Guide we identified the following potential strategic and tactical objectives that can be used as a starting point for brainstorming. Again, what is missing? We all need to hone our collective ability to make the business case for investing in supply chain risk management strategies, processes, and tools. So, this is my attempt to crowd-source your input.

Sample Strategic Objectives

  • Achieve competitive advantage (turn business disruption threats into opportunities)
  • Protect brand value and customer satisfaction (based on customer service level data)
  • De-risk revenue and time to market goals
  • Decrease operational costs
  • Protect shareholder value
  • Ensure continuity of supply through a controlled, predictable response
  • Manage regulatory/compliance exposures

Sample Tactical Objectives

  • Decrease supply chain-related insurance premiums
  • Facilitate supplier collaboration and information sharing
  • Avoid supply chain costs (e.g. component buy-aheads, emergency second sourcing, expedited freight, etc.)
  • Reduce inventory
  • Improve supplier quality
  • Improve lead times and variability
  • Improve delivery/order fulfillment performance (on-time, variability)
  • Reduce number of supply crises impacting critical products or parts
  • Reduce incident response times and time-to-recover for the highest priority supply chain activities, products, and services
  • Improve supply chain asset utilization and inventory turns

Here’s some parting advice on developing your own list of strategic and tactical objectives. First, aim for strategic and tactical goals that are ambitious, yet achievable. Second, ensure program strategies drive or support C-level corporate strategies. Don’t forget to consider tactics that may be viewed as transformative (i.e. fundamentally change the way supply chain risk management processes are performed today). Make sure you package strategic objectives and tactics into a simple statement of purpose and goals that can be easily shared and understood. And, finally, position SCRP purpose and goals as complementary and accretive to existing enterprise risk programs.

To learn more about how to how to build out a global supply chain resiliency program (SCRP), check out the Ultimate Guide.

Proactive Supply Chain Risk Mitigation: The Brazil Drought & Impact

May 15, 2015 Posted by Uncategorized 0 thoughts on “Proactive Supply Chain Risk Mitigation: The Brazil Drought & Impact”

Author: Charlotte Hicks

Brazil-flag-drought-bcpRecently, Resilinc has been closely monitoring reports concerning Brazil’s severe drought. As we enter an El Niño in 2015, Brazil can expect drier weather for the next few months further exasperating the situation. While droughts may be a primary concern to farmers, there are also downstream impacts to the global supply chain in terms of water supplies, power supplies, and raw materials that could impact product customers.

Water Rationing Impact: All Markets

As supplies of waters dwindle, some cities are faced with severe water rationing. In São Paulo, the rationing is as severe as 5 days with no water (Ortiz, 2015). While we cannot accurately predict the exact impact, we can look at a similar situation that occurred in Malaysia last year (Bloomberg Business, 2014), where glove manufacturers were faced with cutting production or having water trucked in. The result was back orders on some cleanroom apparel items as well as price increases.

Risk Mitigation Strategy: Brazil is an exporter of therapeutics as well as automotive and electronic components. Planners should identify products manufactured in Brazil and potentially increase inventory levels and lead times temporarily.

Power Supply Impact: All Markets

Electricity can be generated in several ways such as natural gas, coal, and solar. In Brazil, the key source for power is hydroelectric, with over 70% of its electricity generated by hydroelectric dams (Johnson & Jelmayer, 2015). As the drought continues to strain water supplies, the power grid will also be strained resulting in potential blackouts and/or rationing. While many manufacturers have backup power, some downstream service providers may not.

Risk Mitigation Strategy:
All production sites who have subsidiaries, suppliers, and sub-tier suppliers in Brazil should review their suppliers’ Business Continuity Plans for information for information on their backup power capabilities. Keep in mind that while a business may have back-up power, other parts of the supply chain may not have back up power, such as third-party logistic hubs.

Raw Material Impact: BioPharma

Brazil is a major global exporter of agricultural products, such as corn, soy, and sugar- the primary building blocks in media and excipients. With the drought, harvests of these materials is expected to be lower than normal in the 2015 growing season. The good news is that an El Niño creates wetter and more favorable growing conditions in the US Midwest for stronger harvests of corn and soy.

But sugar on the other hand, is a tropical crop. The top producer of sugar globally is Brazil with India in second. Both countries are usually impacted negatively by an El Niño with lower sugarcane harvests. Right now, sugar prices are kept in check dues to excess sugar inventories (Hecht, 2015). However, the sugar harvests in Brazil are expected to be 9-10% lower than prior year (Lewis, 2014) and creates a price risk for BioPharm customers.

Risk Mitigation Strategy:  Commodities such as sugar, as well as corn and soy, are the building blocks for many materials media, amino acids, citric acid, ethanol, and excipients. BioPharm planners in particular need to be aware of the Brazilian drought situation and monitor back order reports for signs of tightness in sugar supplies as well as other components that can be impacted by an El Niño.

In summary, the drought situation in Brazil is extremely serious, and with the rainy season ending and an El Niño beginning, relief is not in the immediate future. While our hearts and thoughts are with those impacted by the drought, we can also help partners mitigate their raw material, water, and power constraints by being flexible and planning for bumps in their supply chain.


Read more about business continuity planning tools to mitigate supply chain risks here:

References

Bloomberg Business. (2014, April 15). Malaysian Glove makers Facing Production Halts on Water Cuts. Retrieved from Bloomberg Business: http://www.bloomberg.com/news/articles/2014-04-15/malaysian-glove-makers-face-production-disruption-on-water-cuts

Hecht, A. (2015). Sugar- a sweet commodity in a sour market. Seeking Alpha, http://seekingalpha.com/article/3001896-sugar-a-sweet-commodity-a-sour-market.

Johnson, R., & Jelmayer, R. (2015). Brazil Blackouts Spawns Power Rationing Fears. The Wall Street Journal World, http://www.wsj.com/articles/brazil-blackout-spawns-power-rationing-fears-1421784617.

Lewis, J. (2014). Fire and Drought Scar Brazilian Sugar Crop. Wall Street Journal, http://www.wsj.com/articles/fire-and-drought-scar-brazilian-sugar-crop-1411487285.

Ortiz, F. (2015, February 16). Brazil faces water rationing amid worst drought in 84 years. Retrieved from RTCC news: http://www.rtcc.org/2015/02/16/brazil-faces-water-rationing-amid-worst-drought-in-84-years/

Objections to Investing in Supply Chain Risk Management (Part 2)

April 23, 2015 Posted by Uncategorized 0 thoughts on “Objections to Investing in Supply Chain Risk Management (Part 2)”

Author: Wayne Caccamo

Obsolete_Supply_Chain_Risk_Management_ThinkingINTRODUCTION

In Part 1 of this blog post I discussed five of the six typical objections to supporting investments in supply chain risk management programs and I shared specific remedies. In this post I cover the last objection: Outmoded thinking and assumptions. To review the objectives and key points of Part 1, areas of investment resistance tend to be related to professional incentives, psychology, misperceptions about costs, and a lack of awareness and education. Understanding the role that each of these factors may play and being prepared to neutralize the resulting objections is key to moving your program forward. The first five objection categories discussed in Part 1 included (1) incentives and human nature, (2) dependence on supplier collaboration, (3) perceived cost of achieving supply chain visibility, (4) conflicting objectives, and (5) difficulty in valuing risk management. All objections are discussed in the Ultimate Guide to Supply Chain Resiliency Program Success in the broader context of building a complete business case for a supply chain resiliency program.

Perhaps the biggest challenge in modernizing an organization’s approach to supply chain risk management and resilience practices is overcoming the plethora of outmoded lines of thinking and outdated assumptions. There are several biases, attitudes, and dangerous assumptions underlying common supply chain practices that can devalue or not properly credit risk and resiliency measures. Here are some important myths to be aware of and have plan to address or contain.

The hero syndrome

Frequently there is a misplaced but abiding faith that “operations will always save the day with another extraordinary diving catch” and that the commodities team can “gut” their way through a problem. Even if this is the case, it’s a very expensive approach to risk mitigation.

“It’s better to be lucky than smart”

Another dubious refrain is “we got lucky that time” rather than recognizing that, more often than not, it was not pure luck that an impact was not felt, but the actions that somebody took to select a supplier located on higher ground or to find an alternate source. Identify the real (proactive) heroes and reward them.

The ostrich approach

Some supply chain stakeholders are under the impression that they can rely on their suppliers to address risk issues, financial, CSR/ethics, etc. in the sub-tiers. According to ChainLink Research, however, audit and regulatory visibility falls off after tier 2. There may be little awareness of the need to take an end-to-end approach which is a fundamental assumption of most supply chain resiliency programs.

The annual planning assumption

Supply chain risk management is treated like other strategic planning exercises, typically with an annual or at most semi-annual cadence. The reality is that risks are dynamic and constantly changing. You need a process the starts with this assumption.

Rearranging deck chairs

Many stakeholders believe that large disastrous events effect an industry equally. The thought is “we all got hammered and there was no way for anybody to escape the impact so why worry or do anything differently.” There is ample evidence that prepared firms are impacted less and recover quicker and can even use their resiliency to achieve competitive advantage.

Faith in randomness

There is also an assumption that risks are typically isolated and not interlinked. There may be little appreciation for how a resiliency program can ascertain how vulnerabilities that pop up in one area may be symptoms of wider and more systemic issues

The black swam misconceptions

Related to a faith in the randomness of events is the major pre-occupation with the so-called “black swan” events (i.e. infrequent disaster scenarios). This has two potential negative impacts to the perceived need to invest in a supply chain resiliency program. First, many believe these “acts of gods” by definition can’t be predicted and planned for, so preparation and mitigation is futile. Rather, these are frequently scenarios that catch supply chain professionals uninformed/unaware. There are in fact early warnings and information foreshadowing most events, yet most organizations have no access or visibility to that data. Second, these events distract from the focus that a resiliency program applies to the smaller, but almost daily, supply events that in aggregate have a larger business impact.

CONCLUSION:

It’s important to be aware of these myths and get ahead of them by talking openly about misconceptions and providing evidence to the contrary or rationale for the new, modern supply chain resiliency line of thinking.

New Metrics Needed to Meet Today’s Supply Chain Resiliency Challenges

May 16, 2014 Posted by Uncategorized 0 thoughts on “New Metrics Needed to Meet Today’s Supply Chain Resiliency Challenges”

Author: Jon Bovit

resilinc-globe

Today, every company is making spend-based decisions to ensure supply chain resiliency, but is that the right approach? Our experience suggests there is a very different way to look at supply chain resiliency – and a different set of analytics to ensure it. The new analytics are not spend-based. Rather, they are based on revenue impact.

The benefits of the new revenue-impact analytical approach are multi-fold. Using it, companies will have a clearer strategic view of what impacts their total revenue. And they will improve their financial risk assessments, not just for a limited segment of their supply chains but across many tiers of their public and privately-held suppliers. In short, they will develop more resilient, consistently reliable supply chains that can be measured and managed based on a wider range of spend and risk management metrics.

At Resilinc, we have witnessed the first stage of this evolution toward the new methods of supply chain measurement and management.

It’s no surprise that the Japanese earthquake and tsunami were a trigger event for the new analytical approach because they exposed the high tech sector’s vulnerability and spotlighted the supply chain’s weakest links. One of our high-tech clients, for example, took a big hit in the Japanese tsunami’s aftermath a few years ago. The disaster not only negatively impacted the company’s financial results, it also did longer-term damage that was harder to repair. Limited supply chain visibility led to shipment delays and a drop in customer satisfaction, and the inability to accurately quantify risks in the supply chain and determine where best to focus resources resulted in increased costs. This event and the aftermath were a “wake-up call” for our client’s senior executive team.

To protect itself against the potential impact from future disruptions, our client deployed Resilinc SupplyIntel and EventWatch to address supply chain mapping and business continuity planning challenges, support corporate social responsibility initiatives, and provide effective supply chain and financial risk assessment and mitigation.

SupplyIntel provides our client with a complete solution to map global supply chain across multiple tiers, identify critical supply chain dependencies, expose critical vulnerabilities and single points of failure, manage risk mitigation across the organization and optimize resiliency practices throughout the organization. EventWatch provides around-the-clock monitoring and detection of global events that threaten to disrupt supply chains worldwide. Resilinc monitors thousands of global news sources, identifies critical supply chain developments, and then filters, researches and notifies clients regarding potential supply chain threats. This intelligent filtering capability eliminates redundant notifications and reduces time spent on non-supply chain impactful events.

As a result, our client saw results within months of deployment. Among them, the company’s supply chain visibility improved after it was able to map parts, products and sites across its global supply base, and it lowered costs related to planning for and reacting to disruptions. In addition to helping supply chain managers to create and institute best practices companywide, SupplyIntel and EventWatch boosted the overall reliability of the company’s supply chain operations and, in turn, enabled it to serve customers more effectively.

What our client’s experience has shown us is that many other high-tech companies are grappling with the same kinds of issues. And, if the industry buzz about risk management being a top 2014 supply chain issue holds true, we’re likely to see an acceleration of the movement toward the new analytical approach to supply chain management resiliency.

Will you be one of the change-makers influencing how these evolving risk management best practices take shape?


Our new whitepaper, High Tech’s Next Big Supply Chain Undertaking, and our SupplyIntel & EventWatch Solution Brief provide a more detailed discussion regarding the need for new metrics for supply chain resiliency and reliability.

 


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