The Tragedy of Deforestation in Our Global Supply Chains
Forests are not only a vital resource for maintaining a healthy and stable climate, but they also provide numerous ecosystem services such as biodiversity conservation, soil conservation, and water regulation. However, supply chains that rely on unsustainable practices are a major threat to the world’s forests. This BBC video emphasizes that immediate action is needed to address the drivers of deforestation and promote sustainable supply chains.
Tenth Anniversary of the Rana Plaza Disaster
Ten years ago, on April 24, 2013, the world was shocked by the collapse of the Rana Plaza building in Bangladesh. The tragedy claimed the lives of 1,134 garment workers and injured thousands more. The building housed several garment factories that supplied clothing to major global brands. Rana Plaza highlighted the dominant supply chain logic: that a T-shirt can only be sold at a very low price at the downstream end of the supply chain because the real cost is paid by the workers at the upstream end, who sacrifice their health or even their lives. In the aftermath, many apparel brands committed to improving working conditions in their supply chains. Yet, progress has been slow and uneven. Ten years on, there is still much to be done to ensure that garment workers are treated fairly and with dignity. As we remember the victims of the Rana Plaza tragedy, we, supply chain academics, have a crucial role to play in the transformation of fashion supply chains.
Circular Supply Chain Transformation
We have just released a new report, entitled Circular Supply Chain Transformation: Challenges, Opportunities, and Trade-Offs for Circular Smartphones and Computers. It highlights the importance, opportunities, and potential trade-offs associated with circular supply chains for electronic devices in a way that makes it easier for decision makers to understand and navigate the circular transformation. Importantly, the report emphasizes that everyone – from manufacturers and purchasers to distributors, recyclers, and policy makers – has a role to play in the transformation toward circular devices, and that it is possible to implement many of these circular initiatives in a way that reduces the environmental, social, and economic costs of electronic devices. By providing concrete examples and societal reflections, the report serves as a foundation and guide for decision-makers who want to reduce the negative impact of their electronic devices. The report is a result of the Reimagining Supply Chains Initiative – a collaborative research effort between Copenhagen Business School, Nordakademie, and Nordakademie Foundation.
The Dark Side of the Cobalt Supply Chain
Cobalt Wars is one of the most interesting ARTE.tv documentaries I have seen recently. It looks at the supply chain of cobalt, a key ingredient in the batteries of our smartphones and electric cars, and the political, environmental and social challenges associated with that supply chain. (French with English subtitles, also available in German. Not available in all regions.)
Accelerating the Path to Net-Zero Supply Chains
The “No-Excuse” Framework to Accelerate the Path to Net-Zero Manufacturing and Value Chains is a new white paper that aims to provide businesses with the information they need to operationalize their commitments to reducing carbon emissions and addressing the climate crisis. The framework is intended to be a central tool for the World Economic Forum Industry Net Zero Accelerator initiative, which is designed to bring together leaders across industry sectors, academia, government, and civil society to jointly shed light on global insights and best practices for reducing emissions. The framework is divided into four stages: (1) build the foundations, (2) change the game internally, (3) drive systemic collaboration, and (4) make it simple, inclusive and exciting. Each stage of the framework consists of a combination of research-based insights, well-established action areas, and emerging themes. The goal of the framework is to be applicable across key industries and geographies. This white paper is the first output of the Industry Net Zero Accelerator initiative and further resources are available for chief executive officers at the Alliance of CEO Climate Leaders.
Personal Predictions for Supply Chain Management in 2023
As in previous years, I am making a prediction about what could be important topics in supply chain management research. Here are three predictions: (1) OpenAI has demonstrated the incredible potential of machine learning, and this will have numerous implications for the management of supply chains. It is important for our discipline to consider the potential and drawbacks of this technology at an early stage. (2) Supply chain resilience remains a critical issue. For example, the recent resurgence of Covid-19 cases in China could lead to the closure of ports and factories, which would disrupt global supply chains. This topic will continue to be relevant in the future. (3) The climate and biodiversity crises continue to worsen, and their solutions are closely tied to supply chains. Human-caused emissions and the destruction of rainforests are directly related to supply chains, and new laws, such as those in Germany and the EU, reflect this. I wish you all a Happy New Year 2023.
OpenAI and Its Impact on Supply Chain Management
OpenAI has attracted a lot of attention in recent weeks, and for good reason. The research institute, which focuses on developing artificial intelligence technologies and promoting their safe and responsible use, has made significant strides in advancing the field of AI. One area where OpenAI could have a significant impact is in the field of supply chain management. The ability to analyze large amounts of data quickly and accurately could be useful for optimizing supply chain processes, identifying inefficiencies, and making more informed decisions. However, there are also potential drawbacks to the use of AI in supply chain management. There is a risk that the technology could be used to automate jobs and potentially displace human workers. There are also concerns about the ethical implications of using AI in decision-making, such as the potential for bias in the algorithms that drive the technology. Overall, the use of AI in supply chain management has the potential to be both beneficial and detrimental. It is important for researchers and educators in this field to carefully consider the potential impacts of this technology and to develop strategies for addressing the challenges it presents. This blog post was generated using ChatGPT, a chatbot platform developed by OpenAI.
The Threat to Supply Chains from Rising Gas Prices
Due to the Russian invasion of Ukraine, the European Union is currently experiencing a massive increase in gas prices. This threatens the resilience of many supply chains. An analysis by the Halle Institute for Economic Research (IWH) now shows that a small group of just 300 products causes a large part of almost 90% of the gas consumption of German industry during their manufacture. The five products with the highest gas consumption per euro of sales belong to the basic chemical industry. The analysis also shows that rising gas prices mainly lead to production cutbacks in gas-intensive products that can easily be replaced by imports. Therefore, despite domestic production outages, no significant disruptions to the supply chains are to be expected. “German industry can save a lot of gas with a small drop in sales if gas-intensive products are no longer manufactured in-house but imported,” says Steffen Müller, one of the authors of the analysis.
Supply Chain Resilience 2022
This year Raconteur has once again put together a very readable report entitled Supply Chain Resilience 2022. The authors ask, “As disruption continues to plague international supply chains, what can organisations do to build resilience and ensure efficiency?” And they provide answers: “From reducing waste and cutting costs to onshoring and upgrading systems, our Supply Chain Resilience report explores the strategies making the difference”. The report contains short articles on very interesting topics including Brexit, predictive analytics, striking staff, supply chain tech investments, just-in-time vs. just-in-case, chip crisis, robotics, food waste, air cargo, and sustainable commerce. I particularly enjoyed an article that shows how global supply chains have been rocked by climate change, geopolitical instability and more, and that provides examples of different industries adapting to these challenges. It is not the first time that I am writing about Raconteur’s reports here. I am always amazed at the high quality of their work.
Solar PV Global Supply Chains
The International Energy Agency has just released a new special report entitled Solar PV Global Supply Chains. It examines solar PV (= photovoltaic) supply chains “from raw materials all the way to the finished product, spanning the five main segments of the manufacturing process: polysilicon, ingots, wafers, cells and modules”. The authors argue that “[p]utting the world on a path to reaching net zero emissions requires solar PV to expand globally on an even greater scale, raising concerns about security of manufacturing supply for achieving such rapid growth rates – but also offering new opportunities for diversification”. It becomes clear from the report that China currently dominates such supply chains and that diversification can reduce supply chain vulnerabilities and offer economic and environmental opportunities. According to the authors, policy makers need to aim for (1) diversifying manufacturing and raw material supplies, (2) de-risking investment, (3) ensuring environmental and social sustainability, (4) continuing to foster innovation, and (5) developing and strengthening recycling capabilities.
