Mapping the Cobalt Supply Chain
Cobalt has become a key commodity for battery-powered vehicles and other electronic products. The Democratic Republic of Congo is the largest producer of cobalt. The so-called “Copperbelt” in the southeastern part of the country hosts most of the cobalt ore, mainly extracted through large-scale industrial mining but also through artisanal and small-scale mining activities by more than 100,000 miners. The sector faces numerous sustainability challenges within local supply chains, such as child work and other human rights violations. The Federal Institute of Geosciences and Natural Resources from Germany has now published a report, titled Mapping of the Artisanal Copper-Cobalt Mining Sector in the Provinces of Haut-Katanga and Lualaba in the Democratic Republic of the Congo, which analyzes the cobalt supply chain in the Congo. The focus of the mapping lay on the beginning of the supply chain, i.e. from the cobalt ore to the first domestic sale of production, which is often overlooked by Western consumers and users.
The Avocado Supply Chain
Among the best ways to teach supply chain management is by discussing different types of real-world supply chains. In their interesting report, Enabling Trade: From Valuation to Action, the World Economic Forum (in collaboration with Bain & Company) present several supply chains that could be discussed. The introdution makes one point clear: “The overall benefits to nations, producers and consumers are clear. However, making it happen is not as simple – particularly because supply chains cut across multiple stakeholders, requiring collaboration and leadership that goes beyond local constituents and borders.” This is where the report delves deeper into examples of practical application. Among the examples presented in the report is the avocado supply chain. This example demonstrated how “a number of supply chain improvements have enabled Kenyan avocados to be profitably exported to high-value markets in the European Union”. It illustrates that supply chains “must be able to react to changes in market dynamics in order to maintain a virtuous cycle”.
The Dark Secret of the Chocolate Supply Chain
We cannot spare our students the dark secrets of supply chain management. As future decision makers, they need to understand the social and ecological consequences their decisions might have somewhere else on this planet. The chocolate supply chain is a perfect illustration of the complex relationships between consumerism, supply chain management, value creation, and ethical consequences. I have been using this example in my SCM courses for years. So, what is the impact of chocolate? The environmental group Mighty Earth has recently published an investigation into deforestation caused by chocolate: Chocolate’s Dark Secret. Their team visited several protected areas inside Ivory Coast and found that illegal cocoa production has entirely overtaken areas that had been covered by rain forests in the past. Particularly, they found that the world’s largest chocolate companies are connected to cocoa from sources linked to illegal deforestation. The report illustrates how cocoa moves through the supply chain and how value is created in the chocolate industry.
Vanilla Sourcing in Madagascar
In a previous post, I demonstrated how Symrise creates added value beyond corporate boundaries by closely collaborating with vanilla farmers in Madagascar. Watch the following video, which highlights this approach from the perspective of Unilever, a buyer of Symrise’s aromatic compounds. The case is also included in an article I have written for Supply Chain Management Review about the interface between SCM and CSR.
Logistics and Supply Chain Management in Africa
A Moral Revision of Electronic Supply Chains (Guest Post by Bas van Abel, Fairphone)
To make the supply chain more transparent, Fairphone opens up the entire system to understand what shapes our economy. I am happy to share the following guest post by Bas van Abel, CEO and founder of Fairphone. Thank you for contributing to my blog.
Business practices in the supply chains of the electronics industry are in urgent need of moral revision. What do we know about the production of complex electronic devices and the people who make them? By making a phone, Fairphone wants to uncover and expose each link in the supply chain and step-by-step make interventions to improve the way things are made. Instead of hiding behind the complexity of the supply chain, Fairphone wants to unveil the problems associated with the smartphone production like poor labor conditions, the use of conflict minerals and the rise in electronic waste. To do so, we are searching for solutions by engaging in partnerships to come with alternatives to current models. In the first Fairphone that will be released in December 2013, conflict-free tin and tantalum from the Democratic Republic of the Congo has been integrated in the manufacturing of the phone, but that’s only a first step. By growing a movement of people who can share best practices and by creating a platform for discussion, Fairphone aims to raise the bar for the industry meanwhile giving people a choice for fairer electronics.
Bas has a background in interaction design and is an active member of the Maker Movement. He supports open design principles. He has set up projects such as the Waag Society’s Fablab and the Instructables restaurant (an open source restaurant). He is co-editor of the book “Open Design Now”.
World Food Programme’s Humanitarian Supply Chains
As part of the Kühne Foundation’s certificate program on humanitarian logistics, I have, again, been teaching logistics and supply chain management modules in East Africa during the last couple of weeks. This year, the program was held at the University of Dar es Salaam and the National Institute of Transport in Dar es Salaam, Tanzania, as well as at Makerere University Business School in Kampala, Uganda. A new report, recently published by the World Food Programme (WFP), gives a good real-life overview of humanitarian logistics. Particularly, it demonstrates how WFP (1) deliver goods, how they (2) assist the humanitarian community, (3) innovate supply chain management, (4) develop capacity, and (5) partner with other organizations. WFP’s logistics strategy, “Driving the Supply Chain”, includes four priority areas: Emergency Preparedness and Response, Controls and Risk Reduction, External Service Provision, and Food Assistance Initiatives. It becomes apparent that humanitarian and commercial supply chains are highly interlinked and can learn from each other.
Creating Added Value beyond Corporate Boundaries
Some months ago, Symrise, a global supplier of fragrances, flavors, active ingredients, and aroma chemicals, has won the German Sustainability Award 2012 in the “Germany’s Most Sustainable Initiatives” category for its approach to procure vanilla in Madagascar: Symrise closely collaborates with more than 1,000 vanilla farmers and “the entire procurement process takes place locally, from cultivation and harvesting, to the fermentation of the beans, all the way through to extraction”. The company partners with NGOs, development organizations, and farmers’ associations to ensure “that its projects in the areas of environmental protection, income diversification, nutrition, health and education continue to blossom over the long term”. Symrise benefits from these activities by receiving reliable access to top-quality raw materials. This initiative demonstrates how social responsibility, environmental protection, and business success can go hand in hand. It is also an example of good supply chain management, as added value is created beyond corporate boundaries.
Africa Logistics Initiative
The Kühne Foundation invited me to support its Africa Logistics Initiative. Consequently, I have spent the last weeks teaching in logistics and supply chain management at the National Institute of Transport in Dar es Salaam, Tanzania. It has been a great experience.
