Spacious Potential in the Sharing Economy

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Photo by Pixabay on Pexels.com

By ASCM CEO Abe Eshkenazi, CSCP, CPA, CAE

The sharing economy is no longer just a catchy turn of phrase; today, sharing, renting and subscription services are everywhere. AirBnB for your holiday rental; WeWork for freelancers who prefer the office environment; Rover for the pup’s midday walk; Uber and Lyft when you need someone to drive you places; and Zipcar, LimeBike or Bird Scooters when you’d rather do the driving yourself. The potential applications are endless.

Although only 19 percent of U.S. adults have engaged in a sharing-economy transaction, PwC research reveals that 83 percent of survey respondents believe these services make life more convenient and efficient, 76 percent say they are better for the environment, and 43 percent admit that owning things can feel like a burden.

As ownership becomes unfashionable, the fashion industry is also taking notice.

“In October, the mall fixture [Express] launched Style Trial, a service that allows customers to borrow up to three pieces — with no limits on exchanges, free shipping both ways and free dry cleaning — for $69.95 per month,” writes Jasmin Malik Chua in Sourcing Journal. “If a subscriber loves something to death, she can buy it at a discount for keeps. Otherwise, she can keep garments circulating in an eternally refreshed ‘closet in the cloud’ with virtually infinite options yet zero commitments.”

Jim Hilt, Express executive vice president and chief customer experience officer, explains that this allows customers to tap the company’s “full assortment and styling services without breaking the budget.”

In addition to this kind of flexibility and cost savings, sharing clothes eliminates the hassle of shopping malls and the time spent packing bags for donation — not to mention all those minutes staring at our wardrobes trying to decide if an item still sparks joy.

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Shifting business models

Until very recently, most of us would never have considered staying in some random person’s home while on vacation, let alone sharing a sweater with a bunch of strangers. Yet today, Airbnb averages 425,000 guests per night — nearly 22 percent more than Hilton Worldwide.

“The data shows, renting and sharing are becoming increasingly popular alternatives,” the PwC report asserts. “Executives will be wise to assess the role of their product and brand in this model — are you squarely a purveyor of goods, or are you an enabler?”

For those supply chain managers bracing for change and facing some tough calls concerning clothing lifespans; quality control of shared garments; and logistics economics, especially for lower-cost items, there is some good news. The sharing economy is also flourishing in the education space, with LinkedIn Learning, Grow with Google, and a seemingly infinite number of instructive and informative videos on YouTube. Our own channel is bursting at the seams with customer success stories, webinars, research, annual conference sessions, and a multitude of supply chain education tailored to fit just right.

To join ASCM, joint membership is available through Australasian Supply Chain Institute for just $440 per annum. Visit our website for a full list of membership benefits.

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Indian regulations rain on Amazon and Walmart’s e-commerce parade

By ASCM CEO Abe Eshkenazi, CSCP, CPA, CAE

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Amazon and Walmart subsidiary Flipkart is scrambling to revamp its supply chains, vendor relationships and systems. New regulations from the world’s fastest growing economy have undermined these retailers’ business models and obstructed their sales in India’s burgeoning e-commerce sector.

Previously, foreign companies were forbidden from holding their own online inventory and shipping it directly to customers. Amazon had found a workaround in the form of local subsidiaries of firms in which it had holdings, which opponents insisted was violating the spirit of the rule. Largely due to such proxy sellers, Amazon and Walmart had controlled almost 80 percent of India’s e-commerce.

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But as of February 1, such goods are not permitted for sale by foreign companies. In addition, these firms are barred from entering into exclusive online sales agreements. A vendor’s inventory also will be considered under the control of an e-commerce marketplace if more than one-quarter of its sales are derived there.

The protectionist move follows ongoing complaints from domestic retailers over anticompetitive practices. Amazon and Walmart both requested a six-month postponement of the effective date but were denied.

“Thousands of products were pulled from Amazon.com Inc.’s India website Friday — the first direct impact from the country’s new e-commerce rules,” writes Corinne Abrams in the Wall Street Journal. The article goes on to explain that the restrictions are the latest effort by India to curb U.S. tech giants’ dominance in the country and “promote homegrown companies” as Prime Minister Narendra Modi seeks a second term.

“Both Amazon and Walmart have made big bets in India, where the e-commerce market is estimated to balloon to $72 billion in 2022,” Abrams adds. “Amazon has pledged to invest $5 billion to expand in [India], while Walmart’s takeover of India’s Flipkart for $16 billion was its biggest acquisition ever.”

Global supply chain know-how

The operations of these e-commerce giants have been thrown into disarray. As these companies, and others, navigate such severe regulatory pressure, success will hinge upon the effectiveness, responsiveness and flexibility of their supply chains.

ASCM provides the resources you need to plot your own course through the ever-shifting global marketplace. The APICS Certified Supply Chain Professional (CSCP) program enables individuals to master the fundamentals of supply chain strategy, business model design, relationship-building, risk management and much more. In particular, the CSCP learning system includes a module centered around monetary, regulatory and trade considerations; negotiation and collaboration; and international standards and compliance. Begin your journey toward this world-class certification today.

The Australasian Supply Chain Institute (ASCI) is the Premier Channel Partner for APICS and offers joint memberships with ASCI for local and ASCM for global membership for both corporates and individuals. Contact us today at http://www.asci.org.au/membership or enquiries@asci.org.au.

Climate Change Disruptors on the Rise

By ASCM CEO Abe Eshkenazi, CSCP, CPA, CAE

As I write this, the National Weather Service (NWS) is warning of severe cold here in Chicago, with wind chill temperatures expected to reach an excruciating 55 below zero. The NWS has even urged us to protect our lungs by minimizing talking and not taking deep breaths. Meanwhile, on the other side of the world, people in South Australia’s coastal capital of Adelaide are facing a different kind of lung injury — from dangerous air quality and ozone exposure. Adelaide recently reached 46.2 Celsius (nearly 116 degrees Fahrenheit), breaking a 130-year record.

When we talk about extreme weather statistics such as these, they are typically followed by warnings of disastrous sea levels, catastrophic Arctic ice decline, and life-threatening floods or hurricanes. “Not enough water to make Coke” and “sweltering Disney theme parks” do seem to pale in comparison. However, a recent Bloomberg article suggests that climate change will have a business impact that is devastating in its own way.

“Climate change is expected to cascade through the economy — disrupting supply chains, disabling operations and driving away customers,” author Christopher Flavelle writes, adding that numerous executives see “inherent climate-related risks with the potential to have a substantial financial or strategic impact on their business.”

Visit ASCI’s previous blog form Corporate Member – Nufarm – who utilises specific advanced analytics for predicting and planning for weather patterns.

One of the most commonly cited issues by company leaders is draught. Specifically, in addition to Coca-Cola fearing water shortages will threaten its bottling operations, Intel is concerned about escalating costs for the water-intensive process of semiconductor manufacturing.

Other professionals are kept up at night worrying about damage to their networks from hurricanes and wildfires (AT&T), global pandemics dissuading people from travel (VISA), and increased flooding and flood insurance premiums forcing mortgage holders to default on payments (Bank of America).

Interestingly, some organizations have identified opportunities amid the chaos, as climate change can “bolster demand for their products.” With more people facing illness, Merck & Co. sees the potential for “expanded markets for products for tropical and weather-related diseases,” Apple predicts disasters will make its iPhone “even more vital to people’s lives,” and Home Depot expects higher air conditioner and ceiling fan sales.

Sustainable supply chains

No matter where your company falls on the threat-versus-opportunity spectrum, climate change is altering the global economy immensely, and supply chains must transform to survive. At this time of both challenge and potential, ASCM is collaborating with a network of world-class organizations — including The Bill & Melinda Gates Foundation, Accenture, Deloitte and PwC — to create opportunities for the kind of supply chain innovation that will be mandatory in the coming years.

In addition, our new SCOR-Enterprise (SCOR-E) designation features an ecological dimension, which focuses on the circular economy, climate strategy, energy, water and waste, material usage, and product life-cycle stewardship. SCOR-E is the industry’s first and only corporate supply chain designation.

I hope you will make the most of these valuable member benefits. ASCM mission-driven strategic initiatives such as these draw on the power of supply chains to address pressing global issues and achieve the brightest futures for individuals, companies and communities.

For more information, please visit the ASCI website and select ASCI Plus Membership which include your local and global membership with ASCM.

Nufarm site visit generates sharing

As part of the ASCI Site Visit Series, ASCI arranged for 14 ASCI Members to visit the Nufarm Raymond Rd manufacturing facility on Friday 25 January 2019.

Both nbn Co and Nufarm are ASCI Corporate Members, and within the ASCI Corporate Membership package, comes the benefit of sharing and learning within the network.

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Site Manager, George Fletcher gave the group an introduction to Nufarm and the site, see picture.

According to Angus Borland, Supply Chain Planning Manager – ANZ, Nufarm, the group enjoyed the balmy 44 degrees for a walk through a number of the production lines, followed by a planning discussion he led alongside two site planners (Michael Buttigieg-Raymond Rd and Matt Calabro-Pipe Rd).

“This was a good 2-way discussion between Nufarm and nbn Co,” Angus recalls.

Ryan Jones, Manager Integrated Demand Planning, nbn Co agrees. “The two organisations couldn’t be further apart in terms of industry. However, there were so many similarities both in forecasting and planning systems; S&OP processes; safety; and challenges such as demand accuracy and the management of inventory,” he said.

“In addition, we could really appreciate the weather challenges faced by the organisation and were impressed with Nufarm’s long term strategies and predictive analysis.”

There were some key areas identified where a visit to non Co could benefit the Nufarm demand planners. Hence, the sharing and learning process is in motion!

Look out for more events within the ASCI Site Visit Series, held all over the country in 2019!

 

Top five supply chain podcasts of 2018

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Australasian Supply Chain Institute has reviewed podcasts interviews all over the globe to bring you the very best for your listening pleasure over the holiday break:

1.The Future of Work

Jacqui Canney, is EVP and Chief People Officer at Walmart and Clay Johnson, is EVP and Chief Information Officer at Walmart.

Jacqui is focused on the development, the retention and the rewarding of their 2 million employees. Clay is charged with putting ICT and HR together to create more productivity and automation. Walmart is the world’s largest employer with 5000 stores in the U.S and 10,000 globally.

Duration: 1 hour

ASCI review: An unbeatable interview on how Walmart is evolving and using tech to train and up skill their workforce; how they are using Blockchain to track food; what the future of Walmart looks like 5-10 years out. An interview just darn worth your time. 

2. ASCI Lounge

Daniel Kohut, Director, Solutions Advisor at JDA, shares his sales and operations planning expertise starting from his Australian career pathway, to the present day and the importance of professional development for supply chain experts in the midst of an era of digitisation transformation.

Duration: 20 minutes

ASCI review: So great to hear the Aussie accent and someone so passionate about the future of supply chain careers. Some good advice for professional development. 

3. Talking Logistics

Scroll straight to Episode 6: Angie Freeman, Chief Human Resources Officer, CH Robinson shares insights and ideas on the importance of recruitment and talent in the supply chain industry.

Duration: 29 mins

ASCI review: Best take on articulating the challenges in a succinct interview.

4. Supply Chain Now

Sandra MacQuillan serves as the Senior Director of Supply Chain Strategy & Transformation for Kimberly-Clark, where she leads company’s global supply chain, with responsibility for procurement, logistics, manufacturing, quality, safety, and sustainability.

Amy Gray serves as HR Director for Global Supply Chain at Kimberly-Clark. Amy has served in a variety of HR-related roles at K-C over the last 12 years, to include HR Business Partner and HR Project Leader.

Duration: 1 hour

ASCI review: Jump to 18 minutes in..the first part is just chatter. Interesting take on diversity to better represent customer profiles and global reach.

5. ASCI Lounge

Indrasen Naidoo, Director, Supply Chain System Transformation, Roy Hill (a 55 mega tonne per annum iron ore producer in Western Australia), joins us on the ASCI Lounge to reflect on Roy Hill’s roadmap for Intelligent Supply Chain for Assets, highlighting the need for leadership capacity; rethinking flows; and applying expert technology.

Duration: 20 minutes

ASCI review: Some salient points on how supply chain in Australia is stuck in traditional programs and what Roy Hill has done to move the dial. 

Enjoy your holiday podcast listening!

ASCI Lounge is Australasia’s supply chain podcast channel with over 3,500 downloads since 2016. To book an interview, or to join a panel discussion on a particular topic, email the ASCI National Office at enquiries@asci.org.au

ASCI National Office is closed from Friday 21 December however, you can purchase Guided Learning registration right up until 6 January 2019. For more information, visit: www.asci.org.au/education 

Monique Fenech is the host of the ASCI Lounge podcast channel.

 

 

 

ASCI members enjoy lessons in surviving and thriving in Australia’s manufacturing industry

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Site Visit Report by Geoff Palm
When Sten Campbell, Director, designtech, and his wife bought the business 25 years ago they had no idea about making furniture. Thanks to the help from a mentor and competitor in Sydney, they began the journey to where they are today; one of the leading manufacturers of MTS and MTO furniture manufacturers in Australia.
They have both local and national customers and compete effectively with imported products. One of designtec’s advantage is in quality, with a 10 year guarantee on all their products. They have not had a single claim against their product since this warranty was put in place. Another advantage is their speed to market; being able to deliver orders within 2 weeks. In fact, they recently helped out a Fitout company that was in trouble due to a delayed overseas shipment and late completion penalties approaching.
designtec has invested in state of the art German machinery, which is in part, one of the reasons they are so competitive. We watched one machine in action that cut, trimmed and edged a tabletop in minutes. This used to take 2 tradespeople up to 3 hours each to complete in the past. It was fascinating watching the journey of the product from raw material to finished product; created by a combination of people and machine. Staff skill levels range from tradespeople to semi-skilled; with a strong focus on cross-training. This ensures that most people in the business can operate a range of equipment; allowing for flexibility when demand dictates.
Safety is another important factor in designtec’s success; with no LTIs in the last 5 years.
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Most of there employees are now long term; with some coming up to 20 years. This was not the case during the mining boom when Western Australia struggled to find qualified people and it was the same with designtec; growing at 30% a year. That all changed in 2008 with the GFC and then the end of the mining boom, which saw demand for their product diminish rapidly. It is to the owners credit that not only did they survive, met the challenge they faced and have prospered since the downturn.
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The visit was hosted by Sten and Hannah Witherick, General Manager, on the afternoon of July 24, ASCI and associates learned the commercial, technical, industry and logistics issues around the designtec business.
ASCI WA thanks designtec, Sten Campbell, Hannah Witherick and other staff for hosting this visit and openly sharing their stories with our members. We must also not forget the office dog, who shared her love with all in a quiet and dignified manner. – end

Why good leaders make you feel safe

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What makes a great leader? Management theorist Simon Sinek suggests, it’s someone who makes their employees feel secure, who draws staffers into a circle of trust.

But creating trust and safety — especially in an uneven economy — means taking on big responsibility. We’ve discussed this all important topic for ASCI members in a recent blog The Seven Tests of True Mastery. As supply change practitioners, we are accurately aware that our industries are certainly not immune to change, making our teams feel vulnerable and stressed. How do we support them?

ASCI members took the opportunity this week to attend the ASCI Networking evening which was live streamed on our closed Facebook page, ASCI Members, to hear what they needed to know about redundancy, redeployment and career transition and how they could make their teams feel safe and secure amidst a domain of disruption and change.

Expecting to hear the doom and gloom of unemployment, members were pleasantly surprised to hear that the top organisations in Australia are offering the very best outplacement services for employees experiencing redundancy or redeployment.

Four Fast facts

  1. Most employees will experience seven workplace changes
  2. Most employees will experience an estimated three redundancies
  3. Four out of five medium to large organisations globally utilise outplacement
  4. It is estimated 44% of jobs in Australia will be at risk due to developing technology.

According to Brendan O’Keeffe, Nova Partners, career transition is inevitable for all of us and supply chain managers will benefit from learning as much as they can about outplacement services and best practice during a restructure.

Brendan shared the Automotive industry as a best practice case in point, clearly one which is close to ASCI Members’ hearts. In particular, Toyota was presented as an example of a company which has excelled in communicating with employees about the restructure changes in the organisation from the very top of the organisation chart – giving employees full transparency to opportunities on offer, managers who they’d report to and locations in which to relocate.

Career transition consultation was made available to those choosing to move on – some to the most unlikely careers such as professional golfing and entrepreneurial ventures.

Information sharing and advice on roles and responsibilities was sought after employees by management, making employees feel like their tenure made a significant impact to the organisation.

The two year outplacement transition has made all employees at Toyota feel valued and motivated by the changes to the organisation, regardless of the outcomes for the individuals. This is a brand dream for most organisations.

However, Brendan O’Keeffe says many SME companies say outplacement services are a luxury they cannot afford, leaving employees without the support they require during restructures. In leui of this service, supply chain managers are forced to upskill and learn best practice ways to look after their teams during transition.

For more information about outplacement services and career transition, please contact ASCI Corporate Member, Brendan O’Keeffe at Nova Partners: bokeeffe@novapartners.com.au.