admin, Author at LMA-Consulting Group, a supply chain consulting firm https://www.lma-consultinggroup.com/author/admin/ Fri, 05 Apr 2024 22:12:31 +0000 en-US hourly 1 https://wordpress.org/?v=6.5 The Minimum Wage Hike, Cocoa Shortages, Egg Inflation & Impacts https://www.lma-consultinggroup.com/the-minimum-wage-hike-coca-shortages-egg-inflation-impacts/ https://www.lma-consultinggroup.com/the-minimum-wage-hike-coca-shortages-egg-inflation-impacts/#respond Fri, 05 Apr 2024 21:59:28 +0000 https://www.lma-consultinggroup.com/?p=23731 California's minimum wage went up to $20/hr. for fast food restaurants with at least 60 locations nationwide that do not make bread. This law is causing widespread unintended consequences. For example, Fosters Freeze in Lemoore closed suddenly after the wage hike. Mod 5 Pizza is closing five locations.

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Supply Chain Briefing

The Minimum Wage Hike, Coca Shortages, Egg Inflation & Impacts

The Minimum Wage Hike

California’s minimum wage went up to $20/hr. for fast food restaurants with at least 60 locations nationwide that do not make bread. This law is causing widespread unintended consequences. For example, Fosters Freeze in Lemoore closed suddenly after the wage hike. Mod 5 Pizza is closing five locations. There are widespread price increases including at In n Out, Burger King and more. Significant layoffs are also occurring at restaurants like Pizza Hut, Round Table Pizza, and Auntie Anne’s as companies determine how to deal with the wage hikes while maintaining profit levels. Some franchise owners are “on the move” to states with less regulation such as Nevada. It will also negatively impact manufacturing and supply chain as companies compete for resources and increase prices. The Skills Gap and misalignment of high-skilled and low-skilled jobs will worsen.

More Shortages & Sky High Prices…..NOT Chocolate!

The price of cocoa has doubled in the last year. After three years of poor cocoa harvests with a weak outlook, the supply of cocoa has been slashed. Thus, prices are escalating and shortages are becoming widespread. Processing plants are saying they cannot afford to purchase the beans. For example, 60% of the world’s coca is produced in Africa’s the Ivory Coast and Ghana, and these plants have stopped or cut processing. Unfortunately, there is a massive misalignment of demand and supply which is creating supply chain shortages and causing inflationary pressures. In addition, substitutes are starting to occur. To read more about persistent shortages, see our article, “Supply Chain Shortages Remain a Concern“.

Egg Inflation

The largest producer of fresh eggs, Cal-Maine Foods, Inc. temporarily shut down one of its facilities due to the bird flu. It also resulted in the depopulation of 1.6 million hens. These issues are bound to lead to further price increases. Egg prices increased over 8% in the last month, have more than doubled since before the pandemic, and are bound to go even higher as potential shortages loom. What is the bottom line? Supply and demand misalignment is creating havoc throughout the supply chain.

It Isn’t All About Food

Oil and gas prices are increasing again, which will have an impact on countless products from medical devices to electronics and industrial machinery. Since the supply chain has been thrust into chaos throughout the world (listen to our recent Supply Chain Chats on what’s going on in the global supply chain), container shipping rates are increasing. And after the recent bridge collapse in Baltimore, the automobile supply chains have been disrupted, and it is likely to lead to inflationary pressures. No matter the product, supply chain risks have been heightened.

How to Navigate

Unfortunately, there is no easy answer and magic wand to resolve the shortages and realign demand with supply. On the other hand, the focus of SIOP (Sales Inventory Operations Planning) is to align demand with supply and provide the visibility and insights to proactively navigate these rough waters. For example, clients are reallocating capacity among production facilities, making make vs buy decisions, offloading to supplement short-term spikes in demand, and maximizing customer and product profitability with a SIOP process. To learn more about these strategies, download our complimentary book, SIOP: Creating Predictable Revenue and EBITDA Growth.

In addition, there is no doubt the proactive clients are finding ways to leverage ERP systems and advanced technologies to automate, digitize and better navigate these trying circumstances. For example, a healthcare products manufacturer is using artificial intelligence and robotics to produce standard product with minimal resources so that they can dedicate their high-skilled talent to their complex product lines supporting aerospace and defense. Another client is pursuing additive manufacturing/ 3D printing to get a leg up on the competition and bring down lead times to support growth plans. There is plenty of opportunities if you look for them!

If you are interested in reading more on this topic:
How Do You Rate in Your Supply Chain?

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PYMNTS: Supply Chain Chaos Threatens East Coast After Baltimore Bridge Collapse https://www.lma-consultinggroup.com/pymnts-supply-chain-chaos-threatens-east-coast-after-baltimore-bridge-collapse/ https://www.lma-consultinggroup.com/pymnts-supply-chain-chaos-threatens-east-coast-after-baltimore-bridge-collapse/#respond Wed, 03 Apr 2024 05:33:34 +0000 https://www.lma-consultinggroup.com/?p=23727 When supply chains run smoothly, the economies they support do too. But when even the smallest disruption occurs, supply chains can quickly turn into the equivalent of a daisy chain — where one event sets off a cascading impact down the entire logistics value chain. Experts fear that this is what could happen up and [...]

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When supply chains run smoothly, the economies they support do too.

But when even the smallest disruption occurs, supply chains can quickly turn into the equivalent of a daisy chain — where one event sets off a cascading impact down the entire logistics value chain.

Experts fear that this is what could happen up and down the East Coast as businesses and shippers try to manage the fallout from the March 26 collapse of Baltimore’s Francis Scott Key Bridge as a result of a cargo ship collision.

“The impacts to the local region will be significant for several months or years until the bridge is rebuilt,” Lisa Anderson, founder and president of LMA Consulting Group, told PYMNTS in an interview. “Even once the port is reopened, trucks will continue to be re-routed around Baltimore, adding time and cost to trips from the port and through the Baltimore area.”

The Port of Baltimore itself remains closed to ships moving in or out until further notice, and officials are now faced with the task of removing the thousands of tons of steel and concrete clogging Maryland’s Patapsco River, while at the same time navigating the logistics of rerouting Baltimore-bound ships to other ports up and down the eastern seaboard.

The U.S. Coast Guard opened a temporary alternate channel Monday (April 1) for vessels that are helping with the cleanup effort.

“The most critical timeframe is clearing the bay to reopen the port, which could take weeks,” Anderson said. “This will impact the ninth biggest port in the U.S. and 3,200 sites involved in logistics, distribution and warehousing nearby the port and bridge as well as local businesses.”

 

Read more at PYMNTS site.

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LA Times: How will the Baltimore bridge collapse affect prices and the West Coast https://www.lma-consultinggroup.com/la-times-how-will-the-baltimore-bridge-collapse-affect-prices-and-the-west-coast/ https://www.lma-consultinggroup.com/la-times-how-will-the-baltimore-bridge-collapse-affect-prices-and-the-west-coast/#respond Mon, 01 Apr 2024 22:38:24 +0000 https://www.lma-consultinggroup.com/?p=23709 The closure of the Port of Baltimore this week could have far-reaching implications all the way across the country for the ports of Los Angeles and Long Beach, according to several experts including Lisa Anderson of LMA Consulting Group.

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The collapse of the Francis Scott Key Bridge and the closure of the Port of Baltimore this week could have far-reaching implications all the way across the country for the ports of Los Angeles and Long Beach, according to several experts.

The bridge collapsed Tuesday about 1:30 a.m. when the Dali, a 985-foot-long cargo ship en route to Sri Lanka, crashed into one of the bridge’s support pillars shortly after losing power. It sent a majority of the bridge plummeting into the 50-foot-deep Patapsco River below, claiming the lives of at least two construction crew workers on the bridge; four others are missing and presumed dead.

In the short term, the closure of the Baltimore port will increase costs for businesses and consumers on the East Coast, said Lisa Anderson, founder of LMA Consulting Group, which specializes in supply chains and manufacturing. That’s because the container ships on their way to Baltimore will be diverted to nearby New Jersey, Pennsylvania and Virginia ports, and the products they’re carrying will have to change the arrangements previously made to be transported to wherever they need to go, Anderson said.

The closure will also affect warehouses and other logistics services, which will have to decide whether they want to switch to other facilities while officials work on reconstructing the bridge and reopening the port, Anderson said. Trucks will also have to be diverted from the Key bridge, meaning they’ll either have to go around the city or pass through tunnels, which have height, width and hazardous materials restrictions.

Longer term, ports in Los Angeles and Long Beach could see more activity, especially with drought conditions reducing the capacity of the Panama Canal, Anderson said. The shipping route from northeast Asia through the Suez Canal and to the East Coast of the U.S. has also become perilous because of the war in Gaza. The Iran-backed Houthis in Yemen have been attacking commercial ships going through the Suez Canal, resulting in shipping lines having to divert their vessels around the southern tip of Africa.

What that means is that the ports of Los Angeles and Long Beach will see an increase of volume, translating to more activity for trucking companies as well as for warehousing and rail systems, Anderson said.

“That’s a positive, but we also need to make sure it’s not gonna become a new bottleneck,” she said. “These folks are adding time to their orders so they have to find new routes and we wanna make sure we’re prepared to service this additional volume.”

The closure of the Baltimore port could also lead to a “nominal” uptick in costs for the products that typically arrive there, such as cars and light trucks, Anderson said. The costs of diverted transportation will eventually be passed on to customers, but it’s not expected to be significant across the U.S., she said.

Read more at the LA Times

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How Baltimore’s Key Bridge collapse will affect supply chains and the economy https://www.lma-consultinggroup.com/how-baltimores-key-bridge-collapse-will-affect-supply-chains-and-the-economy/ https://www.lma-consultinggroup.com/how-baltimores-key-bridge-collapse-will-affect-supply-chains-and-the-economy/#respond Sat, 30 Mar 2024 03:35:50 +0000 https://www.lma-consultinggroup.com/?p=23699 The Francis Scott Key Bridge now lies partially submerged in the Patapsco River after a catastrophic cargo ship collision this week. Here’s how the Key Bridge collapse may affect the port’s operation.

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The Francis Scott Key Bridge, once the second-longest continuous truss bridge in the U.S., now lies partially submerged in the Patapsco River after a catastrophic cargo ship collision this week.

“Will this Baltimore situation add a bunch of cost to the global supply chain? Well, no,” said Lisa Anderson, president of LMA Consulting Group. But with additional global complications, costs could compound.

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The Francis Scott Key Bridge, once the second-longest continuous truss bridge in the U.S., now lies partially submerged in the Patapsco River after a catastrophic cargo ship collision this week.

Two people were injured, and six others presumed dead. The ship and mangled debris from the bridge have formed a wall in the water, indefinitely blocking access in and out of the Port of Baltimore, the top domestic port for cars and a major hub for other goods, such as forest products, farm equipment and sugar.

Among the questions around what happens now is what the accident means for shipping and the economy.

The port handled a record amount of cargo last year. While President Joe Biden has said he intends for the federal government to rebuild the bridge, and called on Congress to support that effort, the port is directly responsible for about 15,000 jobs and generated $4.7 billion in economic value to the state of Maryland.

The bridge’s collapse stranded at least 10 vessels in the water and ships outside the blockage have had to reroute to other East Coast ports, such as Norfolk and New Jersey. For global shipping, this comes at a time when companies are contending with route disruptions along the Suez and Panama canals.

Here’s how the Key Bridge collapse may affect the port’s operation, the local economy and international supply chains.

  • What role does the Port of Baltimore play?
  • How long will shipping be suspended?
  • Will supply chains be interrupted?
  • What are potential long-term effects?
  • What about local and regional effects?

Read more at PBS News Hour site.

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Lisa Anderson, Supply Chain Expert Discusses Ripple Effects of the Francis Scott Key Bridge Collapse on Global Supply Chains https://www.lma-consultinggroup.com/lisa-anderson-supply-chain-expert-discusses-ripple-effects-of-the-francis-scott-key-bridge-collapse-on-global-supply-chains/ https://www.lma-consultinggroup.com/lisa-anderson-supply-chain-expert-discusses-ripple-effects-of-the-francis-scott-key-bridge-collapse-on-global-supply-chains/#respond Thu, 28 Mar 2024 14:03:22 +0000 https://www.lma-consultinggroup.com/?p=23704 Lisa Anderson emphasizes the profound and wide-ranging impacts on global supply chains. The bridge’s destruction not only disrupts local traffic and logistics but also sends shockwaves through international trade routes, highlighting the critical need for robust supply chain resilience strategies.

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CLAREMONT, CALIFORNIA – March 28, 2024 –  In the aftermath of the catastrophic collapse of the Francis Scott Key Bridge, Lisa Anderson, MBA, CSCP, CLTD, President of LMA Consulting Group Inc., emphasizes the profound and wide-ranging impacts on global supply chains.  The bridge’s destruction not only disrupts local traffic and logistics but also sends shockwaves through international trade routes, highlighting the critical need for robust supply chain resilience strategies.

The incident, which tragically claimed lives and caused significant infrastructural damage, poses immediate challenges to the Baltimore port – the 5th largest container port on the U.S. East Coast. With the port effectively cut off, the repercussions extend far beyond the immediate delays and diversions. “This disaster underscores the interconnected nature of global supply chains and the cascading effects a single disruption can have,” Ms. Anderson notes. “It’s a stark reminder of why companies must prioritize flexibility, diversification and contingency planning.”

In response to the bridge collapse, Anderson advocates for the adoption of nearshoring, reshoring, friendly shoring and regional manufacturing strategies. These approaches not only mitigate risks but also enhance supply chain responsiveness and sustainability. “The current crisis highlights the vulnerabilities in our supply chains and the pressing need for strategic adjustments,” she states.

Drawing from her extensive experience in supply chain optimization, Anderson calls for a proactive stance with processes like Sales Inventory Operations Planning (SIOP) and the development of multiple backup plans. Her insights are informed by the broader context of recent disruptions, including drought conditions in the Panama Canal and geopolitical tensions affecting the Suez Canal. “In today’s volatile environment, a single backup is insufficient. Businesses must think several steps ahead to navigate and thrive amidst uncertainties,” Anderson asserts.

LMA Consulting remains at the forefront of guiding businesses through supply chain challenges, offering strategic insights and tools such as the Supply Chain Profitability Assessment. This tool encourages organizations to critically evaluate their supply chain operations, fostering agility and strategic foresight.

LMA Consulting specializes in guiding businesses through turbulent times with strategic formulation, comprehensive supply chain transformation and resilience-building solutions. For more insights, download Ms. Anderson’s eBook, SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue and EBITDA Growth.

About LMA Consulting Group – Lisa Anderson, MBA, CSCP, CLTD

Lisa Anderson is the founder and president of LMA Consulting Group, Inc., specializing in manufacturing strategy and end-to-end supply chain transformation.  A recognized supply chain thought leader, Ms. Anderson has been named a Top 40 B2B Tech Influencer by arketi group, a Top 16 ERP Expert to Follow by Washington-Frank, among the Top 10 Women in Supply Chain by Warner PR, in the top 55 Supply Chain & Logistics Experts by flexport, and a woman leader in Supply Chain by RateLinx.  Her primer, “I’ve Been Thinking.” offers strategies for creating bold customer promises and profits. An expert on the SIOP process, advancing innovation and enhancing supply chain resilience, Ms. Anderson is regularly interviewed and quoted by leading publications. For information, sign up for her Profit Through People® Newsletter or for a copy of her book, visit LMA-ConsultingGroup.com.                 

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Media Contact Kathleen McEntee | Kathleen McEntee & Associates, Ltd. | p. (760) 262 – 4080 | KMcEntee@KMcEnteeAssoc.com

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The Francis Scott Key Bridge Collapse & Impacts in the Supply Chain https://www.lma-consultinggroup.com/the-francis-scott-key-bridge-collapse-impacts-in-the-supply-chain/ https://www.lma-consultinggroup.com/the-francis-scott-key-bridge-collapse-impacts-in-the-supply-chain/#respond Wed, 27 Mar 2024 14:52:41 +0000 https://www.lma-consultinggroup.com/?p=23691 Horribly, a container ship collided with the Francis Scott Key Bridge, and much of the bridge collapsed. From a supply chain point of view, it has caused significant near-term impacts and extended disruptions in the region.

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Supply Chain Briefing

The Francis Scott Key Bridge Collapse

The Francis Scott Key Bridge Collapse

Horribly, a container ship collided with the Francis Scott Key Bridge, and much of the bridge collapsed. Cars went into the water, and it has become a deadly disaster. Our thoughts go out to the families impacted.

As we commented in Inc., from a supply chain point of view, it has caused significant near-term impacts and extended disruptions in the region. Transportation bottlenecks immediately emerged. Container ships, trucks, and rail were all impacted.

Port Impacts

It just so happens that the collapse of the bridge cut off the Baltimore port by in essence setting up a wall between the port and the Chesapeake Bay. The bridge’s collapse means that for the foreseeable future, it won’t be feasible to get to the container terminals. The port is likely to remain closed for several months and traffic diverted. This port is the 5th largest container port on the U.S. East Coast and the busiest port in the region for handling roll-on/ roll-off cargo such as cars, light trucks, construction and farm equipment, and more. The port also handled sugar, furniture, home appliances, coal, and other items.

Near-term, container ships will be diverted to nearby ports such as New Jersey, Pennsylvania, and Virginia ports. There will be delays, congestion, and diversions. Most likely, these delays will be relatively short-term as they are absorbed to nearby ports; however, it is another disruption in the global supply chain with short-term and long-term implications. As we communicated in a recent article on the impacts of the drought conditions in the Panama Canal and container ship attacks in the Suez Canal (both impacting shipments from Northeast Asia to the East Coast), this is an additional disruption at the East Coast ports. Thus, some shippers are likely to divert to the West Coast ports and rail or truck product to the East Coast.

Regional Logistics Impacts

There are 3,200 sites involved in logistics, distribution and warehousing nearby the port and bridge. Thus, there will be severe near-term disruption in the region. The timing will be heavily dependent on how quickly the debris can be cleared to restore safe passage in the area. Some experts believe this task could be accomplished in the next 1-2 weeks whereas others say it could take months. With that said, with the ports closed and diversions underway, it will take time for the supply chain to level out.

Trucking Impacts

According to the American Trucking Associations (AMA), almost 4,900 trucks travel the bridge each day, with $28 billion in goods crossing each year. There are alternate routes; however, there are issues associated with several of the options. For example, the two tunnel options to cross Baltimore harbor cannot carry hazardous materials, and there are height and width restrictions on the tunnels. Thus, trucks will be diverted on I-695 on the western side of the city. These diversions will cause additional delays, diversions, and cost.

Industry Impacts

The auto industry will experience the most significant impacts because the Baltimore port is the top American port for the import and export of cars. BMW, Volkswagen and Mercedes-Benz have facilities close to the port to handle vehicle shipments, and Mazda is had the highest dollar value of imports. The auto industry supply chain will be resilient but it will be another disruption after finally returning inventory to pre-pandemic levels.

The energy industry might experience disruption as well. There could be a disruption in coal supplies, gasoline and ethanol. The oil industry will have to find alternate routes for barge deliveries and/or pursue alternate modes of transportation (trucking). CSX transports imported coal and is communicating expected delays.

SIOP & Backups

It is quite clear that a single backup is no longer sufficient. You must proactively plan for likely risks and think 3 steps ahead of your competition to succeed in today’s global supply chain. SIOP (Sales Inventory Operations Planning) is a process to align demand with supply. It provides visibility across the supply chain so that companies can take proactive actions to mitigate risks, source backup sources of supply, and pivot with changing circumstances. For example, there is significant regional manufacturing, reshoring, and nearshoring occurring. To learn more about these strategies, download our complimentary book, SIOP: Creating Predictable Revenue and EBITDA Growth.

If you are interested in reading more on this topic:
How Do You Rate in Your Supply Chain?

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Inc.: Baltimore’s Business Community Grapples With Impact of Francis Scott Key Bridge Collapse https://www.lma-consultinggroup.com/inc-baltimores-business-community-grapples-with-impact-of-francis-scott-key-bridge-collapse/ https://www.lma-consultinggroup.com/inc-baltimores-business-community-grapples-with-impact-of-francis-scott-key-bridge-collapse/#respond Tue, 26 Mar 2024 07:48:01 +0000 https://www.lma-consultinggroup.com/?p=23684 The Baltimore disaster is expected to further compound the stress already placed on the global freight system. “Container shipping traffic has already been quite disrupted, because of the drought going on in the Panama Canal–ships from there [are] going through the Suez Canal to come to the east coast of the U.S. from Northeast Asia,” says Lisa Anderson.

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The Baltimore disaster is expected to further compound the stress already placed on the global freight system. “Container shipping traffic has already been quite disrupted, because of the drought going on in the Panama Canal–ships from there [are] going through the Suez Canal to come to the east coast of the U.S. from Northeast Asia,” says Lisa Anderson, a supply chain expert and president of California-based LMA Consulting Group.

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Baltimore’s Business Community Grapples With Impact of Francis Scott Key Bridge Collapse

For founders in the city, the loss of a Baltimore landmark is about more than missed income.

Early Tuesday morning, a cargo ship collided with Francis Scott Key Bridge in Baltimore, immediately collapsing the structure and sending cars plunging into the Patapsco River.

The incident sparked waves of alarm throughout the country. In speeches, Transportation Secretary Pete Buttigieg and President Joe Biden pledged federal assistance in rebuilding efforts. There is no indication that foul play was the cause of the accident, according to the Baltimore’s FBI field office.

Rescue crews continued to search the area for six construction workers who were on the bridge when the Dali, a 948-foot cargo ship bound for Colombo, Sri Lanka, collided with a bridge pylon around 1:30am, according to multiple reports. Two additional construction workers had been rescued from the water, and one was taken to the hospital. No fatalities had been confirmed by Tuesday afternoon, officials said. The Dali, a Singapore-registered vessel, dropped anchor prior to impact after the ship lost propulsion, CNN reported. The Maritime Port Authority of Singapore, which confirmed the loss of propulsion to CNN, says it is in contact with the US Coast Guard and cooperating with investigations.

The National Transportation Safety Administration announced an investigation into the incident on Tuesday afternoon, noting it would probe whether the ship did in fact drop anchor prior to impact.

In addition to the psychological toll inflicted by a disaster, the bridge’s collapse has massive economic ramifications: Submerged in the river, the remnants of the bridge now block access to the Port of Baltimore, the ninth largest port in the United States. The detritus will cause a massive re-routing of all traffic heading to the Port of Baltimore to nearby ports on the northeastern seaboard, Lisa Anderson, a supply chain expert and founder of the LMA consulting group, explains to Inc.

Read the full article at Inc.

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Supply Chain Shortages Remain a Concern: Strategies for Success https://www.lma-consultinggroup.com/supply-chain-shortages-remain-a-concern-strategies-for-success/ https://www.lma-consultinggroup.com/supply-chain-shortages-remain-a-concern-strategies-for-success/#respond Wed, 20 Mar 2024 15:16:42 +0000 https://www.lma-consultinggroup.com/?p=23662 Manufacturers wish they left supply chain shortages behind after the pandemic, but they remain top of mind. Concerns remain. According to KPMG, “71% of global companies highlight raw material costs as their number one supply chain threat for 2023.”

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Supply Chain Briefing

Supply Chain Shortages Remain a Concern: Strategies for Success

Manufacturers wish they left supply chain shortages behind after the pandemic, but they remain top of mind. Concerns remain. According to KPMG, “71% of global companies highlight raw material costs as their number one supply chain threat for 2023.” And the trend isn’t ceasing. According to a survey by LeanDNA and Wakefield Research, supply chain shortages remain a leading concern for manufacturers as they look to the future.”

In fact, if you look at the pharmaceutical industry, shortages have been creating havoc. For example, there have been shortages of over-the-counter drugs and prescription medications for ADHD, cancer and diabetes have been widespread. There has been commentary about a spike in demand, but there are also comments about manufacturing delays. Of course, this is before we discuss the state of logistics disruption.

In addition to product, material and healthcare shortages, clients are experiencing a severe shortage of high-skilled talent and are struggling to upgrade ERP systems and related technologies. These issues are aggravating the shortage situation as multiple clients have the lack of system support creating further shortages and work stoppage in addition to frustrating their employees.

It is simply creating havoc as people jump into jobs they are not prepared to execute, and Executives are struggling to understand why their resources no longer seem to have the expertise they used to have. Worse yet, if they don’t realize this is occurring, the situation gets worse as employees make poor decisions and struggle to keep up. Refer to our article, Where the Talent Has Gone & Strategies for Success.

Strategies for Success

Customers will not suffer endlessly as shortages persist. They will find alternative sources of supply, source from different regions of the world, find backup sources, search for suppliers that can provide visibility and status of the end-to-end supply chain and invest in reshoring, nearshoring, and expanding regional manufacturing footprints.

Thus, proactive executives are getting ahead of these challenges. We have no doubt that the companies that can supply critical items in the next several years with uninterrupted supply will lead their industries for decades to come. What are some of the best practice strategies being deployed?

  1. Go back to the basics: It is simply surprising how many clients are running into problems with the fundamentals. Who knew a best practice was to return to basics! According to a leading authority on the subject of generational diversity in the workplace, the younger generations is struggling with ambiguity and decision making. This has proven to be “on the mark” as clients have employees stuck and struggling as they don’t know why the computer is spitting out answers that are wrong and what to do about it. Thus, we are jumping in to define processes, educate on concepts and help clients over this unexpected bottleneck. Perform a supply chain assessment to quickly size up where to focus. Take our complimentary supply chain assessment quiz.
  2. Planning best practices: There is no doubt that production planning, materials management, replenishment planning, and each planning expertise is in limited supply yet is cornerstone to mitigating shortages and getting in front of demand. Refer to recent examples of how this topic can make or break success in our recent article.
  3. SIOP (Sales Inventory Operations Planning): One of the single best strategies to get in front of changing conditions and ensure profitable growth is to rollout a SIOP process. A SIOP process will align Sales with Operations, demand with supply, and, most importantly, it will provide a proactive view into changing circumstances with recommended solution options, impacts on product and customer profitability, heads up to capacity bottlenecks, and sales funnel changes. Read our book, SIOP: Creating Predictable Revenue and EBITDA Growth.
  4. ERP, advanced technologies & automation: No client will succeed with manual spreadsheets long-term. The most successful clients are better utilizing their ERP systems to provide enhanced visibility, flexibility, and service while also pursuing advanced technologies (digital twins, artificial intelligence, IoT, robotics, meta) and automation to improve efficiencies, reduce errors, and increase scalability and profitability.
  5. Innovation: Continuous improvement is no longer enough. Only those companies that innovate and turn 1+1 into 22 with collaborative partnerships will succeed.
  6. Trends & Metrics: Although it is essential to review progress and results by tracking key performance indicators like OTIF (on-time-in-full), production output, and inventory turns, it is even more important to be focused on “where the puck is going” (not where it has been). Tracking trends, listening to diverse perspectives, researching and trialing new and potential trends is the focus of our most successful clients.
  7. Regional manufacturing: Although this topic should arise through your SIOP process, our money is on regional manufacturing. Clients must take control over their ability to service customers. Reshoring, nearshoring, expanding manufacturing and collaborative partnerships are hot topics. For example, even industries such as medical device, pharmaceutical, and computer chips are joining aerospace, food & beverage, industrial equipment, and building products to produce close to customers.
  8. Talent: We’d be remiss not to mention that talent will “win” in the end. Attract, hoard, develop, train, and mentor talent!

Shortages are persisting. Geopolitical tensions remain high. Critical supplies such as computer chips, medical supplies, and aerospace and defense products are providing evidence that it isn’t just a lack of “nice-to-have” items. Pursue strategies to ensure you are ahead of the curve, and your business will thrive.

If you are interested in reading more on this topic:
Why Manufacturing Matters and Will Thrive in the Next Decade

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Building Agility and Resilience for Business in 2024 https://www.lma-consultinggroup.com/building-agility-and-resilience-for-business-in-2024/ https://www.lma-consultinggroup.com/building-agility-and-resilience-for-business-in-2024/#respond Mon, 18 Mar 2024 17:04:23 +0000 https://www.lma-consultinggroup.com/?p=23658 In this episode of Interlinks, we delve into the heart of navigating through the unpredictable tides of global events and their profound impact on supply chains, discussing the imperative need for agility and resilience.

The post Building Agility and Resilience for Business in 2024 appeared first on LMA-Consulting Group, a supply chain consulting firm.

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In this episode of Interlinks, we delve into the heart of navigating through the unpredictable tides of global events and their profound impact on supply chains, discussing the imperative need for agility and resilience.

Joined by distinguished supply chain experts Lisa Anderson, David Ogilvie, and Art Koch, I explore the innovative strategies companies are adopting to fortify themselves against the unpredictability of the future, focusing on building these critical qualities into the very fabric of their operations.

Amidst a backdrop of global pandemics, geopolitical tensions, and extreme weather, our conversation illuminates the path for businesses aiming to thrive in a world where the concept of ‘normal’ is constantly redefined.

Play audio.

Originally published on Patrick Daly Interlinks Podcast on 3/12/2024

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BBC: Why firms are bringing their manufacturing back home https://www.lma-consultinggroup.com/bbc-why-firms-are-bringing-their-manufacturing-back-home/ https://www.lma-consultinggroup.com/bbc-why-firms-are-bringing-their-manufacturing-back-home/#respond Thu, 14 Mar 2024 23:46:14 +0000 https://www.lma-consultinggroup.com/?p=23633 Lisa Anderson, a supply chain expert and president of California-based LMA Consulting Group, says that the Chips Act "has spurred on certainly quite a bit of investment" in the US electric car sector. And Mexico is also booming through 'friend shoring'. ### Why firms are bringing their manufacturing back home Reshoring is when a company decides [...]

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Lisa Anderson, a supply chain expert and president of California-based LMA Consulting Group, says that the Chips Act “has spurred on certainly quite a bit of investment” in the US electric car sector. And Mexico is also booming through ‘friend shoring’.

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Why firms are bringing their manufacturing back home

Reshoring is when a company decides to stop getting its manufacturing done overseas, such as in China, and instead returns the work to its home country.

We have all heard of offshoring, which started as a major economic movement in the 1990s, when companies started to relocate their manufacturing abroad. They more often went to China, where incentives from the Chinese government were generous, and the workers were cheap.

The result was a Chinese manufacturing boom, and a long supply chain from Europe and the US to China and beyond.

But now the West is fighting back, with an increasing trend towards reshoring. More than half of UK manufacturers are now reshoring, according to one study at the start of this year.

Other firms are “near shoring”, which means that while they are still getting their manufacturing done overseas, they are moving it to a nearer country.

And then there is so-called “friend shoring”, whereby you keep your manufacturing abroad, but move it to a country that has friendlier relationships with your own. Apple is said to be doing this, as it increasingly moves production from China to India.

… western governments have become increasingly aware that they are becoming dependent on potential enemy nations for their cutting-edge technology and supplies.

In America Presidents Biden and Trump have tried to address this issue, President Trump with tariffs, and President Biden with financial incentives. Mr Biden has been throwing hundreds of billions of dollars at making American industry make things in the US, especially microchips via the 2022 Chips Act. This pledged $52bn (£41bn) to boost domestic production of computer chips.

The Biden administration is also giving $15.5bn to the US electric car sector.

Lisa Anderson, head of US management consultancy LMA Consulting Group, is a supply chain expert. She says that the Chips Act “has spurred on certainly quite a bit of investment” in that sector.

And it is not just American workers who are benefitting from US firms bringing manufacturing closer to home. Mexico is also booming, says Ms Anderson, who points out that America’s southern neighbour now exports more goods to the US than China.

 

Read the full article at the BBC website

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