End of Month Management Update

As September comes to end, here’s a roundup of some of the month’s more significant supply chain management developments.

Regional designs.

To better deal with growing protectionism and the need for higher agility, chief supply chain officers (CSCOs) must incorporate regional designs into their global networks without diluting the cost or competitive advantages of existing global networks, according to Gartner, Inc. Gartner analysts noted last month during the Gartner Supply Chain Symposium/Xpo that global trade has tripled in the 21st century, from $7 trillion to $21 trillion – along with the complexity of global supply chain networks. “Many industries have become capacity-constrained,” said Kamala Raman, vice president analyst with the Gartner Supply Chain practice. “Some of this is driven by availability of material, some is driven by labor shortages in both manufacturing and transportation, some of it is driven by changing quarantine conditions around the globe, as well as the general inability of countries around the world to operate at a pre-pandemic normal.”

Risky business.

Kroll, a provider of services and digital products related to valuation governance, risk and transparency, revealed the results of a global survey suggesting that the world’s biggest companies were most affected by corruption and illicit activity in 2020. Kroll’s Global Fraud and Risk Report shows that 57% of respondents at companies with a turnover of more than $15 billion reported a very significant impact from illicit activity, such as fraud, corruption and money laundering on their organizations, with a further quarter (25%) describing the impact as somewhat significant. The survey highlighted that U.S. companies are placing an increased focus on proactive measures to manage bribery and corruption risk, including enterprise-wide risk assessments (89%) and the use of proactive data analytics (91%). In Canada, proactive measures were somewhat less widespread, with 72% using data analytics and 60% conducting enterprise-wide risk assessments.

More confidence.

GlobalTranz Enterprises, LLC., a leading technology-enabled third-party logistics solutions provider, recently released the results of its third survey of U.S. supply chain managers in the past year. On the heels of last year’s boom in online shopping, this latest survey reveals that companies have confidence in their e-commerce strategies ahead of the official 2021 peak shipping season that traditionally runs from September through December. At the same time, the survey of supply chain managers highlights anticipated challenges for the second half of the year, from new COVID-19 variants threatening another phase of lockdowns to ongoing challenges in recruiting and retaining employees. “While the resurgence COVID-19 has created another element of uncertainty heading into peak season, we’re seeing cautious optimism around how supply chains have adapted to the challenges of the past year,” say researchers. “Businesses have put in place new supply chain strategies and established partnerships with logistics providers that can help them manage through this volatile environment.”

Follow the money.

Automation is key to accelerating trade finance organizations’ digital journeys, according to a new whitepaper released by banking software specialist, Conpend. The paper explores the transformative potential automation has for the global trade finance supply chain, and showcases ING Bank as a notable example of what can be achieved with automation powered by artificial intelligence and machine learning. Researchers contend that almost 80% of world trade relies on trade finance, which in turn, depends on accurate documentation to run smoothly. Yet, despite rapid technological advancement and an increased appetite from organizations to shift to digital in recent years, large volumes of paper-based documents persist in the supply chain. In fact, 45% of bank respondents to a recent survey reported that physical paper for documentary transactions had been removed “to no extent.” Researchers conclude that ING Bank, by contrast, reduced errors and improved its interaction with clients.

Gridlock boxes.

Record volumes of incoming cargo continue to trend upward at the San Pedro Bay ports of Los Angeles and Long Beach and so has the average container dwell time, the amount of time a container stays at a marine terminal after it is unloaded from an ocean carrier. The heightened dwell time is a result of pandemic-related congestion throughout the supply chain, including the lack of warehouse space, missed appointments by trucking companies, rail capacity, and equipment shortages. For the month of August, the average container dwell time for containers slated to leave on trucks was 5.4 days, up from 5.2 days in July. The proportion of truck-bound containers that remained on terminals for more than 5 days rose from 26.7% in July to 28.4% in August. Dwell time in August for containers leaving vial rail was down compared to the month before.

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