How does your country fare in the 2020 FM Global Resilience Index

Australia is 17th overall in the 2020 FM Global Resilience Index, yet we are 22nd in Supply Chain resilience.
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Some of the indicators show more work is needed around Productivity. Here we are in a BAD state – we have given away our ability to manufacture. Instead, we dig stuff up/grow it, sell it to make a small profit, then we BUY it back at a huge price after it has had ‘value’ added. Economics-101 tells you that is a dumb idea.
Then there is our Corporate Governance (hmm, maybe this one applies to corporate AND Government) & Infrastructure – things we have just ignored or because there are some who didn’t want us to see, either way. we are now realising these also bite if not monitored and kept up to standard.
There are less insidious ones, for example Exposure to Natural Hazards. We are aware of these, we just need to do more about working to reduce the risk. And this is the sad thing, we just got so apathetic on preventing unnecessary outcomes from fires, floods and storms. 
There are two we need to keep an eye on as they are based on outside forces: specifically our reliance on imported oil – we only have a stockpile of around 26-30 days. Options being proposed will not address the need if we start running out (if there was a double hit covid-19 AND an oil shortage – Australia will not slow down, it STOPS.
The other issue to watch is our cyber-security, as an island nation, a long way from the rest of the world, a catastrophic cyber hijacking or cyber war, or whatever, would be devastating
Ok, I agree, we are doing well compared to the whole data population but compared to Western countries we are in a dismal state – how could AU be so far behind NZ and UK in Supply Chain?  Location has nothing to do with it as NZ and UK are on opposite sides of the planet! (Its rhetorical – I am sure there are plenty who would love to comment).

When compared to a couple others:

  • Norway = 1st Overall / 12th Supply Chain
  • Singapore = 22nd Overall / 1st Supply Chain
  • United Kingdom = 13th Overall / 4th Supply Chain
  • New Zealand = 15th Overall / 6th Supply Chain
  • Australia = 17th Overall / 22 Supply Chain
  • Indonesia = 80th Overall / 63rd Supply Chain

 

If you want to find out about your country or more data on Australia visit the source: https://lnkd.in/gZ_NjZU

 

 

A new supply chain paradigm

Every generation has had its own global catastrophe, whether caused by ourselves or nature. And as every catastrophe challenges societies and cultures at the time, they also challenge the status quo. Yes, things do and will change.

COVID-19 has laid bare weak links in supply chain around the world. And now all involved in the supply chain are beginning (if they haven’t already) to review, reassess and consider other options.

But, did we really get it all that wrong based on the data and information we had at the time (prior to covid-19)? Definitely, many a BCP written within the last 10 years highlighted a number of weaknesses including those we see now, what we did not count on was the fallout of these – the subsequent events that have made the risks to the supply chain multiply as time goes on. China states it is getting its processes back on line, but the bull-whip effect from the panic buying, hoarding and (likely) government actions to limit continued or even secondary covid-19 events, will take its toll for a while to come.

Markets will change as the psyche of the customer changes, and the supply chain will morph into something completely different to today’s. We will probably see a rapid return to “make/buy local’ and although it will not be a complete shift, it will definitely be the critical components (for manufacturers). This change will become a feedback loop, those in the BRICS group will change their inter-relationships as China’s market/manufacturing changes.

As with any major disruptor – not a new invention or new software – but real disruptor a global one, there will be a repositioning of power, as governments rewrite legislation to control the flow of goods (they are already looking at this), countries lose their attraction as costs to obtain goods increase, manufacturing moves back on-shore as companies lessen their reliance on cheap but long supply chains.

Other considerations for the supply chain will be the environmental risks that are now regularly appearing, such as rampant fires, devastating floods and earthquakes – irrespective of where/why/who, the environment will be a consideration. As will the geopolitical world we have woven for ourselves. Future forecasting and supply chain planning will not be limited to cost mitigation, improved utilisation of resources, reduction in inventories and velocity to market. There will be a multitude of risks that will need to be:

  1. Identified
  2. Classified
  3. Quantified and then
  4. Mitigated as best as possible

As I see it, there will be an increase in local suppliers (although not for everything), there will be an increase in the need for information all along the supply chain prompting an increase in IOT and probably, block-chain, along with advanced forecasting software, including AI and predictive modelling. There will also be a need for more collaboration between partners to enhance efficiency plus much more.

Globalisation, will still be around but not in the way we have become accustomed to. And, although we will return to BAU, it will be a new and for a while a very challenging BAU. This is about Change with a capital “C”, it will be an exciting time, for tomorrow will be driven by those who can think laterally, out-side-the-box, have a variety of experiences, a range of skills and not be attached to the “old ways” – at least for the near future.