The SupplyChainBrain Podcast

Corporations pay lip service to enforcing human rights and fair working conditions in offshore factories. But the deaths and injuries continue. An estimated 2.3 million deaths each year, in fact, from work-related accidents or diseases. Many are the result of unsafe factory environments, despite efforts by original equipment manufacturers to ensure that their suppliers are meeting high standards for ethical behavior. Recently the European Union announced financial support for the Group of Seven's Vision Zero Fund, a multi-donor initiative that provides cash for fire inspection and enforcement of safety regulations in factories worldwide. But our guest on this episode, Pierre-François Thaler, co-founder and chief executive officer of EcoVadis, believes that effort is inadequate. It's not enough money, he says, and it's the wrong approach. Here, he explains his reasoning, and offers advice as to what companies really need to do, in order to ensure that factory workers are being treated in a fair and safe manner – despite the lack of visibility that many companies have to all partners within their multi-tier supply chains.

Can playing a game help supply-chain managers cope with the uncertainties of the real world? Experts would say yes. As far back as the early 1960s, professors at MIT's Sloan School of Management developed the Beer Game, which despite its frat-friendly name was a sober attempt to demonstrate the principles of supply-chain management. Since then, academics and practitioners have developed a number of so-called ''serious'' games and simulations to address the complexities involved in achieving the proper balance between supply and demand. The latest version is SCI Impact, developed by Sterling Simulation in partnership with Supply Chain Insights. It extends the concept of the Beer Game to encapsulate the realities of entire supply chains. Pairs of teams compete to see who can dictate the most effective inventory and ordering policies in response to shifts in demand. On this episode, we get an introduction to SCI Impact from Paul Rohrbaugh, president of Sterling Simulation. He talks about the history of gamification in supply-chain management, what his new game hopes to accomplish, and how it might evolve in future.

Commercial delivery drones are in our future – or so we're told. What will it take to make them a reality? Drone technology is advancing quickly. Amazon.com is well along in its development and testing of drones for delivery of packages. And now Wal-Mart says it wants to start testing drones as well. Soon, it seems, the skies will be filled with these futuristic flying machines. First, though, there are some practicalities that need to be addressed. Chief among them is a proposed ruling by the Federal Aviation Administration that places onerous restrictions on commercial drone operators. And there are economic factors to be considered. Can online merchandisers really operate drones in a profitable fashion? On this episode, we get answers from Lisa Ellman, partner in the law firm of Hogan Lovells. A former advisor to President Obama on drone policy, she fills us in on the progress of retailers' efforts to make drones an everyday part of our online shopping experience.

There's more to reshoring than simply moving a factory from Asia back to the U.S. Higher wages for Chinese factory workers, coupled with the headaches of maintaining long supply lines, are prompting manufacturers to relocate plants closer to markets in the western hemisphere. In some cases, that means a return to the U.S. But there's an important link in the supply chain that needs to come back as well: the ability to recycle, repair, refurbish or dispose of excess, obsolete and defective parts. The two main pieces of the reverse supply chain – post-industrial recovery and post-consumer recycling – must be situated close to the point of manufacture. Producers need to set up a locally based ''ecosystem'' of partners and resources to make it all work. On this episode, Linda Li, chief strategy officer with the Li Tong Group, returns to the podcast to talk about the challenges that technology and telecommunications companies face when they attempt to set up remanufacturing and recovery operations in the U.S. – not the least of which are far more stringent environmental regulations than in Asia. How can that hurdle be overcome?

Are you certain that your sensitive exports aren't falling into the wrong hands? In today's world of global, multi-tiered supply chains, it can be a challenge determining who the end buyer really is. In the case of certain high-tech products, or items for military use, regulators demand that companies maintain the highest possible degree of vigilance. But complying with the rules is getting tougher all the time. These days, there are hundreds of lists containing the identities of denied parties. What's more, companies can be punished for selling to suspicious buyers that aren't on any list. They can even be in violation of the law for disclosing the wrong information in a speech. On this episode, Ken Harris, head of denied-party screening with Descartes Systems Group, talks about what companies must do to ensure that their products or sensitive information aren't going astray. The potential fines and penalties, both civil and criminal, make it essential that exporters demonstrate an extraordinary level of care.

It's a dangerous world out there for global supply chains. Earthquakes, tsunamis, floods, labor stoppages, terrorist threats and general congestion all conspire to hinder the flow of product to market. The situation calls for a renewed commitment to risk management and, most of all, supply chain resilience. Joining us on this episode is MIT professor Yossi Sheffi, director of the school's Center for Transportation and Logistics, and author of the new book The Power of Resilience: How the Best Companies Manage the Unexpected. Sheffi reveals how leading companies are protecting themselves against supply-chain disruptions. He lays out some of the key elements of a successful resilience initiative – just in case your company is one of the many that have yet to make a serious effort in that area. Learn why it's just possible that Intel's Andy Grove was right when he said that ''only the paranoid survive.'' Welcome to the 100th episode of The SupplyChainBrain Podcast!

The Reshoring Initiative would like to slap the ''Made in U.S.A.'' label on a lot more products. Can it succeed? The organization's mission is to convince companies to bring manufacturing jobs back from China to the U.S. Recent economic trends in China, including a growing labor shortage and rising factory wages, are helping to make that dream a reality. At the same time, China's recent devaluation of the yuan appears to be drive by a desire to make its manufacturing exports more competitive. So are the jobs really coming home? On this episode, we speak with Reshoring Initiative founder and president Harry Moser. He discusses the group's efforts and talks about some recent successes. And he addresses the real challenges that stand in the way of a wholesale shift of manufacturing to the U.S. The big question: does the U.S. have the people and the skills to handle a big influx of work from China? For that matter, what will those returning jobs look like? Will automation undermine the benefits of reshoring for American workers?

A message to procurement managers: Your job is about to be transformed ''almost beyond recognition.'' Those are the words of Kai Nowosel, managing director of the Sourcing Procurement Practice of Accenture Strategy. On this episode, he talks about the big changes that are coming to procurement, spurred by developments such as digital platforms, sophisticated analytics and the Industrial Internet of Things. All of this promises to boost procurement's position in the organization, beyond its traditional role as a cost-cutter. Expect procurement managers to gain new respect in the executive suite, Nowosel says. Hear what a select group of high-level executives, academics and technology providers thinks the future holds for procurement. And discover how a combination of technology and business-process change will create ''the marketplace on steroids'' – all in just five to seven years.

U.S. West Coast ports are being ''held hostage'' by longshore labor. So says one noted economist. Diana Furchtgott-Roth is a former chief economist with the U.S. Department of Labor. Today, she serves as director of Economics21, in addition to acting as senior fellow at the Manhattan Institute for Policy Research. She believes it's time for a change in the way that longshore labor is regulated. The National Labor Relations Act, which currently governs activities by U.S. dockworkers, doesn't prevent them from bringing port operations to a halt at will. But their actions – as in the case of the recent slowdown at West Coast ports – can have serious consequences for the U.S. economy. Furchtgott-Roth says ports should fall under the same law that governs rail and airline labor, and prohibits strikes under the theory that those sectors are vital to interstate commerce and the nation's economy well-being. Disputes under the jurisdiction of the Railway Labor Act are settled through mediation and, if necessary, a board of arbitrators selected by the President of the U.S. Ports, she says, are no less crucial to commerce than railroads and airlines, especially at a time when international trade is so vital to the nation's interest. But is a change in the law politically feasible?

This is a ''watershed year'' for cybercrime, according to a new survey on the topic. Yet many companies are falling short in their efforts to battle it. The state of corporate cybercrime protection is mixed at best. Government agencies and boards of directors are taking an increased role in the adoption of good preventive practices, according to a new survey by PwC, CSO, the U.S. Secret Service, and the CERT Division of the Software Engineering Institute at Carnegie Mellon University. On the other hand, many companies still aren't fully aware of the threat presented by hackers, terrorists and foreign governments. Shockingly, one in five of the surveyed executives said they aren't worried about the risk that cybercrime poses to their supply chains. Even some of the more forward-thinking organizations haven't progressed very far on the maturity curve. On this episode, we discuss the implications of the survey with PwC partner Quentin Orr. He outlines the various kinds of cyber threats, addresses the critical issue of third-party risks, and reports on the level and types of corporate investment in people, process and systems. Finally, he answers the key question: Given the sophistication and persistence of cyber-criminals today, is there any hope?