Adapt to Survive Supply

Chain Disruptions – Part 1

Mark Morley, Industry Marketing Director

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Today’s Agenda

• How Are Today’s Global Supply Chains

Being Impacted?

• Managing Business & Operational Risk

• Minimising Supply Chain Risk Through

Operational Changes

• How Can B2B Help Minimise Supply

Chain Risk?

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Today’s supply chains need to be highly resilient,

scalable and flexible to meet the challenges of doing

business during a period of significant disruption

Supply Chain Disruption is Becoming a Recurring Theme….

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Icelandic Volcano - 2010

Much of Europe’s airspace was shutdown due to the spread of volcanic ash in the atmosphere. As a result, global air freight shipments were severely affected.

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Japanese Earthquake - 2011

Japan’s East coast was severely impacted by the earthquake, many factories and utility infrastructures were destroyed and logistics networks ground to a halt.

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Japanese Tsunami - 2011

The Japanese Tsunami caused more longer lasting damage to Japan’s infrastructure and as a result supply chains have been impacted for more than 12 months.

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Thailand Floods - 2011

Many high tech companies were impacted by the Thai floods, at one point it was estimated that up to 90% of the world’s supply of hard disks had been affected.

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Thailand Floods - 2011

Honda’s factory was severely affected by the floods and as a result millions of dollars worth of cars had to be written off. Honda is now re-building the plant.

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Somali Pirates - 2011

Somali pirates have hijacked oil tankers and container ships. Goods exported from the West coast of India have had to be re-routed around the problem areas.

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Sinking of the Rena Container Ship -2012

Ocean freight is susceptible to disruption when a major container ship runs in to trouble. Most of the containerised cargo has to be written off.

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Sinking of MSC Napoli - 2007

BMW Customer Services – “Sorry Sir, we cannot seem to trace your new motorbike which was enroute from our factory in Germany!”

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Chinese Restriction on Export of Rare Earth Materials - 2011

China controls up to 90% of the world’s rare earth materials. Government export restrictions impacted the shipment of components across high tech supply chains.

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UK Strike by Fuel Tanker Drivers -2012

UK businesses disrupted by ‘potential’ wildcat strikes by 2000 fuel tanker drivers. The retail and grocery industry is always first to feel the pain.

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Factory Explosion Causes Global Shortage of Nylon12 - 2012

Explosion at Evonik Industries factory in Germany causes global shortage of CDT, a key ingredient of PA12 which is widely used across the automotive industry.

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Managing Business and

Operational Risk

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Business & Operational Risk and their Domino Effect

Source: Global Risk Report 2012 – World Economic Forum

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Example of Organisation Resilience Based on 18 Metrics

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Types of Supply Chain Risk

Source: APICS 2011 Supply Chain Risk Report

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How Well Do You Know Your Supply Chain?

Source: APICS 2011 Supply Chain Risk Report

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Thank You

Phones

US: 1-800-334-2255, option 3

EMEA: +44 (0) 1932 776047

GXS web sites

US: www.gxs.com

EMEA: www.gxs.eu