Supply Chains in a PostCOVID World

thank you for inviting me

to speak today about supply chains i

hope this is the beginning of a

conversation we can continue to have

about how to build supply chains

differently in a post-covered world

when i refer to supply chains i’m

talking about people

the farmers the producers the processors

the designers the manufacturers and

distributors

who get products to our homes and to our

shops

as we entered lockdown in march of this

year

i like many parents was faced with

trying to explain to my

five and two-year-old the implications

of the coronavirus on our way of life

i found my way to a book called the

world comes to my place today

it’s about a boy called george whose

sister has

chickenpox and george can’t leave the

house because

he might be infectious too you see the

similarities

in this joyous tale granddad helps

george

cope with boredom and his increasing

sense of

isolation by noticing his

interdependence

room by room item by item toothbrush

bread

chocolate coffee they explore where in

the world it has come from

and the book reminded me of the new

economics foundation’s

interdependence reports in the mid to

late 2000s

through mapping where the things we buy

in the uk come from

it showed we are hyper connected to the

world

and in fact reliant on it to sustain our

way of life

we sort of know this we occasionally

check labels to see where things are

made

but the details of supply chain who does

what when

are largely mysterious to us and perhaps

intentionally so but in 2020 covid

happened

and our interdependence and the inequity

in it was

totally laid bare changing consumption

patterns in countries like the uk

caused supply chains to collapse when

people stopped consuming

lead firms and supply chains cancelled

their orders

news outlets started reporting things

like 50 uh 40 million garment

workers 40 million in the fashion

industry were plunged into immediate

destitution when contracts were

cancelled

and jobs were lost put simply cancelled

contracts

means no work which means no income

which means no food to eat

research has found that there’s been a

70 drop in income

among the urban poor and people living

in urban slums

ids is action research programme on the

worst forms of child labour

i think it’s called clarissa found the

leather sector in dakar

in bangladesh closed most of its leather

processing factories

and this left around 25 000 tannery

workers

at the bottom of the supply chain in

great despair

about their lives the emerging evidence

is directly implicating decisions that

are made in supply chains

to sustainable development goal 1 for no

poverty

sdg2 for zero anger sdg

10 for in reduced inequalities and sdg 3

for health and well-being and at this

point i’m wondering

how the world came to my place today

might be written for a child at the

other end of the supply chain to george

say the child of a bangladeshi textile

worker who just lost their job

and who hasn’t had enough food to eat

today

i wonder if the tale would be more

cautionary

in tone than a joyous celebration of

human connectivity

so i think covid as i think of covid as

a reckoning

for global supply chains a stress test

and they

failed millions of people but they

didn’t have to

so consumer goods company unilever

placed 500 million euros

on the balance sheet to make early

repayments to suppliers

particularly small suppliers so that

they could stay in business

another uk company the coffee and tea

company betties and taylors

committed to honoring all their

long-time long-term contracts

accelerating the flow of money to

suppliers where needed

and they opened up credit lines to

growers

and social lenders the action unilever

and betters and tailors took

to anchor their supply chains for

greater resiliency

and sustainability reminded me of the

role of anchor institutions

in local economies traditionally

anchor institutions have been

not-for-profit organizations

they’re place-based institutions like

universities

healthcare trusts housing associations

with large purchasing power they are

able to pull their

commissioning and their procurement

budgets to irrigate investment

in to local communities and keep it

circulating

and so it doesn’t trickle out

now how do we get more

companies like bettis and taylors and

unilever use

acting like anchor institutions in their

supply chains

well i thought we could mandate that

they do but free market

economics might have something to say

about that

now the reason corporates haven’t

historically acted as anchor

institutions

is that they don’t have what we call

sticky capital

a connection to a place which means they

cannot easily

move operations to another location

which seems more financially viable

so airports and football clubs are

famous exceptions so what can we learn

from betis and taylor’s and unilever

which other organizations

can adopt well when you read about why

betis and taylor’s

used their leadership role within their

supply chain

to provide security to stakeholders they

refer

back to their family business

constitution

and this constitution recognizes their

business does not stand

alone and when you hear alan joe

the current ceo of unilever speaking

he explains the company’s focus on an

integrated approach to sustainability

echoes the girl the goals of its

founders who in 1870

wanted to be a force for good and to

lessen the load of women who bore the

brunt of household chores

in 1870 but when workers went off to

fight in the first world war they kept

people’s jobs open and they continued

paying wages to their families while

they were away from home

so when you look at these two at first

glance we notice they are both

purpose-driven organizations they sort

of have purpose in their soul

which is both heartening and

disappointing at the same time

because it takes a long time to shift

mindsets in less purpose-driven

purpose-driven businesses and we know

that two examples does not a pattern

make

they are outliers but when you look

and listen again you can see what they

know to be true

that their own companies are part of an

interconnected whole

the company revenue benefits from that

interconnectivity

and the decisions key companies make in

supply chains

impact millions of people’s lives deeply

and it’s this acknowledgement and this

disclosure of

impact to their shareholders to their

customers

to each other across the table in the

boardroom

which is what created the need for

active leadership in their supply chains

so once we realize this the question or

the challenge then becomes

how do we get more investors more

customers

more senior executives aware of the

human impact

of their decisions in supply chains and

my suggestion is that we make the

invisible

visible in my current role friday pulse

i’ve been working with a very innovative

statistician nick marks to radically

change the ways

organizations monitor well-being week to

week

quarter to quarter here is an example

of a heat map that one of our clients

might see

across the top at the left hand side

they can see how

happy people are which is our ultimate

measure of

impact and all the other columns to the

right

measure key drivers of a positive

employee experience

so the balance of time people spend at

work versus other aspects of their lives

the extent to which they feel they can

influence decisions in their work

and the quality of their relationships

at work

down the side we have every team every

division every team

every sub team listed and we ask people

about their subjective experiences about

how they feel

and we convert answers on a 100 scale

and this scale is color coded from red

to green

so at a glance a senior leader or a hr

business partner

can see where things are going well and

where things aren’t

they can see the diversity of experience

that exists within their workforce

and they can see where to focus their

energies and efforts to improve things

by bringing people’s experiences to the

foreground

we are shifting the nature of

conversations in businesses

we are changing the focus and we’re

changing the concerns

of companies all over the world we are

making workplaces

even globally distributed workforces of

10 000 people

more human and it’s not hard to imagine

that we can use digital

platforms to account for diversity of

experiences in supply chains

we can organize impact data according to

key actors

in the supply chain like women even

children

we can use sampling methods to capture

the experiences about

actors in the informal sector the

informal economy that sits around supply

chains so they

their experiences can also be included

fundamentally i believe getting supply

chains to acknowledge and disclose their

human impact is a sweet intervention

point

because it creates amplifying feedbacks

across our financial and our legal

sectors

where impact reporting is strengthening

around climate change for example

we see the creation of league tables and

scorecards

that highlight the best and the worst

performing companies

these legal tables work as a behavioral

intervention

because no one wants to be at the bottom

just as no

ceo wants to see red scores on the

friday platform

in the businesses they lead where we

have

impact reporting we organize pension

packages

which invest in those companies that are

promoting and

positively contribute towards the

sustainable development goals

where we have impact reporting we

amplify how the rule of law can be used

to protect worker rights and human

rights

all these ripple effects celebrate and

reinforce the actions of companies

like unilever and betis and taylor to

anchor their supply chains

and they provide the impetus for other

companies to follow suit

just to conclude i have been working in

and around supply chains now for

10 years and this feels like the first

time

that the existence of supply chains as

discrete socioeconomic entities has

truly lodged itself

in our collective consciousness which is

why the time is now

supply chains have become super

structures that affect all our lives

and the future that we want in the

intervening years while waiting for this

to happen

i’ve learned a lot from the way

indigenous people organize their food

systems

they have invested in their relational

systems to form a social safety net

for agriculturalists in northeast india

this looks like exchanges of time

exchanges of seeds and the proceeds of

harvest so that if one family’s crop

fails they’re not left destitute

for a nomadic pastoralist in kenya their

animals

are their family they treat them like

that they are extensions of them

and their way of life true

sustainability and resilience they have

taught me

is not about organizing the world so we

can go on living as we currently do

in countries like the uk it’s about

equal and reciprocal relationships

between people between people and

institutions

and between people and the natural

environment

it’s about providing economic and social

security like betis and taylor’s

and unilever have done it’s about me

looking after you

and you looking after me it’s about what

we invest in each other

as well as what we enjoy from each other

at the end of the world came to my place

today

george goes to bed clutching his globe

and happy

and reassured by his new sense of

connectedness

i’d like to go to bed tonight thinking

that george will wake up tomorrow

or maybe the next day but hopefully one

day before his

sister’s virus clears up

and he says grandad that’s all well and

good but how should i go

to the world today