Managing Supply Chain Disruptions

The U.S. Military has a "China Problem" that most people are completely ignoring. 🇺🇸🇨🇳 While headlines focus on troop counts and carrier groups, the real battle is being fought in the periodic table. Over 70% of U.S. rare earth imports come directly from China. But it’s not just about "imports"—China controls nearly 90% of the world's refining capacity. Even minerals mined in the U.S. are often sent to China just to be processed. 🛡️ Why the Pentagon is Worried Modern warfare isn't just steel and gunpowder; it’s magnets and semiconductors. Without rare earths, our most advanced systems are just expensive paperweights. Here is the "material cost" of a modern military: F-35 Fighter Jet: Uses 418 kg of rare earths. (Crucial for targeting lasers, stealth flight controls, and high-temp engine magnets) Arleigh Burke Destroyer: Uses 2,600 kg. (Powering the SPY-1 radar and missile guidance systems) Virginia-class Submarine: Uses 4,600 kg. (Essential for the quiet propulsion motors and sonar arrays) ⚠️ The Chokehold It's not just "rare earths." China currently produces: 98% of the world's Gallium 🛰️ 82% of the world's Tungsten 🛠️ 95% of the world's Magnesium ⚙️ When China restricted Gallium and Germanium exports recently, prices spiked and supply chains shuddered. For a semiconductor industry that relies on these for fabrication, this is a national security emergency. 🔄 The 2026 Shift The U.S. is finally waking up. By 2027, the Department of Defense is aiming to ban all Chinese-sourced rare earth magnets from its systems. From funding processing plants in Australia to exploring "Next Alaska" opportunities in Greenland, the race for Mineral Independence is the new Space Race. The Bottom Line: You can have the best pilots and the smartest engineers, but if you don't own the supply chain, you don't own your defense. Source: Jack Prandelli on X, Visual Capitalist #NationalSecurity #SupplyChain #DefenseIndustry #RareEarths #Geopolitics #TechStrategy #Manufacturing

With steel and aluminum tariffs going into effect today, I wanted to share data compiled from the U.S. Geological Survey (USGS) Mineral Commodity Summaries (https://lnkd.in/djQAiCc5) for iron and steel from 1991 – 2024 (note, 2024 data is estimated). Two charts. Thoughts: •Top chart shows millions of tons of steel production. The watershed event in the last 34 years was the Global Financial Crisis, with production in 2009 falling to just 59.4 million tons. Production subsequently had two peaks in 2012-2014 and 2018-2019. Production has not gotten close to late 1997-2000 or 2004-2007 levels since the GFC ended. •Bottom chart shows the correlation between net import reliance relative to apparent consumption of steel (X-axis) and domestic steel production (Y-axis) for all years excluding 2009 (due to the GFC being a clear outlier). Critically, we see a small positive correlation (r = 0.185) between the series, suggesting that greater reliance on imports doesn’t negatively affect domestic production (the opposite in fact). Let me reiterate that point to the pro-tariff community: U.S. domestic production of steel doesn’t fall for years where we rely more on imports. Implication: with steel tariffs in effect, we can expect continued upward pricing pressure for steel as domestic mills raise prices (exactly as they did in 2018), to the detriment of the tens of thousands of manufacturing plants in downstream industries that consume steel. There simply is no basis looking at the data to conclude that steel imports hurt domestic production (that bottom scatter diagram is conclusive). Rather, we should expect higher prices for steel to make downstream users less competitive in the global marketplace than their peers in Japan, South Korea, or the EU. If history repeats itself, this will have long-term negative consequences based on prior research (https://lnkd.in/d6CeCaqA). #supplychain #supplychainmanagement #economics #markets #manufacturing #freight  

The growing complexity of supply chain interdependencies is creating significant cybersecurity risks. In my latest article for the World Economic Forum’s Centre for Cybersecurity, I outline five key risk factors and what organisations must do to mitigate them: 1️⃣ Cyber Inequity – Large organisations are improving cyber resilience, but SMEs remain vulnerable. They must view cybersecurity as a business priority, while industry collaboration and policy support can help bridge the gap. 2️⃣ Limited Supply Chain Visibility – Expanding supply chains make it harder to assess supplier security. Without clear incentives, compliance gaps persist, increasing exposure to cyber threats. 3️⃣ Third-Party Software Vulnerabilities – AI and open-source adoption introduce new risks, yet only 37% of organisations assess AI tool security before deployment. A structured security framework is essential. 4️⃣ Dependence on Critical Providers – Over-reliance on a few key suppliers creates systemic points of failure. Resilient IT architectures and strong business continuity planning are critical. 5️⃣ Geopolitical Risks – Cyber threats are increasingly shaped by global tensions, disrupting supply chains and increasing attack sophistication. Organisations must integrate geopolitical risk assessments into their cybersecurity strategies. 𝗪𝗵𝗮𝘁’𝘀 𝗡𝗲𝘅𝘁? Organisations must prioritize visibility, support smaller partners, and invest in resilience. Strong business continuity planning, robust IT management, and proactive threat detection are non-negotiable. Cybersecurity is not just an IT issue—it’s a strategic imperative. Read the full article here: https://lnkd.in/g-yQ2QRa #CyberSecurity #SupplyChain #AI #RiskManagement

In a chapter co-authored with Udit Mathur for IDFC Foundation’s India Infrastructure Report 2024, we examine the twin resource challenges shaping India’s clean energy transition: critical minerals and water. As deployment of solar, wind, and storage accelerates, securing access to critical minerals is essential. We outline five strategic priorities for the Government’s Critical Minerals Mission—ranging from long-term planning and exploration to processing capabilities and international partnerships. We also highlight the water risk: India holds just 4% of the world’s freshwater but supports 18% of its population. With renewables expanding in water-scarce regions, we recommend stricter enforcement of water-use norms and cluster-level planning. Our core argument is that with anticipatory policy, institutional reform, and global collaboration, India can deliver on its energy transition goals without being constrained by these vital resources. #EnergyTransition #IIR2024 #ReNewTheFuture Ministry of New and Renewable Energy (MNRE) MoEF&CC

💥Another Amazon Web Services (AWS) outage. Another wake-up call. This morning, I planned to work on my course, but Canvas LMS didn't load. A day off for students and educators? Realizing how massive the outage is stopped me in my tracks. Why does it take a disaster to remind us of basic risk management? It shouldn't be reactive. And business continuity should be priority. By now we must have realized that centralized infrastructure = centralized risk. No? We've been sold the cloud as the only solution for IT infrastructure. But relying on a single provider is not strategy. It's blind hope. Most IT professionals are only trained on #AWS and its services. Few even attempt thinking beyond that box. And when convenience trumps common sense, failures become inevitable. Maybe add this to your next board meeting agenda: If AWS/Azure/Google Cloud went down for a week, what is our contingency plan? Here's what we can do: ✅ Diversify your cloud strategy. At minimum, have a secondary provider. ✅ Build for failure. Assume outages will happen and design around them. ✅ Train your teams to think beyond vendor-specific tools. Solutions don't always reside within a big cloud provider's ecosystem. ✅ Don’t be afraid to do something unconventional, like supporting your own servers, for example. ✅ Review your business continuity plan quarterly. Not amidst the next outage. Canvas LMS, Reddit, Inc., Snap Inc., Perplexity, Substack, FORTNIGHT, Roblox, Coinbase, Robinhood, Lloyds Banking Group, Bank of Scotland, United Airlines, Delta Air Lines, The Walt Disney Company, Prime Video & Amazon MGM Studios, Canva, Duolingo, and McDonald's are some of the apps affected by the outage in the US-EAST-1 #AWS region today. #AWSOutage #CloudOutage #RiskManagement #DevOps

President Trump announced 10% tariffs on all imports plus a bunch of “reciprocal tariffs on countries like China, Japan, Vietnam, Brazil and Indonesia among others. Statement from National Restaurant Association CEO Michelle Korsmo: “Applying new tariffs at this scale will create change and disruption that restaurant operators will have to navigate to keep their restaurants open. The biggest concerns for restaurant operators—from community restaurants to national brands—are that tariffs will hike food and packaging costs and add uncertainty to managing availability, while pushing prices up for consumers. "Restaurant operators know consumers are very sensitive to costs and have kept menu price increases to 30%, while their food costs have gone up 40% in the last five years. “Restaurant operators rely on a stable supply of fresh ingredients year-round to provide the menu items their customers want and expect. Many restaurant operators source as many domestic ingredients as they can, but it’s simply not possible for U.S. farmers and ranchers to produce the volumes needed to support consumer demand. "During this time of change, we’ll provide our members of all sizes with economic research to support their decision making and convene supply chain experts across the industry to share efforts for the best outcomes for restaurant consumers and the business viability of restaurants. "The National Restaurant Association will also continue to share with the White House the real-life challenges these changes present for restaurant operators and ask to have food and beverages exempted from these tariffs.”

Real time is how we win in supply chain. This infographic shows 7 real-time alerts your supply chain dashboards MUST trigger: # 1 - Stockout Risk Alert ↳ Triggered when projected inventory hits zero before next replenishment arrives ↳ Why it matters: prevents revenue loss and firefighting # 2 - Sudden Demand Spike / Drop Alert ↳ When daily/weekly demand deviates beyond a defined threshold (e.g., +30%, –25%) ↳ Why it matters: helps you react before MPS/MRP gets distorted # 3 - Supplier Delay Alert ↳ Triggered when a PO moves past expected delivery date or ASN doesn’t arrive on time ↳ Why it matters: lets you escalate, expedite, or reallocate stock instantly # 4 - Capacity Overload Alert ↳ When planned production exceeds machine/labor capacity in the next 1–4 weeks ↳ Why it matters: you fix overload before it creates backlog # 5 - Low Service Level Alert ↳ Triggered when OTIF or fill rate for any major customer dips below the threshold ↳ Why it matters: saves customer relationships before the damage is done # 6 - High-Risk SKUs Alert ↳ List of SKUs with: rising forecast error, low coverage, high volatility ↳ Why it matters: guides planners to where attention is truly needed # 7 - Inventory Imbalance Alert ↳ Spike in excess at one warehouse + shortages in another ↳ Why it matters: enables fast rebalancing instead of emergency shipments Any others to add? Ready to apply these tools in your real supply chain situations? Join me inside the Supply Chain Planning Circle community. https://lnkd.in/eVbY5YJF

Procurement prevent business disasters every year But leadership thinks it didn’t happen. Procurement teams love to say “we prevent risk.” But when the CFO asks “Show me the value” the room goes quiet. Here’s how to make risk mitigation measurable (and CFO-proof) 👇 1️⃣ Quantifiable Metrics (tangible value) Risk mitigation isn’t fluffy. It’s financial. ➟ Cost avoidance → “We avoided £2M downtime by spotting supplier risk early.” ➟ Risk exposure reduction → [Risk Score Drop] × [Potential £ impact]. ➟ Insurance premium cuts → Savings from better supplier risk posture. ➟ Avoided spot buys → £500K saved by dual sourcing instead of last-minute air freight. ➟ Mitigation ROI → (Value avoided − Cost of initiative) ÷ Cost. 2️⃣ Operational KPIs (leading indicators) Not £ in the bank, but resilience in action: ➟ % suppliers with risk scorecards ➟ % contracts with risk clauses ➟ Dual-sourcing coverage ➟ Supplier onboarding time with compliance checks 3️⃣ ESG & Regulatory It’s not optional anymore. Avoiding fines, sanctions and brand damage is measurable. Ex: “Avoided £1M penalty via forced labour checks.” 4️⃣ Scenario Modelling Run the “what ifs” with Finance: ➟ Supplier failure ➟ Material shortages ➟ Currency swings ➟ New regs Ex: Plan X cuts exposure from £3.2M → £200K in 12 months. 5️⃣ Executive Scorecards Wrap it all into a dashboard: ➟ Incidents prevented ➟ Cost/value impact ➟ Mitigation initiatives in play ➟ Residual risk exposure Procurement’s problem isn’t that risk mitigation lacks value. It’s that we don’t show it in numbers, stories, and dashboards leadership can’t ignore. 👉 So here’s my challenge to you: If your CEO asked tomorrow “what value did risk mitigation deliver this year?” could you answer with proof, or just with a story? Risk without numbers isn’t strategy. It’s hope. And hope isn’t a line item your CFO will sign off.

We are at a pivotal moment. 𝗧𝗵𝗲 𝗴𝗹𝗼𝗯𝗮𝗹 𝗼𝗿𝗱𝗲𝗿 𝗶𝘀 𝘀𝗵𝗶𝗳𝘁𝗶𝗻𝗴—𝗳𝗮𝘀𝘁, 𝘂𝗻𝗽𝗿𝗲𝗱𝗶𝗰𝘁𝗮𝗯𝗹𝗲, 𝗮𝗻𝗱 𝗱𝗲𝗲𝗽𝗹𝘆 𝗶𝗺𝗽𝗮𝗰𝘁𝗳𝘂𝗹.   Nowhere is this more evident than in the Asia-Pacific, which accounts for ~40% of U.S. imports across key sectors. In my recent conversations with CEOs across the region, one thing is clear: amid the uncertainty, leaders are moving decisively and recalibrating. They are responding with quiet intensity and structural action.    In these times of change, CEOs must focus on the following: 𝟭. 𝗗𝗶𝘀𝗿𝘂𝗽𝘁𝗶𝗼𝗻 𝗶𝘀𝗻’𝘁 𝗰𝗼𝗻𝘁𝗿𝗼𝗹𝗹𝗮𝗯𝗹𝗲, 𝘁𝗵𝗲 𝗿𝗲𝘀𝗽𝗼𝗻𝘀𝗲 𝗶𝘀 - Assess your product portfolio for tariff exposure. Key sectors such as steel, automotive, and electronics are already feeling the brunt of rising tariffs. Refine your pricing strategies and reconfigure supply chains to better navigate these impacts. 𝟮. 𝗧𝗵𝗲 𝗳𝘂𝘁𝘂𝗿𝗲 𝗯𝗲𝗹𝗼𝗻𝗴𝘀 𝘁𝗼 𝘁𝗵𝗼𝘀𝗲 𝘄𝗵𝗼 𝗮𝗻𝘁𝗶𝗰𝗶𝗽𝗮𝘁𝗲 𝗶𝘁 - Scenario-based planning is essential. Build flexible models that account for both direct and ripple effects of trade shifts—agility is your strategic edge. 𝟯. 𝗙𝗹𝗲𝘅𝗶𝗯𝗶𝗹𝗶𝘁𝘆 𝗶𝘀 𝘁𝗵𝗲 𝗸𝗲𝘆 𝘁𝗼 𝘀𝘁𝗮𝗯𝗶𝗹𝗶𝘁𝘆 - Shifting production and sourcing to regions with lower tariff exposure presents a unique opportunity to minimize cost impact and maintain competitive advantage. 𝟰. 𝗗𝗼𝗻’𝘁 𝗷𝘂𝘀𝘁 𝗿𝗲𝘀𝗽𝗼𝗻𝗱—𝗹𝗲𝗮𝗱 - Set up a cross-functional team to track tariff developments and implement rapid responses. A proactive, collaborative approach turns disruption into opportunity, rather than simply weathering the storm.   In a world where change is constant, the ability to adapt quickly is not just an advantage—it’s a non-negotiable for sustained success.    Read more from our Global Advantage team on how we are helping businesses navigate this new reality with precision and foresight: https://lnkd.in/ert8gazK   #TradePolicy #AsiaPacific #Tariffs #GlobalEconomy #BCGInsights

For those of us closely following the critical minerals ecosystem, the International Energy Agency (IEA)’s Global Critical Minerals Outlook 2025 distils the key trends that we have witnessed firsthand: growing concentration in supply chains is now a grave concern, making diversification the watchword for energy security.   Despite the surge of lithium demand to nearly 30% in 2024, the findings reflect a price drop by 80% since 2023, driven largely by increased output from dominant producers. Such price volatility masks a deeper vulnerability by 2035, excluding the top producers, global supply would meet only half the projected demand. Any disruption, be it geopolitical, climatic, or technical can trigger severe supply shocks.   This holds particularly true for graphite, the unsung backbone of the EV battery revolution. While its demand grew by 6–8% last year, with the energy sector now accounting for the lion’s share, over 70% of graphite refining remains concentrated in China. This has raised serious concerns about downstream capacity built-up and its role.   Long recognizing these structural risks, Epsilon Advanced Materials Pvt. Ltd. has focused on building integrated facilities across India, North America, and Europe to cater to the entire value chain. This strategy has enhanced our control over supply and quality, while also reduces exposure to global chokepoints.   I believe that building a resilient and diversified supply chain is not only feasible, but imperative. When we step back and see the forest for the trees, it becomes clear: true energy transition rests on secure access to materials like graphite and a long-term vision can help us achieve this, at scale.   Read the report here: https://lnkd.in/dT5mbhT6   #CriticalMinerals #Graphite #BatteryMaterials #EnergySecurity #SupplyChain #Epsilon #EVTransition #Clean #Energy