During my tenure as Dean of the Sobey School of Business at Saint Mary’s University, a mid-sized public university in Halifax, Nova Scotia, I could validate news and data coming from global markets with a less precise but far more immediate and palpable measure.
On a clear or even cloudy day, I could simply eyeball activity at the port of Halifax, North America’s first inbound and last outbound gateway, all happening less than two miles from my office window.
Over the past year, we have been reminded that while Amazon Prime strives to deliver the next day, that promise is only as good as Amazon’s ability to ship products from global manufacturing centers to its North American ports, intermodal hubs and warehouses.
Multiply that uncertainty by tens of thousands of companies, distributors, shipping intermediaries, retailers and customers, and you have yourself a genuine global supply chain disruption. Supply chain experts have labeled the coronavirus pandemic’s global effect a “black swan” event. While the analysis of why so many supply chains imploded may be complex, at root we know that trouble grew from over reliance on single suppliers and a lack of backup options.
Supply Chain at John Carroll University
We began teaching supply chain, logistics and global business at John Carroll University some 50 years ago. Much has changed in that time. Container ships ballooned in size in a herculean effort to lower costs. The model of just in time inventory management — one that requires working closely with suppliers so that raw materials arrive as production is scheduled to begin, but no sooner — became gospel. And over the last decade, digital consumption (e-commerce) produced a tsunami of data. Across the world, companies continue to translate that data into insights and process changes that transform the way they define and manage their supply chains.
Well before the black swan landed, John Carroll began to invest in tools and teaching approaches to prepare a new generation of supply chain managers to deploy data analysis tools and techniques. That investment is ongoing; only now it has more relevance and urgency than ever as companies seek structured processes to explore, evaluate and capture big data opportunities in their supply chains.
Opportunities for supply chain leaders will continue to evolve. Once content to simply get the right goods/services to customers in the right quantity at the right time (improved materials flow and production optimization), the goal post has moved. Today, managers face a new challenge — imagining a more integrated and mission critical supply chain management role. Linear supply chains will surely morph into more complex and adaptive networks that hold both far greater risk and opportunity for companies.
In the past, supply chain expertise was viewed as a tactical asset. Managers viewed tradeoffs between doing it cheaper (cost containment) and doing it better (product/service innovation) as inevitable. Today, in the wake of a pandemic, supply chain leaders look to avoid such compromise by helping companies do more than one thing well, including:
- control costs
- anticipate disruptions
- factor in design/sustainability considerations
- manage supplier and customer relationships
- track competitors
- commercialize more and better products
Information is supply chain management’s currency
A persistent challenge during the pandemic has been not having vital information readily available or accessible across global teams. Companies scrambled to learn which suppliers, sites, parts, and products were at risk. Disruption came so quickly, and was so widespread, that no simple route to alternative sources could be identified to avert a crisis.
A few months ago, that port in Halifax (naturally deep, wide, ice-free, with minimal tides) welcomed the Marco Polo, the largest container ship to ever call on North America’s east coast. With a capacity to carry more than 16,000 shipping containers, the ship represents a potential game changer, and not just for Halifax (two days closer to Europe and one day closer to Southeast Asia (via the Suez Canal) than any other North American East Coast port.
The Marco Polo delivered everything from clothing to household goods and electronics, a vastly different load than what we primarily see in Great Lakes-St. Lawrence River ports from Cleveland to Toledo, Michigan and beyond. Policies and port limitations mean that most goods passing our way are single product shipments — inbound coal or outbound Iowa grain or Minnesota iron ore pellets — destined for a single port.
Cleveland made a significant investment a decade ago to handle more container ships, but the pay off so far has been limited. We use less than 10% of our full container capacity. It will take smart supply chain management thinkers to re-imagine our system and restore greater flexibility and resilience to the entire U.S. shipping system, including inland ports such as ours.
When we talk about transforming John Carroll University in ways that bring us to the applied edge of the liberal arts, it’s not a theoretical exercise. We have the faculty, alumni and partners needed to bring real change in areas such as supply chain management. We have working models to study and adapt, such as when large vessels sail from Cleveland to Belgium, only then to connect with even smaller vessels to get in and around Europe.
Last week’s signing of the single largest federal investment in American history will include $17 billion in infrastructure improvements at coastal and inland ports, waterways and ports of entry along the U.S.. The Biden administration will begin work within the next 60 days with the U.S. Army Corps of Engineers on $4 billion worth of construction work at coastal ports, inland waterways as well as other corps eligible facilities.
The plan will also identify and prioritize $3.4 billion in upgrades to obsolete inspection facilities that will make international trade more efficient through the northern and southern borders.
Our role and responsibility as a Jesuit university is to engage all questions, contemporary and eternal, to meet this moment and work to bring about a better world and improved lives for everyone. Right now, that question is as basic as this: how do we better connect the Halifax port to partners and people across Northeast Ohio, the Midwest and places in every direction across the U.S.
Photo courtesy of the Port of Cleveland.
