The volatility of oil prices is a big factor in driving uncertainty. The
global chemical industry depends heavily on oil for many key products. In the U.S., where natural gas is the key feedstock, chemical manufacturers have enjoyed something of a competitive advantage over
their foreign counterparts, says Weiss. Still, the exploitation of shale oil
and gas deposits in places such as Pennsylvania “could be incredibly
game-changing for the U.S.,” he says. “It could cause a resurgence in
the development of new chemicals.”
How Fair Trade Contributes to
Sustainable Supply Chains
Todd Stark, chief operating officer of Fair Trade USA,
describes the organization’s mission, and traces the growing
awareness by global companies of the need to ensure sustainable development at every step of the supply chain.
Consumer packaged goods companies are increasingly including
sustainability as a key factor in the design and management of their
global supply chains, according to Stark. Over the last few years, he
says, businesses have placed greater emphasis on their water and
electricity usage, as well as packaging materials. More recently, they
have begun assessing whether their practices are actually leading to
“improvements for the people who create those products all the
way back to origin.”
Fair Trade USA is a non-profit organization devoted to sustain-
able development and a market-based approach to alleviating
global poverty. It has crafted a rigorous set of social, environmental
and economic criteria for CPG brands. “We really are a trust
provider for many companies,” says Stark. “We help their brands to
be recognized for doing things that are socially, environmentally
and economically good for their workers.”
Companies that meet the group’s criteria receive a fair-trade cer-
tified label which they can display on their products. Stark says it
aims to set aside funds for sustainable development of the commu-
nities in which workers live. By helping farmers to solve their own
problems, it provides long-term solutions and reduces their need
for international aid.
Established just 12 years ago, Fair Trade USA is still relatively
young. Already, however, it serves nearly 800 customers in the U.S.
alone. At the moment, coffee product accounts for 75 percent of its
business, although the group is also involved in standards for the
production of sugar, bananas, cocoa, honey, wine and flowers.
Stark says it is branching out of the grocery sector into apparel and
textiles. “There’s a breadth of companies interested in working with
us,” he says, “and the range of commodities has grown
dramatically in the last few years.”
Why Business Analytics Are
Critical to the Supply Chain
Investments by companies in new information technology have yielded huge amounts of data related to
the supply chain. Siddharth Taparia, senior director
for business analytics with SAP AG, shows how the
use of business analytics can help to harness that
data and improve performance.
Over the last decade, companies have invested heavily in
new information technology, including systems for enterprise resource planning and supply-chain planning and
execution. To handle the wealth of data required to support such systems, they are showing keen interest in business analytics, says Taparia.
At the most basic level, business analytics are a
means of measuring supply-chain performance. They
employ dashboards, reports, graphs and charts, based
on a handful of key performance indicators (KPIs).
They include such elements as forecast accuracy, days
sales outstanding and inventory days of supply. “From
executives in the boardroom to people on the shop
floor, everybody can have the information they need to
do their jobs easier,” Taparia says.
The first step toward embracing business analytics is
to secure the data that underlies global operations.
More of it has been generated in the last year than the
previous few decades combined, according to Taparia.