January 2009


Making supply chains work

Making supply chains work

“If somebody bought it; somebody brought it” said my Yorkshire born Uncle when I told him that I was working in Logistics many years back. I had become an ardent advocate of the new rocket science and such common sense logic seemed to bring all talk of sophisticated materials handling equipment back to earth with a thud. 

Take a look at how things move in remote rural areas or, in crowded cities worldwide and those images of bicycles, tricycles, rickshaws, handcarts and wheelbarrows carrying goods in all sizes, food, water and people and it seems a world away from sophisticated logistics. However, even the Dabawallas featured in a Post below – Green Distribution in a Mega City – have a Six Sigma classification.

Such basic transportation is far from anachronistic; it provides vital – and affordable – portability and innovative designers worldwide are working hard to improve pay load and productivity of even the most basic form of transportation. So, can multi modal transport mean more than trucks, rail, boats and planes? What about low cost improvements in the carriage of goods all along the supply chain? (more…)

The Mexicans say that you die twice; first when you stop breathing and second, when people stop talking about you. January 26th, 2009 marks the 250th Anniversary of the birth of Robert Burns and with 80,000 members of Burns clubs worldwide and 18.8 million references on the web Burns is more than a topic of conversation.

In 2004, Kofi Annan gave the Memorial Robert Burns Memorial Lecture at the United Nations in New York. His theme, The Brotherhood of Man and his words provide a facinating insight into how relevant the words of the Rhymer are to an understanding of the essential dignity and relevance of  the Majority World in our ever more globalised world. (more…)

On December 31st 1899 a millenarian cult set fire to their homes and possessions because their leaders were sure that the end of the world was on its way. Assured of certain certainties, they waited for apocalyptic collapse singing hymns as their local world went up in smoke. 

Here and now as economies seem to talk themselves into a downturn even worse than we are in, we should be careful not to torch the one resource that can make an upturn sustainable – human resources and their skills.  

These are challenging times and many governments promise major investments into infrastructure as a means to trigger an elusive upturn in a troubled world economy. President Obama will sanction major investment into Americas creaking hardware (road, rail and air networks) and, software in the shape of broadband. $600 billion will be spent within 18 months ; creating up to 4 million new jobs. Other countries will follow.

What about peopleware and skills? Will there be commensurate global commitment to skills or, will training budgets be slashed and a generation lost? Crucially, have we the leadership and imagination in government and business to be inclusive with the informal economy?

The Last Mile Video that has triggered significant debate on this Blog highlights the issues that any emerging economy or, one that has been dislocated by war or natural disaster faces. The ingredients of sustainable growth may be there on the planning horizon but, the road (port, rail or airport) to get there may be wrecked; unfit for purpose or just not there. Look again…

(more…)

“What the hell can a slum dog possibly know?” asks one of the fraudsters of the tea boy who answers all the quiz show questions in the film Slum Dog Millionaire. It is a good question that many branded goods and services marketeers have to ask as they assess potential in emerging markets. The answer is – rather a lot and, in terms of market size, we are speaking of the Majority World and a market that no brand can afford to ignore; fail to adapt to and learn from.

Success is not just about selling what works in the Shopping Malls at a lower price point or, that hard earned demand will be met by seamless supply. After all, the strength of a chain is the weakest link and that may well be pressured further when the monsoon comes…

Key questions need to be answered all over again. What makes someone buy? What benefits does the product or service generate? Is the product or service available? After all, the people of the slums and remote rural districts are more aware of their needs and product performance than most. This is the brands new world. (more…)

Every day in Mumbai 5,000 semi literate Dabawalas of the Nutan Mumbai Tiffin Box Suppliers Charity Trust deliver lunch to 200,000 office workers within a 60 kms radius inside three hours. The meals are home made, served up in a drum shaped aluminium daba,  the Hindi word for a box, and the whole process operates to six sigma standards – one service error in 16 million transactions. Each Dabawala serves 35 customers each for $6 a month. They walk, they cycle, they catch trains and each daba moves through 4 pairs of hands a day. Carbon footprint? (more…)

WDR 2009 – Reshaping Economic Geography – highlights that whilst Global Economic Growth will be unbalanced; development can still be inclusive. The Report focusses three key urban development issues density, distance and division and demonstrates how these spatial dimensions play a crucial role in the transformation of economic, social and environmental outcomes. Cities will not develop in an orderly fashion and, as the Report points out,

” informal communities will emerge and expand as the rising demand of workers and firms outstrips the capacity of governments to institute well functioning land markets and to invest in infrastructure and accomodation”

We must not ignore a parallel need to develop rural connectivity to local, national and global markets or, we will trigger an even faster migration to the Cities and exacerbate already significant congestion. One thing is for sure, as Professor Martha Chen and others have pointed out many times elsewhere, the informal economy is not going away. So, what are we going to do about infrastructure, logistics and the informal economy?

This Report supports the urgent need to develop innovative models that explore synergies between the informal and formal sectors and the transformative role of logistics plays a huge part in its conclusions. (more…)

Elsewhere, we have looked at the carpet industry and the workings of informal sector producers with the formal retail economy. See Post below. Let’s consider Leather in India.

Of 6.6 million metric tonnes of leather produced worldwide in 2004, Developing countries generate 60% and this is increasing year-on-year. After China and Italy, India is third in size with 3% of the global market generating an estimated 2 billion sq ft of leather. This is up to 7% of Indian Exports which have grown from $2.4 billion (2004/05) to $3.47 bn (07/08) and were expected, before the current crisis, to climb to over $5 bn by 2010. Indian figures compare with China exports having grown from $11.76 bn (2001) to $32 bn (2005). In both countries, the Leather industry is the leading light production industry.

Working with Leather in Dharavi, Mumbai

Working with Leather in Dharavi, Mumbai

The industry has seen a significant shift in recent years from exporting raw materials to added value design based products. In particular, footwear is regarded as the engine of growth. Also, increasing attention is paid to accessories and packaging as part of a more sophisticated offering. It is an excellent case study of all of the issues facing any industry that straddles the informal / formal sectors.  Especially in terms of how enabling infrastructure and logistics techniques and skills can transform economic, social and environmental outcomes. (more…)

Next Page »