Character and integrity will usually trump intellect. Business laws exist to control weak individuals, integrity controls great individuals. When building an organization, character and integrity are investments that don’t fail.
Sunday, June 5, 2011
Friday, April 8, 2011
Rare Earth Legislation
Coffman RESTART Act Creates Rare Earths Supply Chain-Seeks to Curtail Dangerous Reliance on China for Critical Materials
These are the key provisions of the legislation, items 1 & 3 will help the situation. The others would be better left out. The market will correct this supply and price problem once alternate mines are in operation and start producing.
These are the key provisions of the legislation, items 1 & 3 will help the situation. The others would be better left out. The market will correct this supply and price problem once alternate mines are in operation and start producing.
1. Directing appropriate federal agencies to expedite the permitting process in order to increase the exploration and development of domestic rare earth elements, without waiving environmental laws, and establishing a multi-agency Task Force to carry out this process;
2. Setting up a Defense Logistics Agency (DLA) rare earth inventory -- where DLA enters into long-term supply contracts and then makes the supplies available for purchase to federal government contractors -- to generate a domestic market and facilitate the domestic sourcing of rare earth alloys and magnets;
3. Making loans, backed by the federal government, available to start production should lending from the capital markets not be available;
4. Requiring the various cabinet Secretaries to appoint Executive Agents for rare earths;
5. Establishing a rare earth program at the U.S. Geological Survey.
2. Setting up a Defense Logistics Agency (DLA) rare earth inventory -- where DLA enters into long-term supply contracts and then makes the supplies available for purchase to federal government contractors -- to generate a domestic market and facilitate the domestic sourcing of rare earth alloys and magnets;
3. Making loans, backed by the federal government, available to start production should lending from the capital markets not be available;
4. Requiring the various cabinet Secretaries to appoint Executive Agents for rare earths;
5. Establishing a rare earth program at the U.S. Geological Survey.
http://coffman.house.gov/index.php?option=com_content&view=article&id=436:april-6-2011-coffman-restart-act-creates-rare-earths-supply-chain&catid=36:latest-news&Itemid=10
Thursday, March 17, 2011
Supply Chain Risk and Mother Nature
Our hearts go out to the folks in Japan as they are in the midst of crisis with 3 events all caused by mother nature.
Natural disaster has historically been the most frequent cause for supply chain disruption. The current crisis in Japan is significant for many manufactures. Electronic components are the biggest challenged commodity types. Customers want answers now and suppliers are bombarded with the question "what is the supply impact?". Unfortunately, the answers are incomplete given the reality of a crisis still in process. Most manufactures had inventory in transit or stock to cover them through March. April is a different story with a lot of uncertainty. We should expect at the very minimum there will be reduced supply of at least 1-2 weeks for anything produced in Japan. The direct impact of the earthquake, tsunami and nuclear facility damage is not the only contributor. How about the human distress, reduced productivity, absenteeism, power outages throughout the country, exit of people, damage to logistic lines and infrastructure.
Alternate supplies can be used where qualifications are already complete or on less technical product which has low risk from design or source changes. These alternatives should be considered as we continue to work with Japanese suppliers through full recovery and clarity.
Natural disaster has historically been the most frequent cause for supply chain disruption. The current crisis in Japan is significant for many manufactures. Electronic components are the biggest challenged commodity types. Customers want answers now and suppliers are bombarded with the question "what is the supply impact?". Unfortunately, the answers are incomplete given the reality of a crisis still in process. Most manufactures had inventory in transit or stock to cover them through March. April is a different story with a lot of uncertainty. We should expect at the very minimum there will be reduced supply of at least 1-2 weeks for anything produced in Japan. The direct impact of the earthquake, tsunami and nuclear facility damage is not the only contributor. How about the human distress, reduced productivity, absenteeism, power outages throughout the country, exit of people, damage to logistic lines and infrastructure.
Alternate supplies can be used where qualifications are already complete or on less technical product which has low risk from design or source changes. These alternatives should be considered as we continue to work with Japanese suppliers through full recovery and clarity.
http://www.businessweek.com/magazine/content/11_13/b4221018714000.htm?chan=magazine+channel_11_13+-+japan+crisis_japan+crisis+sr
Friday, January 7, 2011
Secure the supply chain
This is an interesting significant initiative and most people don't give it much consideration. The article does a good job highlighting the importance and the magnitude in achieving a secure supply chain. There are huge economic and safety repercussions. It also suggests part of the strategy should be to build in duplicity to minimize economic disruption due to a failure. It will clearly require a global, international, collaborative focus, and this will be difficult. It declares this will be a 2011 focus and I agree it should be.
http://online.wsj.com/article/SB10001424052748704723104576062224066075598.html?KEYWORDS=secure+supply+chain
Thursday, January 6, 2011
The outlook improves
2010 was clearly an improvement over 2009 and it appears in 2011 the trend will continue. This will present different types of challenges for purchasing professionals. Less supplier financial stress will start to be replaced by materials cost pressure. Specifically inflation of most raw material commodities i.e. copper, resin, steel, rare earth, oil, etc. High inflation in China is already in process, In addition, RMB currency risk must be watched as it gains value on the dollar. Good purchasing organizations will continue to get productivity with focus on fundamental strategic sourcing process.
http://www.scdigest.com/ONTARGET/11-01-03-1.PHP?cid=4043&ctype=content
http://www.scdigest.com/ONTARGET/11-01-03-1.PHP?cid=4043&ctype=content
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