Tunnel Vision.

By Steve Geary | 05/29/2017 | 5:52 AM

Gartner is out with their “Top 25” list of supply chain performers for 2017.  Number 1 is Unilever, followed by McDonalds, Inditex, Cisco Systems, and H&M.  Scroll all the way through and there is no doubt:  it’s an impressive and diverse group of high performing supply chains.

Yet there is a conspicuous gap.  Where are the government supply chains?  Where are the defense folks?  Where are the NGO’s?  In Gartner’s defense, stories of ineffective performance in government, defense, and NGO procurement are common.  But does that mean that all of these supply chains are inherently poor performers?  Or is Gartner the victim of tunnel vision and selection bias?

The government establishment is surely guilty of tunnel vision.  According to Forbes magazine, “The Pentagon has long relied on the incumbent Beltway-centric contractors, which build overpriced, underperforming, custom-made products.”

Insular thinking and tunnel vision are dangerous.

I browsed through the Gartner results sitting in a Starbucks – another company recognized on this year’s Top 25 list.  I was nibbling on a muffin, drinking coffee, and sipping from a carton of milk.  The milk came in one of those boxy cartons, where you push the straw through a hole in the top, using the straw that comes taped to the side of the carton.

Then the light bulb came on.  I first became acquainted with that style of packaging in Iraq, sitting in a Forward Operating Base (FOB) military dining facility (DFAC) eating dinner in 2007.  That fresh milk outside of Baghdad was not sourced locally.  That milk came, along with fresh fruit, vegetables and just about everything else we ate, all the way from the West.

That high performance supply chain was managed by a private sector service provider under a government contract.  Fresh milk, fresh fruits, and fresh vegetables served in a barren, scorching, desert war zone, delivered by a private sector defense contractor.  Why aren’t there any government supply chain actors on Gartner’s list? 

Consider Boeing.  These are the folks who, among other things, support NASA and help keep the crews on the International Space Station supplied.  Now that’s a logistics challenge that few others have ever tackled.

And then there is Lockheed Martin.  As far as I can tell, LMCO is the last government contractor to crack the Gartner “Top 25” list, back in 2010.  They remain formidable logisticians, providing supply chain services at a high operational tempo, from Korea to Southwest Asia, but they do no crack the list.

And let’s not forget The American Red Cross.  Quoting directly from their website, “From small house fires to multi-state natural disasters, the American Red Cross goes wherever we’re needed, so people can have clean water, safe shelter and hot meals when they need them most.”

Looping back to Gartner’s list, it is impressive and there are lessons to be learned from everybody on that list.  That said, high performance supply chains do not necessarily have high inventory turns or align to “corporate social responsibility goals,” as selected and applied by Gartner.  The metrics used by Gartner may be appropriate for some organizations, but not all sectors fit the Wall Street template.

Supply chains success is about delivering high impact outcomes, and while that may be congruent with commercial success, it is not synonymous.

Government spending accounts for something like a third of Gross Domestic Product, and while not as big as the private sector it is significant.  NGOs perform many “hard to do” functions that save and preserve lives in emergency and austere environments.  To fulfill their missions, government contractors and NGO’s often need world class supply chain capabilities.

To have a full spectrum view of logistics excellence, don’t ignore the Defense Contracts and NGO’s.

What’s in a name? Wrestle over the threat, not what people choose to call it.

By Steve Geary | 05/11/2017 | 6:26 AM

"What's in a name? That which we call a rose by any other name would smell as sweet." - William Shakespeare, Romeo and Juliet

Consider the term “Supply Chain Risk Management,” or the acronym SCRM.  Raise the issue, and a logistics leader will likely ask you to take a seat.

On the other hand, think about “cyber.”  Say that word to a logistician, and you’re likely to be sent down the hall to the folks in IT. 

Cyber considerations are all over the supply chain.  There are times when the first stop in a cyber threat is IT, but there are also a slew of issues where the operators need to lead.

Cyber is a risk, we have to manage it, and it’s in the supply chain.  How do cyber considerations impact sourcing?  Shipping?  Communications?  Subcontracts?  ECO's?  Industrial base management and oversight?  Payment methods and international money transfers?  The list is almost endless, and none of these examples are IT centric and all have a cyber component.

Here’s a citation the Defense Acquisition University offers to help students get their arms around Supply Chain Risk Management.  “Supply chain risk management (SCRM) is ‘the implementation of strategies to manage both everyday and exceptional risks along the supply chain based on continuous risk assessment with the objective of reducing vulnerability and ensuring continuity.’”

Cyber issues are just one of the risk vectors to consider in SCRM, and a good chunk of responsibility for that risk sits with the operators, not the techies.  If you’re more comfortable grappling with Supply Chain Risk Management, fine. 

On the other hand, if somebody knocks on your door to talk about cyber, ask them to take a seat and shock them with how cultured we are in the Supply Chain:  quote Shakespeare.

Five things government and government contractors should think about

By Steve Geary | 05/04/2017 | 10:44 AM

I recently read an interesting email newsletter from a friend of mine, Ann Noder at Pitch Public Relations™, and I salute my friend’s skill at getting my attention. 

Her piece was called “Ways to Take Control of Your Supplier Management Processes,” and a lot of her material has bled into this post. Supplier management is all about process, but how often do we turn our attention to the process we use to manage the supplier relationship management process?

According to Ann, “Supplier relationship management is hard enough—don’t make it harder by giving in to internal disorder. Starting with that first key step of going paperless, these simple suggestions will help your organization focus on improving efficiencies, supporting compliance, and building healthier supplier relationships while mitigating risk.”

In February of 2017, the GAO issued their latest review of risk areas in the Supply Chain. Their key findings: 

Inventory management

DOD's inventory management practices and procedures have been ineffective and inefficient. DOD has experienced high levels of inventory that were in excess of requirements and weaknesses in accurately forecasting the demand for inventory items.

Materiel distribution

DOD has faced challenges in delivering supplies and equipment, including not meeting delivery standards and timelines for cargo shipments as well as not maintaining complete delivery data for surface shipments.

Asset visibility

DOD has had weaknesses in maintaining visibility of supplies, such as problems with inadequate radio-frequency identification information to track all cargo movements.

Sadly, the DoD is not unique. Every government department faces challenges. These challenges are compounded by the government’s inherent instinct to overlay bureaucracy on any process and the vast amount of data on the loose in the supply chain. In the land of government contracting across the supply chain, streamlining the supplier relationship management process isn’t just low-hanging fruit; it’s a field of ripe watermelons lying on the ground.

So, let’s overlay five  recommendations in Ann’s column—drawn from Progressly, which helps companies move from paper to digital—against the federal government. 

1. Go Paperless

The government is ahead of their private sector support contractors. For example, the federal government has established a central repository, the System for Award Management (SAM). This is an official website of the U.S. government. There is no cost to use SAM. You can use this site for FREE to register to do business with the U.S. government, update or renew your entity registration, and generally take care of what needs to be taken care of to maintain certifications.

Contrast this to the processes used almost universally by prime contractors. They typically organize by project, and so for every new opportunity or engagement the subs need to fill out a new batch of paperwork. Great from the primes point of view, but adds to overhead and total cost, and introduces opportunity for error. Hardly best business practices.

2. Maintain Your Records

Keep your records up to date. Having a clear assessment and inventory of existing contracts is vital, and the best way to do that is to digitize. The same holds for performance level agreements and performance reports. Have a single point of contact accountable for the portfolio, and do a management review quarterly. Unfortunately, with the constant turnover in government programs, both on the government side and the contractor side, this level of diligence is necessary.

3. Make Sure Internal Controls Are Efficient

Effective control is more than password protection or a lock on the file cabinet door. Design the process and streamline it. There is a military department that has defined a rigorous and logical supply chain oversight process. Unfortunately, it is serial, and each step on the review process goes all the way up to the top of the organization, with check steps at each level of the hierarchy. Sometimes the duration of the performance review cycle—and this is a logistics oversight process—can take months.

4. Simplify Your Collaboration Tools

Email isn’t a collaboration tool. Maintaining files in the cloud can be. Shared databases surely are.  Standardize date, eliminate duplication, and focus on the vital few. Data is a means to an end, not an end in itself. 

Estimates of the additional oversight costs associated—as reported by a study performed at the University of Tennessee—may be as much as 25% of the budget. The Federal Acquisition Regulation (FAR Part 15) is the antithesis of streamlined and efficient supply chain oversight.

5. Drive Accountability and Transparency

There are key steps you can take to boost efficiency without sacrificing quality. Apply good management practice and assign ownership. If everybody owns it, then nobody owns it.  Use technology that ensures the approval process is both easily accessible by key stakeholders and easy for them to understand and navigate. Make sure integrated technology and tools gives decision makers centralized access to everything they need to move a plan or a contract forward. The less time an approver spends digging around for missing info, the better.

Once defined and agreed upon, shared processes will drive accountability on both sides of the table. Ideally, your process management solution will also enable you to assign tasks and gain visibility on outputs and performance. These open collaboration tools will ultimately enhance collaboration as you shift from problem-finding to problem-solving—together.

Federal government silos - can they be broken?

By Steve Geary | 04/09/2017 | 5:05 PM

I’m a supply chain guy, so I hate organizational silos. 

Logistics, by its very nature, cuts across silo boundaries.  In a vertically organized company, an order drops into Sales and Marketing, flows through Operations to be configured, and then heads over to Logistics for fulfillment.  The final stop in the journey is likely Accounting, who handles billing and collections.

Many companies understand the inherent challenge of inward-focused silos.  Not all situations are the same, not all customers are the same, so a one-size-fits-all structured response rarely meets the specific requirements.  Through this lens, effective customer-facing organizational structures work to cut across functional boundaries and orient horizontally, focused on the customer, rather than vertically by function. 

At DC Velocity, we love to talk about Omni-Channel – a tag line describing synchronized market-driven responses tailored for individual customers, a horizontal construct if there ever was one.

Instead of a horizontal orientation, the federal government is built around silos.  The skeletal infrastructure of the United States Government is clear; just look at the names of the cabinet departments in the executive branch.  State, Treasury, Defense, Education, Homeland Security, Transportation, Justice are just a few examples of cabinet departments, and they, like the rest of the departments, are all silos.

The silo approach to organization is recursive:  it repeats and repeats and repeats, giving us silos within the silos. 

Overnight on April 6, 2017 we launched 60 cruise missiles – 59 made it to the target, a single airfield in Syria, in a response to Bashir Al Asad’s used of chemical weapons – AGAIN.  A recap of what has happened up to this point.  First, let’s imagine a red line and pretend we’ll do something if chemical weapons are used.  These idle threats from the previous administration obviously didn’t work, so the previous administration gave it to the VP and sent him off to work with the international community.  Yeah, like that moved things along - not.  Then we arrived at the final policy posture, let’s wait for the EU to do something . . .ah, they’re busy with Brexit. 

After a recent change of administrations, we wake up one morning to hear that the new President launched a missile strike. 

President Trump and his team weighed the variables and decided that throwing 60 cruise missiles at Shayrat Airbase might produce the desired outcome – no easy task considering the dramatic shift in our new national security approach.  If the desired outcome is to demonstrate that business as usual is no longer in play in Southwest Asia, maybe it was achieved, again no easy task because of the international actors involved.  And, to reinforce the more aggressive American stance against rogue actors internationally, on April 8 the Pentagon said that a group of US warships is headed to the western Pacific Ocean to provide a physical presence near the Korean Peninsula, instead of sailing to Australia, as previously planned. 

Military operations are government supply chains in action on a massive scale.  As with any supply chain decision, launching a military action considers an array of variables other than cost.  Cost is just one factor considered in the context of national and global security priorities.  We can only hope that the decision to launch these missiles was made with a clear understanding of the cost of the cruise missiles, but also with a clear understanding of the desired outcome. 

Does it take a sledge hammer to kill an ant?  NO.  But if you do it once, especially when you are trying to overcome 8 years of destructive paralysis on the world stage, slamming Asad’s forces makes sense if it produces the desired outcome on the global stage.  Based on comments from the international community, the world seems to understand that the United States is again ready to lead in Southwest Asia.

There are too many actors, too many agendas, and until now the lack of a cohesive strategy reduced the United States to play tit for tat on the global stage in the past – with the Trump administration, should this missile strike be viewed differently?  The previous administration was unable to assemble a proactive integrated action plan across the functional silos, but with a new President, the United States may now be beginning to behave in a different way.  That said, we don’t know the behind the scenes thought process of the administration, but we can hope they are taking a different approach that includes synchronization across the silos.

But true synchronization across silos costs money.  In just one night of missile launches aimed at Syria, we threw almost $100 million of metal at one airbase.  According to the Washington Post, our total economic and development assistance to Iraq budget for fiscal year 2017 is a little over $300 million.  There is imbalance among the silos.

If this was a straight up logistics problem at an operational level, we’d have a cross functional response –not just a military response - defined to fix the problem.  In an ideal global geopolitical world, we’d have a similar cross-functional approach that cut across departments and nations, focused on Southwest Asia, orchestrated by somebody reporting up to the president, and integrating the capabilities necessary and available to meet the circumstance in Syria.  The current administration includes some very experienced individuals at the Cabinet level – let’s hope that they are working feverishly to overcome the ingrained silos of our federal government.

Is it too much to ask that government departments function the way we operate on the warehouse floor?  When it comes to government operations, why do we treat silos as a fact of life?  Reality suggests that we need a whole of government solution, but we just haven’t figured out how to do that yet, it seems.  Maybe there’s hope on the horizon.

Uncertainty stinks.

By Steve Geary | 03/22/2017 | 1:48 PM

Relationships around the world are shifting, which means that the logistician’s world is becoming more uncertain.  Some people make money from uncertainty, but in our world we earn profits by making uncertainty go away.  That’s getting harder to do.

Consider trade relations.  Where are things going to end up with China?  What is going to happen with NAFTA?  The United Kingdom is leaving the EU, and it is entirely possible after their next national election France will follow.  The President is endeavoring to suspend immigration from a list of countries, and that is bound to have some impact on trade.

These may seem like big picture issues that are only of interest on the Sunday morning talk shows, but what if your company moves things back and forth to border plants just south of Texas for ultimate sale in the United States? 

Those sorts of concerns run both ways.  “ ‘We’ve invested a lot into the US and it would be a pity if some protectionism did come up,’ said Robert Saller, managing director [Delo, a company of little more than 500 people], referring to fears that the US president will increase trade barriers and jettison trade talks.”

There are more dimensions to what’s going on in Washington DC than trade policy.  Other policy areas have direct impacts on logistics.  What about OSHA regulations?  How will shifts at the EPA impact coal mining, or pipeline construction?  What about foreign aid through the Department of State?  Is the logistics operating environment going to become easier or harder . . . and when?  Crystal balls are more essential than ever when constructing a logistics forecast.

We will leave the debate over the possible benefits or detriments of these policy shifts to others.  There has always been uncertainty in what we do, but somehow over the last 12 months it has started to seem like arbitrage instead of risk mitigation.  We’re logisticians, and we just need to know what the rules are going to be.

We can deal with uncertainty, but are we descending into chaos or simply witnessing a global realignment?  Either way, it’s going to be interesting.

Immigration policy, border practices, and lessons from the warehouse floor

By Steve Geary | 02/24/2017 | 1:43 PM

In February, in a headline, the New York Times said, “Crackdown on immigration faces logistical hurdles.”  Logistics appearing in a headline in the New York Times?  We’re coming up in the world.

The lead in the article read, “President Trump’s efforts to secure the nation’s borders and get tough on illegal immigrants, announced just days after he took office, now face serious logistical problems along with the legal challenges that threaten his ability to make good on a central campaign promise.”

So how should the nation approach the issue?  There is a logistical problem, just like the article asserts, but it isn’t at all clear that the article is tackling the right one.  It would make sense to think about it just as we would look warehouse performance - a cornerstone in any logistics network. 

Inventory control 101 says that the first thing to do is compare policy and practice.  If the published rules don’t match the practice, then something needs to change.  Either change the rules or discipline the process.

It’s pretty simple:  if policy and practice don’t match, the system doesn’t perform as well as it could. 

That’s the situation we find with immigration in the United States.  We have developed a set of shadow immigration practices at odds with the law.  We either need to bring the immigration processes into compliance with the law, or change the laws.  Unless we do that, we are going to face continuing dysfunction and confusion.

Back in the days when I ran distribution networks, no matter how much I loved my customers and my employees, we had locks on the facility doors and gates protecting the stockrooms.  The analogy is clear. 

Secure the domain to control access and maintain integrity, or not.  It is a clear choice for most businesses.  This may be simple minded, but there just don’t seem to be any reason why the nation’s borders should be any different.

Now, before people flood my email with screaming diatribes, I’m not saying I agree with the policy the President is executing or the laws he is following.  It just seems to me that he is trying to follow the rules that are on the books.  The United States is supposed to be a nation of laws and the President is applying the law, not ignoring it.

So, here’s an approach, the same as it should be for anyone who doesn’t like inventory policies in a warehouse.  Don’t complain about the policy to the people who are responsible for executing the policy on the warehouse floor.  If you don’t like a policy, or in this situation if you don’t like the current law, then take it up with the people who write the laws.

Call or write your representatives in Congress, the place where legislation gets written.  I’m sure they would love to hear from you, but do all of us a favor, don’t just criticize, offer a recommendation for a solution to your concerns.

Finding Common Ground: bringing operations and accounting together

By Steve Geary | 02/06/2017 | 12:45 PM

Special thanks to Matt Hunt of Sehlke Consulting for assistance with this column.

Where is the common ground shared by operations and accounting professionals?  In fact, it often seems as if operations professionals and financial managers are pursuing conflicting goals.  Peel back the layers and get to the core, and you quickly discover that the two communities overlap with a vibrant and vital set of shared interest.  They just don’t speak the same language.

A military unit, in a galaxy far, far away, was working on a vehicle that wouldn’t start. The maintenance mechanics launched the same processes that they were taught, because “that’s how they’ve always done it”. 

Ah, the danger of standardization . . . sometimes, it helps to think.

Most back yard mechanics would immediately go for the battery. Alas, the vehicle would attempt to start, which meant it was getting power. Maybe it’s not getting enough power. Okay, order and replace the battery, but no luck. One day and a few hundred dollars down the drain.

We’ve all seen this movie.  In fact, we might have starred in it, going down the same path ourselves in the backyard with the family sedan.

If it isn’t the battery, it has to be the starter, right?  Fine, order and replace that. This field unit is not authorized or trained to repair starters, so the starter is pulled and sent to a maintenance center for an overhaul. Send it back, and trade it in for a rebuilt unit.  More time and more money invested into getting the vehicle up and running, and again no luck. Still the vehicle is “dead lined.”

Fast forward three months, the amount invested into finally bringing this vehicle back to life and over $13,000.  It turns out that the only part that needed to be replaced was a $1.38 fuse.  New fuse, and it fired right up.

Now, I’m a logistics knuckle dragger myself, so I completely understand the path this crew followed.  In fact, I could see myself doing the exact same thing, and once the vehicle was up and running I would be proud, and I’d let the budget guys worry about finding the $13,000 to pay for it.

Fortunately, there are useful accountants and auditors in the world, and they really can be a friend.  The starter scenario was uncovered by a team of auditors, and their discovery triggered a review and revision of training and maintenance protocols.  The accountants and operators worked together, added some brain cells, and came up with a better way.

Accountants and operators need to be on the same team.  Find the common ground, the shared issues, and the world becomes a different place.  One set of management controls – properly defined, integrated, and executed – advances the business along two fronts, financial oversight and operations.

Management controls in the broadest sense include organization plans, methods and procedures adopted by management to meet its missions, goals and objectives.  These management controls also serve as the first line of defense against fraud and violations of laws, regulatory violations, and compliance with provisions of contracts and business agreements.

While logistics and financial management share many of the same objectives, the two approach them from different perspectives using different language. Both aspects of business require clean and accurate data. Both utilize internal controls to ensure that business processes are working effectively and discourage fraud, waste, and abuse. Both business practitioners want the same thing; provide the best support possible to the government.

The National Defense Authorization Act of 2010’s mandate requires the Department of Defense (DoD) to have audit ready financial statements by 2017.  It’s time to break down the wall between auditors and operators.  Together, they can get the books cleaned up.

Dionna understands logistics, transportation, and markets. Why can’t the bureaucrats?

By Steve Geary | 01/25/2017 | 5:48 AM

I’m a fan of the ride service UBER, and my friends tell me that Lyft is just as impressive.  Whip out a smart phone, punch a couple of buttons, and pick a destination.  It’s actually faster than using your phone to call for a cab.  Usually in less than ten minutes you’re sitting in the back of a clean and well maintained vehicle, with a polite and well-dressed driver at the wheel, heading for your destination.  

This emergent transportation alternative to traditional taxis provides cleaner cars, more professional drivers, a faster response time, and in my experience it costs about half of what a traditional cab ride costs.  It is a demonstrably better product at a significantly lower price.  No wonder that traditional cabbies are feeling some heat. 

This morning my UBER driver was Dionna.  Dionna drives for Lyft, as well.  I was actually impressed with Dionna more than the UBER service, which says something, because I really like UBER.

Dionna understands logistics far better than your typical thirty-something, and more deeply than most government bureaucrats.  Each day she looks at the promotions that UBER has running for drivers, and what promotions that Lyft has running.  Somehow she also factors in an estimate of call volume on each of the services, and checks out the number of cars running.  Based on what she sees, she decides on which company she’ll drive for that day. 

I think they call that market research.  Dionna is doing real-time assessments of supply, demand and pricing.  I teach business at the collegiate and graduate school level, and I wish I had more like Dionna in my classes.  She gets it.

As for the customer experience, UBER costs about half of what a cab ride costs, the drivers like Dionna are more professional and the vehicles are cleaner.  It’s no wonder the market for taxi medallions is collapsing in places like New York City.

So why do we still have the antiquated infrastructure and regulations for cab licenses in our metropolitan areas?  Why are the regulators trying to impose restrictions and licensing requirements on UBER and Lyft, to make them more like cab companies?  Why aren’t the bureaucrats loosening restrictions on traditional cab companies to make them more competitive, rewarding innovation, not stifling it?  Instead, in many places government regulators are trying to add restrictions to UBER and Lyft to make them more like traditional cab companies.

Using UBER as a starting point, let your mind run free, and imagine rethinking transportation services – that is to say LTL trucking – or air transportation.  If it can work for taxis, why not rethink logistics infrastructure and capabilities on a broader scale?  If you think it is far-fetched, think again.  They already have test markets up and running.  And hey, are you ready for autonomous delivery vehicles – Amazon is talking about them. 

Internet-based logistics services are a shining example of how markets themselves can effectively self-regulate transportation and logistics value, and spur innovation more effectively than government bureaucrats.  Keep an eye on how things start shaping up with the new administration in Washington.  Experienced business leaders will be moving into senior roles.   And that means that innovative options in logistics markets might be coming from Washington for a change, and regulatory overkill that disrupts markets – like taxi medallions – will be on the chopping block.

Hedge your bets and watch for opportunity.

By Steve Geary | 01/08/2017 | 5:40 AM

Adapt, improvise, and overcome.

It has been interesting political theater, watching president elect Donald Trump at work during the run-up to taking office.  Is he a bull in the china shop, a fox in the hen house, or a creative opportunist trying to create negotiating space for innovation and transformation?

With the Department of Defense, he has taken shots at a Boeing development contract for preliminary designs on a preplacement for Air Force One.  Just after stirring things up over Air Force One, he lit a match under the Joint Strike Fighter (JSF) program at Lockheed Martin by asking Boeing to provide pricing for an updated F/A-18 as an alternative to the JSF.

Mr. Trump isn’t just taking aim at defense.  At various times he has threatened to eliminate entire federal cabinet level organizations, including both the Department of Education and the Environmental Protection Agency.  The New York Times published a nifty list of targets in Mr. Trump’s sight picture.

Negotiators love to introduce uncertainty.  Entrepreneurs try to leverage it.  Mr. Trump is both and he is doing both in ways we’ve never seen in our Government before.

Logisticians make a living understanding, managing and eliminating uncertainty.  From trade to borders to tariffs to defense to international trade agreements, Mr. Trump – the negotiator and the entrepreneur – is already bringing a truckload of uncertainty into our world.  From his perspective, it is the right thing to do but it looks very different from where we sit.

Much like a logistician introducing disruptive technology, Mr. Trump’s challenges to the status quo could be leveraged to advantage.

It’s time to hedge our bets.  Get nimble if you’re not already.  Re-establish parallel capability options in the United States, if you shipped it overseas.  If you have remained firmly entrenched in the US, relying on exports to reach overseas markets, it might be time to think about connecting with some partners offshore and establishing a ground game.

It looks like we’re in for an interesting four years.  Are you ready to improvise, adapt, and overcome?

Reading the tea leaves: What does the Trump presidency mean for logisticians?

By Steve Geary | 12/24/2016 | 7:55 AM

There are some very serious rumblings taking place at the federal level, in the wake of the election of Donald Trump, that should give us all pause. From what the President-elect is doing to the people he is nominating, we all need to figure out the implications.

As a logistician, there is reason to be optimistic about where the federal government is going.  We hear that there will be less regulation. We know there will be experienced business people—not bureaucrats and politicians—at the helm. It is reasonable to say that the federal government will have leadership that understands—I mean really understands—global business.

Just look no further than the nominee for Secretary of State. Rex Tillerson, the CEO of Exxon Mobil, knows a thing or two about global trade. Exxon Mobil is, after all, number 9 on the Forbes Global 2000 list. Whether you like him or not, and whether or not you like what what Exxon does, there is no doubt that the man understands trade and the players in the global markets.

Global trade is a critical engine for driving business and logistics, and it would appear that Rex Tillerson is a friend of global trade.

Alas, there is also reason for logisticians to be worried. We’ve already heard saber rattling over tariffs and the erection of trade barriers, coming from the President-elect. The EU is smoldering as Brexit proceeds, and the President-elect has made some troubling speeches. And there is always the possibility that aggressive immigration enforcement can spill over into trade.

If things get hot with China, will it impact trade?  And if it impacts trade, how will that impact logistics as an industry vertical?  What will Long Beach look like if trade with China dries up?  Given the President-elect’s engagement with Taiwan, we can surely see some fireworks as a possibility.

Officially, China has said that they are “deeply concerned.”  And subsequently, China dropped arms on islands—whose ownership is in dispute—and dared the world to do something. To add insult to injury, China then seized an underwater drone in international waters being operated by the U.S. Navy.

That’s the sort of behavior on the high seas that brought us the first international landing by the Marines a couple of hundred years ago in Tripoli. And we have a nominee as Secretary of Defense who is a Marine. General Mattis once said, "Be polite, be professional, but have a plan to kill everybody you meet." 

And this no-holds-barred approach fits well with the President-elect’s approach. A popular Mattis quote, dating from early in Operation Iraqi Freedom, said during a meeting with Sheiks as General Mattis tried to stabilize the country, “I come in peace. I didn’t bring artillery. But I’m pleading with you, with tears in my eyes: If you f*!% with me, I’ll kill you all.”

Put it all together, and logisticians find themselves entering uncertain times. I learned a long time ago to both fear and embrace uncertainty. Limit downside risk, and look to find opportunity in turmoil.

As we all reflect on where the federal government may be heading, there is wisdom to be found by logisticians in nursery rhymes.

"Jack be nimble,

Jack be quick,

Jack jump over

The candlestick."

There are storms on the horizon, and logisticians may have to rethink some things to be ready if a storm hits. Across the spectrum of the Federal Government, we may be in for a tumultuous four years.

The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.

About Steve Geary

Steve Geary

Steve Geary is an adjunct faculty member at the University of Tennessee's College of Business Administration, and is on the faculty at The Gordon Institute at Tufts University, where he teaches supply chain management. He is the President of the Supply Chain Visions family of companies, and Chief Operating Officer at ROSE Solutions, consultancies that work across the government sector. Steve is a contributing editor at DC Velocity, and editor-at-large for CSCMP's Supply Chain Quarterly. He is listed in Who's Who in America, Who's Who in the World, Who's Who in Science and Engineering, and Who's Who in Executives and Professionals. In November of 2007, Steve was recognized for "Selfless Service to Our Nation and the People of Iraq" by the Deputy Secretary of Defense.


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