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Empty Pockets

By Art van Bodegraven | 06/09/2017 | 6:25 AM

The demise of Hanjin Shipping is instructive at many levels for supply chain professionals. Richard Sharpe has commented extensively; I will add a little twist of lemon to the Ketel One.

Hanjin was a player, perhaps not dominant, but top tier among trans-oceanic cargo shippers, with an "A" list of clients/customers. There may have been small red flags, but utter collapse was a taser to the heart of supply chains with Asian components destined for Western consumption by both businesses and end-user consumers.

With the unannounced stoppage of ships loaded with product for US destinations, items of varying value and physical attributes were left bobbing in the otherwise tranquil waters of the Pacific just off the West Coast. Stuff was out there, but no one seemed to know where, and what might become of it. This tends to annoy the Samsungs, LGs, Apples, and Hondas of the planet, as well as cost them a fortune.

So, physical supply chains were immediately in disarray, visibiity meant low to no fog in the area, and customer expectations were in a place where the sun don't shine. And, supply chain executives were sweating through their Duluth Trading small clothes.

Deservedly. And, one wonders who didn't know what—and why not. Did everyone think that such a substantial link in major league supply chains was either in good financial shape, or could rely on its deep pockets in the event of challenges? Come to find out that the deep pockets were empty, or that there were no pockets to beginn with.

Whatever happened to due diligence? Are otherwise astute leaders making seat of the pants last year's reputation decisions when performance and profitability are on the line?

None of us, nor our enterprises, can afford the risk of doing business this way.

It's like approaching a rail crossing: stop,look, and listen. Or start looking for a job that is less demanding of good sense and attention to detail.

In the meantime, don't tase me, bro.



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About Art van Bodegraven

Art van Bodegraven

Art van Bodegraven (1939 - 2017) was Managing Principal of the van Bodegraven Associates consultancy and Founding Principal of Discovery Executive Services, which develops and delivers supply chain educational programs. He was formerly Chair of the Supply Chain Group AG, Partner at The Progress Group LLC, Development Executive at CSCMP, Practice Leader with S4 Consulting, and a Managing Director in Coopers & Lybrand's consulting practice. Concentrating in supply chain management and logistics for over 20 years in his 50+ year business career, he has led ground-breaking strategic, operational, and educational projects for leading US and global clients. Art was principal co-author of DC Velocity's Basic Training monthly column for a decade, and was the principal co-author, with Ken Ackerman, of Fundamentals of Supply Chain Management, the definitive primer in the field. His popular blog, The Art of Art, has been a staple of DC Velocity's web site since its inception.


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