Henry is a Director in the Australian Operations Advisory Group and National Leader Supply Chain for KPMG Australia. Here he discusses how epidemics like the recent spread of coronavirus are causing organisations to rethink their shift to globalisation.
Henry brings more than 20 years’ experience in supply chain strategy, design and implementation, transformational change management, business planning and operations management.
He has worked with clients in Europe, South Africa, North America and Australia. Holding senior positions at Cisco and Rockwell Automation as well as consulted for many global organisations across retail, consumer goods, industrial, life sciences, health, telco and mining.
One area that Henry is particular interested in is the effect of the recent trend towards globalisation. “When globalisation became mainstream, it was all about cost, but nobody really understood the potential impact this would have on the supply chain,” he says.
This kind of impact can be seen with the current coronavirus crisis causing significant problems for huge global organisations such as Apple, Tesla and DHL. This week, it was reported that 94 per cent of the top 1000 Fortune companies are experiencing coronavirus supply chain disruptions.
The air and sea global freight industry are confirming that a “return to the norm” is months away, with some suggesting that it will be September or longer before a full return to productivity and sufficiency across the supply chain.
Some organisations are already reporting a loss in profits, with the world’s biggest container ship operator, Maersk, saying the impact from the coronavirus will send its company into an unexpected fourth-quarter loss.
“Moving your supply chain to some of these cheaper locations may present cost-savings initially, but if you look at total cost of ownership you could be looking at huge losses,” Henry says.
For Henry, it’s important to understand the implications and consider these when planning a global supply chain. “It might be a hybrid model, whereby you keep some of the more critical parts in your supply chain much closer to where the goods will be sold or used,” he says.
Henry relays some early advice he was given while studying supply chain and says that supply chain management is ultimately about two things. First it’s about reducing complexity, and secondly it’s about reducing uncertainty,” he says.
With these two principles in mind, Henry says we should question why we add complexity all the time. “if you are sourcing product from Vietnam for a Melbourne point of sale, you are adding complexity,” he says.
For Henry, much of the work he does is about reducing complexities across the supply chain. He sees developments in data and artificial intelligence as a way to help reduce complexities.
“If we can use these tools to predict that certain issues may arise, then it’s much easier to mitigate that risk when it happens,” he says.
Henry will be speaking on Wednesday 1 April at MEGATRANS. He will be discussing the global economy and the ripple effects on the supply chain as part of the internatial trade and shipping stream.
For more information and to book your ticket, visit: www.megatrans.com.au.