The Supply Chain Buzz is Supply Chain Now’s regular Monday livestream, held at 12n ET each week. This show focuses on some of the leading stories from global supply chain and global business, always with special guests – the most important of which is the live audience!

This week’s edition of The Buzz featured hosts Scott Luton and Constantine Limberakis, along with special guests from Boston Consulting Group: Managing Directors & Senior Partners Laura Juliano and Dustin Burke.

In this livestream, created in collaboration with a live Supply Chain Now audience, Scott, Constantine, Laura, and Dustin discussed:

• The continuation of the automotive labor strikes and their impact on the economy and industry

• The impact of inflation on global supply chains and the potential for automation and digitization to reduce costs

• The ever-changing supply chain landscape and how to navigate shifts in labor costs and manufacturing locations

• The unpredictable six months ahead: Political affairs, COVID outbreaks, and the constant challenges of supply chain management

Intro/Outro (00:03):

Welcome to Supply Chain. Now the voice of global supply chain Supply chain now focuses on the best in the business for our worldwide audience, the people, the technologies, the best practices, and today’s critical issues, the challenges and opportunities. Stay tuned to hear from Those Making Global Business Happen right here on supply chain now.

Scott Luton (00:32):

Hey, hey. Good morning, good afternoon, good evening, wherever you are, Scott Luton and Constantine Limberakis with you here on Supply Chain. Now welcome to today’s live stream, Dino. How you doing today?

Constantine Limberakis (00:43):

Good morning, Mr. Luton. How are you?

Scott Luton (00:45):

I am doing wonderful. Wasn’t the best sports weekend, but hey, life short. I’m okay now. I know that your Chicago Bears we’re, we’re, we’re working on the turnaround playing there, is that right? Working

Constantine Limberakis (00:56):

On, yeah, working on the turnaround as we’re building a new stadium, which is gonna be imminently close to my house, but we’ll see in the next 10 years what that <laugh> looks like

Scott Luton (01:05):

Long term. Okay.

Constantine Limberakis (01:07):

Alright. Long

Scott Luton (01:08):

Guys. Well, hey folks. Today, as you know, this is Supply Chain Buzz live show that comes at you every Monday at 12 noon Eastern time. As always, Dino who’s sitting in Greg White, is on assignment. He’s probably in the plane, in the air somewhere as he heads to a commitment out in the marketplace. So we’ve got the one and only Constantine Limbus with you and me here today. So we’re gonna be talking about Dino, a variety of news and developments across we global business. And we’ve got a couple of great guest speakers as we’ve got, uh, Laura and Dustin with Boston Consulting Group joining us here about 12:25 PM Eastern Time. Finally, Hey, Dino, if folks are listening to the podcast replay, which we usually drop this on Friday mornings, they should consider joining us and give us their take live. Is that right?

Constantine Limberakis (01:54):

Absolutely. Yeah, they should. It’s, uh, it’s always a great way to share your thoughts and conversation.

Scott Luton (01:59):

So, Constantine, you know, one of the things we’re most passionate about here is sharing resources. We’ve got some great perspective in just a moment joining us that, that that’ll be, uh, offering up some real actionable insights for supply chain pros around the globe. Mm-hmm. <affirmative>, but I wanna share Constantine, we had a wonderful edition of with that said, go out Sunday morning. I don’t know if you got a chance to read that, but Constantine, it was very practical. Yes, it was around lean thinking, kind of what it means. It shared some fundamentals stuff folks could put into action right away, right.

Constantine Limberakis (02:32):

You know, the thing I liked the most was the five Ss methodology, which is the way I try to work on my desk. Sort, set, shine, standardize, sustain that. That’s like perfect. That, that, that, that’s the mold. I think that’s a fantastic way to start your day, <laugh>.

Scott Luton (02:49):

I appreciate that. And you know, what Dino is sharing is one of three tips or tools or lean approaches we put in the newsletter. My favorite Dino was the immense value. Once an an individual or a team member or a whole team really understands what waste is in all its different forms. I mean, it, it’s life changing. And that might sound dramatic, but it’s not, it’s real. So y’all check that out. We’ve got the link to, uh, with that said in the comments. And then also, hey, join us tomorrow as we, we’ve got a great webinar conversation teed up with our friends at Supply Pike. Three proven strategies to level up your business with Walmart 12 noon tomorrow. Now, Dina, as we’ve been talking about, if you can do business successfully with Walmart, you can probably do business successfully with a lot of folks. Would you agree?

Constantine Limberakis (03:37):

Absolutely. Top supply chain, you can’t beat that one.

Scott Luton (03:41):

Check out. With that said, and then of course, check out tomorrow’s live webinar as well. All right, man, we got a lot to get into here today, Dino, what do you think is probably the number one topic dominating a lot of industry minds right now?

Constantine Limberakis (04:00):

One word strike. Yes, strike.

Scott Luton (04:03):

And unfortunately it is ongoing, right? No, no resolution yet, but there’s a little bit of good news and we’re gonna get into that too. So let’s update everybody on what’s going on with automotive strike. So the United Auto Workers labor strike expanded last week as workers from 38 automotive parts distribution centers across 20 states joined in the effort. Now with that, you’ve got about 13% of U A W’s members participating in the strike. The DC workers impacted General Motors and STIs,

Constantine Limberakis (04:36):

STIs, St. STIs, we’ll go with that.

Scott Luton (04:38):

STIs. Okay, as the u a W intentionally did not target forward because they’ve said negotiations have made progress with that automaker. Now, suppliers to the big three automotive companies are starting to weigh in from our forensic supply chain dive automotive supplier, Borg Warner stated in a recent filing that the company only expects a relatively modest quote unquote impact from the labor strikes at this time. But the company added, if the strikes going for several more weeks or if they expand, which they did, of course on Friday, then the impact will be much, much larger. Now, Constantine, the U a w is pushing for more pay and benefits like most folks know. But one important thing that other folks may not know is that the labor union is going after the ability to represent workers at 10 electric vehicle battery factories across the country, which will be more and more important as consumer and industry shifts continue. So Dino, your thoughts here on the current automotive strike situation?

Constantine Limberakis (05:37):

Well, I think they’re being a little bit positive here at Borg Warner. ’cause one of the things that they mentioned in the article is that the battery systems is becoming a much bigger part of their business over time, right? And so that’s one of the major contentions of this, of the strike, right? Where the cost, you know, there’s less labor involved with these EV vehicles. And so as these things are shifting, this is reminiscent of all these other changes that we see in supply chains when you’re, when you’re going from an old technology to new technology, and how are you changing the way you’re manufacturing? And this is gonna be a real pivotal decision as to how this thing works itself out because it could be a permanence in the way people do manufacturing the impact of U A w, what their significance is. There’s a lot riding here politically and economically,

Scott Luton (06:29):

You know, excellent point. And it’s historical in a number of different ways. I, I was reading earlier today, Dino, the president, is, I think for the first time we’re gonna have a sitting president visit the strikes, the picket lines. And you know, clearly they’re making progress the u a W and Ford. But folks are saying that the GM solanis, they are still miles and miles apart with what, uh, the two sides are, are negotiating through. So Dino, let’s break out your crystal ball. All right? Now, if you’re, if it’s like mine, mine’s been broken for years now, right? And I haven’t been able to return it, I don’t have the freedom to repair it. If you had just to weigh in, when do you think the strike will be resolved? Do you think, you know, as BorgWarner was talking about, if it goes on weeks massive disruption, or do you think perhaps we have a big breakthrough this week or next week?

Constantine Limberakis (07:19):

I think the big three will probably negotiate something in the short term. And in the background we’re gonna see these long-term shifts. It’s because companies like Tesla and there’s others rivian that are emerging, they don’t have to worry about this, right? So this is kind of a legacy approach to what was back in the day when, when automakers came into play and they had a much bigger role and the impact of, of unions, which we’ve seen dramatically has changed, right? There’s some new kids on the block that are saying, we do it differently. Now, they also have said that Tesla, that if they did, uh, I think it was the GM C E O that was on the C B S morning news said that if we did negotiate and we gave them what they wanted, they’d be being paid twice as much as what Tesla employees are getting paid. Mm-hmm. So what does that tell you? I mean, is that a permanence to the way automakers are gonna have to go if they’re gonna stick to ev? And, and so this is again, like what I was trying to say before, if if they’re all going towards EV and they all wanna make that as part of the wider sustainability and green efforts that we’re talking about, well then the market shift here and the structure that exists, there’s something that’s gotta give

Scott Luton (08:38):

Excellent point.

Constantine Limberakis (08:38):

You know, and that, and that’s unfortunate, right? Because that’s people’s jobs and that’s their living. But what can you do?

Scott Luton (08:45):

Uh, a ton at stake to your point, and I’ll go back here in Georgia where I’m based as we mentioned, but you know, those EV battery there, there’s been, uh, there’s been one rivian plant plant that’s supposed to, you know, create about 6,000 jobs here in Georgia. And there’s been two other, if not three other really big EV plants announced like mega sites that’s gonna create thousands of jobs. So to your point, you know, a lot of these EV plants are joint projects between Korean companies and the big automakers. And so naturally, if the u a W is able to get one of their demands, that opens up, you know, brand new chapter for labor unions in that segment, that to your point, has been largely, you know, they haven’t been a part of. So we’ll see. We’re gonna keep our finger on the pulse and continue to update as things develop. Alright, really quick, moving along. Big thanks to Catherine, Amanda behind the scenes helping to make production happen. Great to see you Catherine. Okay, so Constantine, are you ready to move along? We, I’m

Constantine Limberakis (09:42):

Ready. I’m ready.

Scott Luton (09:43):

<laugh>. Okay man, I got something. You got a frog in your throat my friend. You need more? You need that seventh cup of coffee, something <laugh>. So in our second story I wanna talk about Amazon and an interesting new competitive twist as reported by our friends at the Wall Street Journal. Now the big A is still figuring out a strategy to rebuff new growing competitors in the e-commerce space. So Shine and Temu are two companies that specialize in offering customers great deals if they’re willing to wait for the products. That’s right. It’s 2005 again. ’cause as their customers are good with waiting a week or two for their orders to arrive. So Americans, clearly, Dino, it’s resonating ’cause uh, Americans are more than willing to give Sean and Timo a shot as their website traffic shows a massive increase of visitors. In fact, US consumer visits to Temu grew tenfold from September, 2022 to March, 2023.

Scott Luton (10:43):

But as we know, the big A is still the big a, Amazon is still Amazon and industry analysts say that it’s a safe bet that the retail giant will still maintain it’s close to a 40% stranglehold on the e-commerce market through at least 2024. But you know, Dino, Amazon is not taking that for granted. I’m sure they’re losing some sleep, a little sleep at night because you know, here in this story it’s Sean and tmu, but everyone is competing to some degree with Amazon. Your thoughts on American’s willingness to wait with these other two competitors? Uh,

Constantine Limberakis (11:17):

Well I think it’s again, the supply and demand here of what I’m looking to buy on these sites. I’ll confess, I went on to these sites for the first time o over the weekend and I got a very much kind of shop feel like discount shopping, get you this coupon. It’s a very different experience and purpose than say what people are gonna go to Amazon for. And I think then you’re dealing with this trade off of, yeah, I’m willing to wait because like it’s what they’re saying in the article because it’s cheaper and okay, maybe I’ll get this, but if you’re dealing with, you know, delivery, knowing you’re gonna get it on time, all the options that I have, all the services that Amazon provides behind the scenes, that’s why they’re probably not nervous. But you’re gonna keep seeing this pop up and you know, we’ll see what happens here. But I use my wife as a guidepost. I said, Han have you, have you gone to these sites? She said, I, she had never heard of ’em. So I don’t know. I mean, maybe now over Christmas time as it’s coming, maybe this will be a big spike. I don’t know. Maybe we’ll

Scott Luton (12:20):

See. I’m gonna place an order with one of these sites this week. ’cause to your point, from what I gather from this article and some others, other takes is that the service levels, you know, you, you shouldn’t expect Amazon service and visibility into where things are. And of course, as we talked about, it’s not next day or next two days that Constantine is something that to me is a bit refreshing. You know, I like the fact ’cause it kind of runs counter to where we are as a society. Mm-hmm. <affirmative> with folks, okay with not getting that bag of socks of seven pairs of socks waiting a week or two, rather than demanding to get ’em the next day. That takes some of the pressure off global supply chains. I think that’s a great thing.

Constantine Limberakis (13:01):

Yeah. Well, and again, it de it’s I guess part of Amazon’s strategies to own it from, from, you know, from shipment to delivery and you know, I have a Amazon logistics facility very close to my house. I’m getting used to same day delivery. I mean, that’s just insane, right? Yeah. Within hours of ordering something. So again, it goes back to the tastes and preferences and then it goes to, okay, what am I willing to wait for and what am I not willing to wait for? Hmm. And, you know, we’ll see, we’ll see how this unfolds. But I think they’re just, you know, they’re just trying to, to make some noise here. And, and, and obviously there’s some cool things that they’re offering that people are paying attention to

Scott Luton (13:39):

And the driving revenues, they’re creating a customer base. I love it. I

Constantine Limberakis (13:42):

Think the other thing we’re forgetting here too Yes. And we wanna make sure that we throw that in there, is there’s also the issue of question over quality, right? And then also the supply chain and some of the stuff that’s being talked about now with the Uyghur law and, and some of those concerns there too, into terms of transparency. Yeah. So, you know, the whole thing with Alibaba, like, you don’t even hear about that anymore. So these popups of, since these are very focused in China, that’s gonna weigh heavily too. And what the competition is and what third party vendors can do to sell on these sites. You know? ’cause that’s, that’s a whole other part of the business, like 40% of Amazon’s business. So, yeah, I don’t know. I mean, it it, it goes down to what your preference is and what you, how you wanna buy online.

Scott Luton (14:25):

Yep. Agreed. Agreed. As always does. And we’re also going to be talking a lot more about inflation ’cause costs are up everywhere. You know, Constantine, before we bring on our two, uh, outstanding featured guests here in, in a couple minutes, I’ve already put it out there. I’m a big Costco fan, right? I’m, I really enjoy the shopping experience being a Costco member. Right? And we were there this weekend and goodness gracious, lots of deals. But what is not up Dino except my holiday budget. My budget is shrinking. Can you relate to this?

Constantine Limberakis (14:56):

Definitely. I can relate to it. <laugh>, <laugh>.

Scott Luton (15:00):

So, but I mean every from gas to energy, you know, after about 12 months of us getting a handle on just the rate of inflation, right? In July and August, that core metric rose two months in a row. So I hope we we’ll see what the September numbers bring. But Dina probably more of the same. Is that what you’re thinking? Mm-hmm.

Constantine Limberakis (15:22):

<affirmative>. Mm-hmm. <affirmative>. And again, I think, you know, you got the Fed being a little weary and they’re talking about, they held off on raising rates, but then, you know, there’s that, there’s this always this thing in the future. People are just kind of not quite sure. And I know we’re gonna talk about this in the next segment, but you know, they’re saying inflation’s kind of come off. But you know, with this expenditures that are expected in the shopping season, I mean, that is a huge time when, when a lot of money’s being spent. So that could, that could also create an increase. Who knows? That’s

Scott Luton (15:52):

Right. And one last note, you’re talking about the shopping season, you know, peak and we were talking about Amazon earlier. I was reading Constantine, that Amazon, despite what you hear, they’re expecting a big season. If you look at their seasonal hiring, they’re well over last year’s in terms of the seasonal employees that they’re bringing in to help with the massive volume. So that’s, that’s a good, that’s good news, don’t you think? Except for the, uh, <laugh> those that that have to manage that budget. The, the holiday budget, huh? I feel a lot of pain there, Dino.

Constantine Limberakis (16:21):

Absolutely. It’s always painful around that time. ’cause then there’s always more on the, on the shopping list now. But when you got, when you got kids that are in college, that’s a different type of ask <laugh> the shopping list, uh, you know, kids that are younger like yours. So again, it’s, it’s

Scott Luton (16:36):

Interesting. I’m not wishing time away. In fact, I’m praying it goes slower and slower, uh, for a variety of reasons. All right, well I’m excited Constantine, that to what really have enjoyed our, our pre-show conversations with our guests here. So, uh, if you’re good with it, anything you wanna tackle before we bring on Laura and Dustin?

Constantine Limberakis (16:54):

I’m looking forward to hear what these pundits have to say. Boston Consulting.

Scott Luton (16:58):

I am too. The mountain movers that they are. So welcome in. Laura Giuliano, managing director and senior partner with Boston Consulting Group and her colleague Dustin Burke, managing director and senior partner also with B C G. Hey. Hey Laura, how you doing? Excellent. How are you Scott?

Scott Luton (17:16):

I am doing wonderful. And Dustin, welcome in. How you doing? I’m doing well as well. Hi Scott. Great to see y’all. Really have enjoyed our pre-show conversations and we got a lot to get to here today. But Dino, we got a fun warmup question we’re gonna have a little bit of fun with as we are doing our homework, Laura, gathering some intel on both you and Dustin. So this is where we’re gonna start. So over the weekend, Constantine, Laura and Dustin, I was watching that 1990 popular movie, days of Thunder, right? Tom Cruise plays cold trickle, if y’all remember that right? He battles it out on the NASCAR circuit. And so with that as a backdrop, it got me thinking the panel here, do we have a need for speed? I’m kind of in the middle, right? Not too fast. Not too slow, right? I ride a few roller coasters. I liked him better as a kid than I do as an adult. But I wanna pose this question. Laura, I’m gonna start with you ’cause we got a little homework. We had a little insiders intel inside baseball with Laura. So do you have a need for speed or do you avoid any thorough rods in life in the fast lane in general, Laura?

Laura Juliano (18:18):

Well, I’ll tell you in my younger years, a hundred percent needed speed. I think as I’ve gotten older, uh, I need to slow down a little bit. I can hear my bones get outta bed every morning, <laugh>. And so it’s gotta be a little more measured in my movements. But love everything having to do with professional racing. I’m a bit more of a formula person than, than nascar. Had a great time watching the Grand Tomo movie this weekend with my kids when I, in my younger days. Yeah, I actually had a wonderful opportunity to do some performance driving mostly with Audi Club back before I had kids and learned that I was not immortal <laugh>, but definitely enjoyed racing some of the best road tracks in the us learning the line, understanding contact patches around the turns. And I use a lot of those metaphors in my life today, even though I haven’t, haven’t been at high speed behind the wheel in a few years at this point.

Scott Luton (19:10):

Man, Laura. Alright, so we’re gonna have to have you back, we gotta dive into that chapter and get all the, uh, all the stories you can’t share here today. That is really fascinating, Dino. We’re gonna need tips from Laura in terms of how to bow and Luke duke it around the interstates around Atlanta. How’s that sound? Sounds

Constantine Limberakis (19:26):

Great. <laugh>.

Scott Luton (19:28):

All right, so Dustin, that’s gonna be tough to talk. Yeah. And I only can imagine some of the conversations y’all have, but what’s your take, Dustin? Uh, your need for speed? How are you geared?

Dustin Burke (19:36):

My need for speed’s pretty low. Like, probably like a lot of you, my week moves pretty fast, going to different towns, hopping from meeting to meeting. Yeah. You know, focus, making supply chains move fast, not make me, not making me move fast. Maybe <laugh>, but even on weekends, hopping between the soccer game that kid’s baseball game, I’m moving, uh, fast enough for my taste most of the time. So when I do need to pick, I can slow it down and just,

Scott Luton (20:03):

Oh, Dustin, I love that. I love that. ’cause as much fun as it is at times to go fast, I’m with you, man. If we can just slow it down. And those leisurely paces, whether you’re driving or it’s working or even at, at the amusement park, those are good days too, right? Dusts.

Dustin Burke (20:19):

Exactly.

Scott Luton (20:20):

All right, Dino, I’m, I’m kind of curious here. So we, we’ve got a, a tale of two cities between Laura and Dustin, right? So Dino be the, the tie breaker. How are you geared?

Constantine Limberakis (20:29):

Depends on the car I’m driving. <laugh>. Okay.

Scott Luton (20:32):

All right.

Constantine Limberakis (20:33):

Well, if I’m in, if I’m in like the Audi Q seven that we have, you know, eh, I’ll take it easy. Every once in a while you’ll punch it, but then I have this little golf R that I love to drive that, that gets me into trouble every once in a while.

Scott Luton (20:46):

So

Constantine Limberakis (20:47):

One car. So it depends on what you’re driving and I bet you Laura would agree not

Laura Juliano (20:52):

That that’s right. I’m clinging to my eight year old G T I because I know how to throw it into the turns at this point, it’s not going anywhere anytime soon.

Scott Luton (21:00):

<laugh>. All right, so Laura, we’re gonna have to get some, some pictures and some videos of, that’s, that’s, that sounds cool. I’ll just add one last thing here. So as I mentioned, uh, I, I, I have found out, you know, I went like 20 years without going to an amusement park. And then I went a few years back and then I realized just how low my appetite now is for like roller coasters and stuff. But I’ll tell you all this, it’s not so much now because of construction, all this stuff, but man driving in Atlanta on like a Saturday morning when there’s not as much traffic if you’re in the right car, kinda like what Laura and Constantine’s talking about. It really can be a lot of fun. Always go to speed limit though, as I do. All right. So Constantine, Laura, and Dustin, we got a lot to get to here today, but I wanna start with this as we move along from the need for speed to the mountains that y’all and your teams are both moving out in global supply chain. So let’s level set for a bit, Laura, start with you again. Tell us a little bit of information about, you know, your professional background and what y’all do at Boston Consulting Group.

Laura Juliano (21:56):

Yep, absolutely. So I’ve had the pleasure of working at B C G for the better part of two decades at this point. And the whole time I’ve always loved and been focused on industrial industry, so automotive, aerospace, agriculture, machinery, and really getting into the inner workings and operations. Everything from how you procure the goods design, buy everything through the supply chain, four walls, manufacturing, distribution, center, aftermarket, sales and service. And so I was lucky enough to get to take on a role, uh, earlier this year as head of our operations practice for North America. It’s a position that gets to touch every element of that chain and really dive deep into where the hot topics sit. And so I serve clients globally, really cross industry, but but most heavily in those industrial spots. And I have the pleasure of partnering with some wonderful colleagues who are kind of the yin to my yang. As you’ve already heard a little bit with Dustin, I assume you’re gonna throw it to him to introduce himself. You’re here, we compliment each other, I think, well on these areas.

Scott Luton (23:00):

I love it. I can, I can definitely see that. All right, so Dustin, the ying to, to Laura’s yang. Tell us a little more about you and what you do there at B C G.

Dustin Burke (23:08):

So I’ve been at B C G about the same amount of time that Laura has. My focus is similar but a little bit different. I lead our supply chain topic globally, including leading a team we call supply chain ai, which is a group of consultants, data scientists, designers, to develop digital supply chain solutions for our clients. My passion and a lot of my work is in all things distribution and logistics. So network optimization, routing, whether it’s consumer goods, industrials, distributors. And I also spend some time working with three pls and carriers across different modes. So pretty much it comes to things getting distributed and moved. That’s where I like to spend a lot of my time.

Scott Luton (23:48):

Outstanding. Excellent point. And you know, speaking of, uh, and we touched on that with that said newsletter on the front end, Laura and Dustin, one of the main points that we made in that newsletter is, you know, the overwhelming majority of team members, you know, of any organization want to be successful, want to have a good day at work. And really as leaders, the onus is on us to really enable and empower them. Dina, to your point, leveraging in part technology and many other things. But we’ve got some stuff to get into with Laura and Dustin. This is where I wanna start. Some may claim, Dustin, that supply chains are arguably back to normal. Yeah. However, we’re certainly all still dealing with inflation as Constantine and I were talking about earlier. In fact, as I mentioned here in the US the annual inflation rate rose again in August for the second straight month. So interesting read here via the Economist. So tell us more, Dustin, give us your take here.

Dustin Burke (24:42):

I think this is a, an article we’re checking out partly because it’s short. That’s good. And also there’s a picture that helps. Uh, but what I like about it is it’s taking a look at one of several supply chain indices that were put together over the past couple of years that tried to measure how well our supply chains are functioning, whether they’re in crisis. And it basically shows how much of that stress was due to the various things that we all saw, but often kind of argued about was it demand, was it about stockpiling? Was it because we had a shortage of parts and components, or there weren’t enough people coming to work, or was the transportation costs. Turns out the supply chain stresses for the past two years was all of the above. You can kind of look at the data and see when over time each of these things really played out.

Dustin Burke (25:29):

Mm-hmm. <affirmative>. The other part of this that I think is important though, is it shows that stress coming way down in the past few months down to, you know, what is normal. So what we would’ve seen before the covid induced supply chain crises, the implications of that to me are that to the extent we do still see pretty high inflation, and we do, although lower than we did, you know, say six months ago, it’s less and less less about supply chain. There are other factors at play, or it’s some expectations on leading to passing through prices in other spaces. What’s also, I think, really important is it doesn’t mean that the supply chain stresses are over or that we don’t need to be paying attention to supply chain resilience. I think it means a couple of things. Everyone’s mileage will vary depending on where in the world you’re operating.

Dustin Burke (26:18):

What you make somebody somewhere in the world every day is having a supply chain crisis. It’s just sometimes in one industry or in one region. We just saw it all at once for the past few years. Hmm. The other part is it shows demand going way down. So, but if you are now sitting in a pile of inventory or your three pl and rates are closer to the floor than there to the roof, that is also a crisis. So I think that just means there are different versions of challenges and stresses right now in supply chain that some of us need to need to pay attention to. And then maybe finally the upshot of that is it’s now a pretty good time, I think for many of us to try to recoup some of that lost margin that we saw through incessant inflation and really pay attention again to cost now that we’re not putting out supply chain buyers.

Scott Luton (27:06):

Excellent point. Several points there. Dustin, before I move over to Lauren and get her comments based on what you shared, I would just point out I am never confused as a math expert. However, there’s something wrong with that calculator in this shot. I don’t think <laugh>, I don’t think we’re supposed to see words versus numbers. So Laura, give us your take on why inflation and and crises that still are all around global supply chain depending on where you are.

Laura Juliano (27:29):

I think it all goes back to the point that Dustin made at the very end. The fact that with all of the volatility and uncertainty that we lived with for the past few years, a lot of bad habits were created through our supply chains globally in the markets individually with the way we interact with and handle the workers of our organizations. And a lot of those broken elements mean that every individual vulnerability becomes magnified in the supply chain world. And as Dustin mentioned, now is the time to really hit the reset button, take a pause, recognize that while there still is uncertainty and unpredictability, we have a lot more certainty than we did a few years ago. And if we take a good hard look at how we manage our people, utilize their talents and structure, the efficiency and processes of organizations, we can rebuild into a place of, of more comfort and smoothness with the way that we operate

Scott Luton (28:28):

And performance and success. Right. Laura, I love that point. And Dean, I wanna come to you first, or there’s something I wanna definitely circle back on that, that Laura and Dustin kind of spoke to, but you know, your thoughts here.

Constantine Limberakis (28:38):

Yeah, I mean, one of the other things we need to keep in mind here is the shifts that are happening based, you know, for instance, with our conversation earlier with the u a w strike over time, how are these dynamics in this supply chain gonna change with the cost of, uh, labor in certain markets? Also with where those products and those materials are gonna be coming from, where manufacturing’s gonna be reshored. So it’s interesting to see where this kind of pressure’s kind of come down, but over the long haul, where, where is that gonna look? You know, what’s that gonna look like in the next couple years as some of these things continue shifting, particularly in the EV market or even more greener sustainable type markets where com companies are trying to head towards. So,

Scott Luton (29:21):

Hmm. Good stuff there. Dina. I wanna go back to what Laura, what you said there, a lot of bad habits have been created in the last few years, and I, I completely agree, a lot of workarounds, a lot of compromises just to get stuff out the door and and out to the customer. And kind of one of the things you’re implying there, those band-aids <laugh> is tough to build and optimize and run successful organizations and operations if you got a bunch of band-aids everywhere. But Laura, give me a chance, is that kind of the point you were making there? Any other thoughts you wanna share?

Laura Juliano (29:53):

That was definitely the main point. And I’ll give an example just to make it real. When we start to work with our clients, looking at procurement costs being high, so the input materials, direct procurement to whatever it is the manufacturer is making, when you start to look at the supply base, oftentimes these days there are way more suppliers than there were pre pandemic. Supply chain risk has increased the level of fidelity in the regular supplier checks and sourcing mechanisms have gone down. The average tenure of the supply chain organization, and particularly buyers and strategic category managers, is a much shorter tenure because there was so much turnover at the headcount level. All of these bandaids that have been put on stack up over time and create an organization that isn’t ready to adapt when the next problem hits, hasn’t seen the issues before. So it doesn’t know how to react, have only been at the negotiating table so many times with suppliers, and as a result, really your spend gets suboptimized and you end up costing more than it should tocar your product.

Scott Luton (30:59):

Laura, well said. And man, that was a truckload of brilliance. Uh, you just dropped there. We’re gonna get a certification after the end of today’s buzz episode. Uh, I love that. Just I’m gonna give you the final, we got one more really interesting read that we’re gonna get both of y’all’s take on, but Dustin, your final word here on inflation and the impact it’s having across global supply chain.

Dustin Burke (31:20):

Yeah, I mean, I think what we’re seeing now is that, you know, workers are facing inflation in terms of their own cost of living mean. Meanwhile, for manufacturers and those in distribution, they’re seeing cost inflation, which are the wages of those workers and how it all winds down. And when we don’t yet really know, but I think we know that it probably will subside and then those cost structures need to be addressed. And I think one of the things that’s going to be different now maybe than what we saw before, the upheaval over the past couple of years in terms of how that’s addressed, is a lot of those automation technologies, and it’s related to what, you know, alluded to in ed manufacturing, they’re much more sophisticated than they were before this crisis. And they have a pretty good r o i in a lot of instances. So I think, you know, we, we still see companies looking at really investing in automation and digitization even with and as the way to focus on producing their costs.

Scott Luton (32:14):

Well said Dustin. All right. So Dino, I think, at least for me, I think it’s safe to say that Laura and Dustin’s crystal ball is more effective than mine has been based on what they’ve already shared here. Dino, your last word before we move on to the next article.

Constantine Limberakis (32:28):

Well, I think what Laura was saying also reflects something you had said in the past on a previous podcast about the, the retiring and the, you know, the baby boomers. A lot of of this retiring going on. You got a whole influx of new workers that are coming in and now having to deal with the change, the rapid change that we’re replacing these people at speed and how are we gonna implement these technologies and the automation. And given the fact that a lot of that knowledge, that tribal knowledge, how are you building that into these processes? And

Scott Luton (33:01):

Well said, man, tribal knowledge is incredibly valuable and so many organizations are at risk right now and losing so much of it. All right, I’ll save that for another day. That’s a great call out. Dino, I wanna move into this next read. This is a really good one that Laura brought to us. Very practical read. I’m a big fan of practical reads and that’s exactly what this is. So Laura, all of this discussion I would argue really begs that question, how can we get our cake and eat it too? Cutting costs while improving supply chain performance. This article via Forbes has about 14 different old and new ideas to, to try. Laura, your thoughts Tell us more.

Laura Juliano (33:38):

Well, I don’t know if I love this article because it was just confirmation from Forbes business council members that what I believe is also what they believe is happening out in the market <laugh>. But a lot of similar themes to what we’ve been talking about here. I I think a few stuck out of the, the 14 or 15 suggestions in there, about half of them mentioned data analytics, looking at history and then utilizing technology to project and react going forward. And I think that’s such an important element, especially as quickly as technology is moving. The investment to put it in place is coming down as the benefit to do so is increasing. And so as you think about how do we actually cut costs but improve efficiency, utilization of mature, but also some emerging technologies or is one great way to do it? I think really good example of that is generative ai, which typically has a much lower investment profile to it and can reduce significant manual repetitive work that not only doesn’t add a ton of value, but actually is not enjoyable by the workers.

Laura Juliano (34:46):

Some of the other themes that really stuck out to me, number one, the first one on the list that I I’m very glad was first is around knowing your customer and and conducting what the executive called know your customer checks. Oftentimes a lot of the costly activities that a company is doing are not actually valuable to the customer. And so simply understanding and taking a good hard look at what does the customer value, where should I be spending that time and effort and eliminating the low value activities or a way to cut costs, but actually increase the level of customer satisfaction that exists. And then the third one that I’ll call out if there was one slight disappointment in, in the comments here, I think the one was the fact that the mention of the importance of the team only came out really once around asking your team members and your employees for ways to improve efficiency. And every time that Dustin and I and our colleagues enter onto a site with frontline workers, having those conversations is often the biggest unlock, I hate to say it, but Dustin and I don’t come up with the ideas <laugh>, we are there as the voice piece typically to either the data or the customer or the workers on the ground. And so oftentimes you can cut costs by asking the workers where the inefficiencies sit and you’re both increasing their satisfaction and getting to contribute to the organization as well as identifying those ways to improve efficiency.

Scott Luton (36:16):

So well said. And I love, man, two quick things and Dustin, I’m gonna come to you and get your take here. But that value to the customer as they define it is so important. It is so important ’cause we can fool ourselves. It’s kind of, you were implying there regularly and many organizations and many teams to many leaders do. And then secondly, yes, the frontline are brilliant individuals. There’s a reason why, you know, going to the gemba is such a huge opportunity you go to where that value is created. And oftentimes, Laura, to your point, they’re the experts and they have tons of ideas that can impact the business. So Dustin, your thoughts though, Dustin, we’re talking about a lot of these practical takes and this Forbes article Yeah. Here entitled How Leaders Can Cut Supply Chain Costs and Improve Performance. Your thoughts, Dustin? Yeah,

Dustin Burke (37:00):

I mean I think that’s absolutely right. Yeah. One of the other things I think that’s happening out there is that while a lot of companies are really focused on addressing their supply chain costs, those that have been reluctant or maybe haven’t moved as fast as others are a little concerned about how they would do it. Because a lot of those costs are people costs and supply chain, right? There are other things we spend money on, transportation, technology, packaging, that kind of thing. But there are also people costs and everybody has just worked so hard for the past few years to find and retain the right people. So rather what we, you know, talk to a lot of leaders about is how to get the most out of the people they do have and make them as effective as they can be by making that work really efficient, as Laura mentioned, which also helps to retain those people now so you can really train them, upskill them in performing at the highest level because we agree talent is still going to be hard to come by even if and when the economy softens.

Scott Luton (37:55):

Excellent point, Dustin. A lot of folks, man, talent’s been hard to come by in, in, in some roles and in some sectors for years now. Goodness gracious. And then of course, as we all know, that’s, that’s only added more momentum to that, the automation that y’all touched on that can really, really help streamline, and I’m a big believer in dealing, I’m coming to you next, but open doors of opportunities, especially for those team members that raise their hand and volunteer, are willing to learn and find new ways of adding value to an organization if that’s how you’re geared. This is a golden age for your career right now. Dina, your thoughts here on what we’re talking about costs, supply chain performance, these ideas what Laura and Dustin both have shared? Yeah, I mean

Constantine Limberakis (38:34):

It’s implied in the title that they’re focusing on costs and improving performance, but the one thing I found missing was also knowing your supplier and managing risk. It’s something that we talked a little bit about before. I think you intimated at that before Laura. Uh, which is becoming increasingly an area that a lot of companies are investing into supply chain, supply chain risk management as it relates to the cyber, as it relates to compliance, as it relates to all these other components as part of the supply chain in addition to some of these things. So that might be, uh, an another added thing that you’d layer on top of the traditional operational model of cost and and performance. Mm-hmm. So that, that would be my only comment.

Scott Luton (39:14):

Well said Dino, Laura and Dustin, I I wish we both had another hour with you. I know that y’all’s schedule does not allow that. I wanna just share a couple quick comments and folks, I bet Laura and Dustin, they strike me as a type I bet welcome a cup of coffee to, to talk shop after today’s Sure. Uh, conversation or to talk racing at LA if, if you do do happen to get a chance to any week <laugh> any day of the week. That’s right. Okay. I wanna make sure folks know how to connect with both of y’all. Laura and Dustin la let’s start with you. I know that I think we caught you as you’re traveling through Atlanta here today. I think officially again, the world’s busiest airport that kind of toggles back and forth with one or two other airports out there. But Laura, how can folks connect with you and your team at B C G?

Laura Juliano (39:57):

Definitely on LinkedIn is the, the easiest way. Follow me, connect. We’d love to keep up the conversation, so please reach out. And

Scott Luton (40:05):

Dustin, same thing for you. How can folks track you down if it’s not at a Bears game, perhaps think you’re a Bears fan, right? No, I

Dustin Burke (40:11):

Am, but I haven’t been at a game in a while because like I said, I’m spending my weekends at kids baseball games and soccer games, so I wouldn’t recommend coming to watch the ones that I’m at. So, um, I would find me on LinkedIn. So you’ll either see me probably at O’Hare at some point or at LinkedIn.

Scott Luton (40:25):

Awesome. Dino, before we bid ado to Dustin Lar your final comment based on what they brought here today to the supply chain buzz,

Constantine Limberakis (40:33):

Great articles, great discussion. I think I just wish we had more time to talk in more depth than each of these so <laugh> appreciate that the conversation, you

Scott Luton (40:42):

Know, even just like a buck doesn’t go as far as it used to, an hour does not go as, as far as it used to either it seems. But hey, big thanks to Laura and Dustin. Laura Giuliano, managing director and senior partner with Boston Consulting Group and your colleague Dustin Burke, also managing director and senior partner with B C G, Laura and Dustin. We look forward to talking with you again soon. Safe travels. Thank

Dustin Burke (41:05):

You.

Laura Juliano (41:06):

Thank you so much. Great being here. Alright

Scott Luton (41:09):

Man, I really enjoyed, you know, I had a hunch, Dino mm, you, we were able to connect with Laura and Dustin Preshow and I had a hunch that they were gonna back up that truckload of brilliance and, and pull the lever and dump it on our audience here. And really they both really brought it. So Dina, one of the key issues remain though we’re gonna have to still navigate, continue to navigate our way, both as practitioners and as consumers through this inflationary environment, right?

Constantine Limberakis (41:37):

Yeah. I mean that article with the, with the Economist is kind of leaving me hanging. ’cause I think there’s this, there’s this anticipation still out there in the economy. It’s like, why are these interest rates so high then if we’re still thinking there’s other dynamics here that are at play that I just don’t know if that article reflects that. And I’d like to get more insight there because you know, the, by the time you make a decision and react to something, you know something else is going on and you know, that’s just a snapshot in time. What is gonna be that next six months? Is it gonna be some other political affair? Is it gonna be another outbreak of covid? I mean, we don’t, we don’t know, right?

Scott Luton (42:14):

So, but you know what? We do know <laugh>, you know what we know, right? That there’s gonna be, it’s, it’s gonna be something. It’s continuously something. As Dustin and Laura pointed out, that’s the nature of supply chain management and supply chain leadership. That’s how it goes. I wanna add one more thing to your final thought. We’re, we’re gonna make sure we got a couple events we wanna make sure it’s on our global audience’s radar this week, live events. But this Forbes article, and I like how Laura put it. She didn’t say this exactly, but basically there’s no rocket science, there’s no, you know, new revelations in the Forbes piece, but good practical ideas. But I think the one out of the 14 or 15 that were there, the one that, and it starts with it, you know, conducting those, know your customer checks, one organization called it the K Y C, know your customer.

Scott Luton (42:57):

That is as basic as it comes. But it is a basic step that organizations and leaders and supply chain pros miss time and time again. And now Dino, the opportunity, we have to also touch on something they both mentioned now that the world thankfully has opened back up, is getting out, get into plants, get into those dcs, go out and meet that team, walk their operations and, and those conversations with the frontline and those conversations with your customers at all levels, man, that’s where outstanding opportunities for improvement, for expansion, for growth can come out of. And that’s, man, I love a good old plant tour. Maybe boring to some folks, but man, I think my counts, it’s over 300. I don’t know where the count is, but that’s one my favorite things to do. Do you know your thoughts before we share a couple of events? Well,

Constantine Limberakis (43:45):

It, it really ties back to that gemba concept that I’m glad that you guys presented in the, in the blog over the weekend. ’cause that, that, that holds so true. I mean, there’s so much you can learn from walking in someone else’s shoes. I guess that’s another way of describing it and understanding what’s happening at the plant level. What you won’t see, you know, just on a computer in the data or it may be hard to extract that and seeing what’s really going on and what do they really need. So,

Scott Luton (44:09):

Excellent point.

Constantine Limberakis (44:10):

It’s a great way to understand, uh, how, how do you know what you need to do next?

Scott Luton (44:14):

But if you’re gonna visit the frontline, be sure don’t disrupt it, right? That’s not the place to try, you know, interrupt operations and try new things. Observe, ask questions, absorb. I mean that’s, that’s, you know, save the rest for later. But that’s where it’s at. That’s, that’s certainly a big, big opportunity for more folks. Okay, so let’s do this. I wanna make sure folks, you know, again, resources just like Laura and Dustin dropped some perspective that folks need to know that are out there moving those mountains. We’ve got a couple other opportunities coming up starting Wednesday. We already touched on the webinar tomorrow, Wednesday. Get this Dino lessons learned from the Coca-Cola company on optimizing your tech stack. So join us 12 noon on Wednesday, September 27th. Hard to believe. We’re at the end of the month already. And then Dino, you and I are tackling this on Thursday at, at 10:30 AM eastern time from chaos to control, best in class supply chain visibility. So join us for that. And you know, one final word there, Dino visibility as we’ve talked about, is not enough. We gotta have solutions, we gotta have outcomes, right?

Constantine Limberakis (45:19):

That’s right. Absolutely, absolutely.

Scott Luton (45:22):

Turn to those trusted pros that can do just that. And my hunch is Laura and Dustin do that probably every day of the week is my hunch. Constantine, what you think. I wanted

Constantine Limberakis (45:32):

To hear a little bit more from Dustin on what he was talking about in that beginning, but maybe we can get them on a, on another one. We’ll talk more about some,

Scott Luton (45:39):

I bet we’ll have ’em back. I bet we’ll have ’em back. <laugh>, you know, uh, an hour again, an hour doesn’t stretch as far as it used to, I don’t think. But a lot of good stuff, Constantine. Always a pleasure. I’m looking forward to the rest of our live events this week. Of course. Big thanks to Dustin and Laura with the Boston Consulting Group. Folks, make sure you connect with them both follow them, connect with b c G, check out the resources and the articles. Big thanks to Amanda and Catherine making things happen. Constantine, always a pleasure. And I’m pulling, I know, I know. The turnaround plan for the Chicago Bears is coming. It’s coming. Have faith.

Constantine Limberakis (46:16):

All right, well, I’m just gonna hold my breath a little on that <laugh> and I’ll just hold my arsenal. Can, can win a game next week. ’cause I, we didn’t, we didn’t win against, uh, Tottenham in the

Scott Luton (46:24):

To, I know oh and three man, but hey, there, better days ahead. Yes. So Constantine, Lerock a k Dino, thanks for being here today. But that last little note, that’s where one ended. ’cause there is reason for optimism. And I think a big part of that for leaders out there, and we’re all leaders in different ways and form, is we gotta act on that onus, right? We gotta lean into real solutions, not just the latest and greatest technologies, but those real solutions that enable and empower our teams to have good days and to do great things for the organization. That folks, Dustin, Laura Bo touched on ideas from their expertise there. Constantine made a couple of things there. It’s, it’s all about taking action. No deeds, not words. And with that, thanks for being here today, Scott Luton and the whole team here at Supply Chain now challenges you to do good, to give forward and to be the change. And we’ll see next time, right back here and supply chain now. Thanks everybody.

Intro/Outro (47:19):

Thanks for being a part of our supply chain now, community. Check out all of our programming@supplychainnow.com and make sure you subscribe to Supply Chain now, anywhere you listen to podcasts. And follow us on Facebook, LinkedIn, Twitter, and Instagram. See you next time on Supply Chain. Now.