• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile

  • CORONAVIRUS
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Climate Change and Supply Chain Resiliency

Climate Change and Supply Chain Resiliency

March 8, 2016
SupplyChainBrain

Thirty years ago, a typhoon hitting China would have had little impact on world business. Today, such an event would seriously disrupt an almost countless number of global supply chains. In other words, climate change is a growing business risk not just because significant climate events have become somewhat more frequent, but because supply chains have elongated and become more global, putting a company’s supply chain in the path of more climate events. Plus, in many cases, supply chains have been managed to be so lean and efficient that they have also become brittle and vulnerable to disruptive events. They lack resiliency and create financial outcomes that could impact the business strategy.

We see climate change risk to supply chains developing along three trajectories. The first type of climate change effect is the very focused, catastrophic weather event: the hurricane, tsunami, flood, earthquake, etc. While the ability to attribute any one of these events directly to climate change is hotly debated, their aggregate number seems to be on the rise. And when they occur, they have a very sudden, very dramatic impact on supply chains that cross their path.

Second are broader, near-term climate change events, such as El Nino. Their effects are better understood and this can help companies plan. For example, in California, increased torrential downpours during El Nino years have historically caused severe flooding and mudslides, snarled traffic and overwhelmed infrastructure. Given that the port of Los Angeles is the busiest in the country, supply chain managers should take note and make plans. Meanwhile, El Nino causes droughts in other parts of the world, such as Brazil where an ongoing drought has already caused the price of sugar to surge. Companies that plan with these events in mind are better able to decide when and where to procure raw materials such as sugar, protecting their own profit margins and driving a competitive advantage.

Finally, there are the long-term effects of climate change that companies should consider as they build their supply chains for resiliency. U.S. Department of Agriculture data indicates a clear migration north for corn yields, which in North Dakota, can be attributed to growing seasons lengthening by 12 days and average temperatures rising by 2.7 degrees Fahrenheit, according to North Dakota State University. That’s a slow-moving but dramatic shift, and some food industry companies are increasingly concerned about the long-term sustainability of supply. They are considering the right breadth and depth of supply over the next five or 10 years, and how much static inventory they should hold on hand in the case of disruption.

The Outlook

In response to these climate challenges, executives need to seek better visibility into their own supply chains and grapple with greater complexity. They need to understand the entire ecosystem - not only their suppliers, but their suppliers’ suppliers, and their suppliers’ suppliers’ suppliers. By knitting together this ecosystem, leveraging external data sources, and identifying brittle areas in the supply chain, executives can take measures to build resiliency that doesn’t disrupt their business strategy.

RELATED CONTENT

RELATED VIDEOS

Business Strategy Alignment Global Supply Chain Management Supply Chain Security & Risk Mgmt Retail
KEYWORDS Business Disruption Business Strategy Alignment contingency planning Director Glen Goldbach Global Supply Chain Management Principal PwC PwC; Christoph Hahn PwC; Kelvin Harris Retail SC Security & Risk Mgmt Supply Chain Analysis & Consulting Supply Chain Management: Supply Chain security and Risk Management Supply Chain Risk Management supply chain security
  • Related Articles

    As Businesses Include Climate Change in Supply Chain Risk Plans, Property Insurers Don't Keep Pace

    Climate Change and the Impact on Supply Chains

SupplyChainBrain

Manifest Las Vegas Announces 2023 Sponsors, Discounted Tickets

More from this author

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • coworkers collaborate

    Podcast | Linking Planning and Execution for Real-Time Decision-Making

    Sales & Operations Planning
  • FedEx

    FedEx Faces Big Changes as New Boss Confronts Higher Costs, Angry Contractors

    Last Mile Delivery
  • cyber crime

    The Cyber Blind Spot That Makes Every Supply Chain Vulnerable

    Regulation & Compliance
  • 0627_Guitars.png

    Sweetwater Responds to the ‘New Face of Agility’ in Supply Chain and Merchandising

    Inventory Planning/ Optimization
  • Port of Long Beach

    Supply Issues Account for Half of Surge in U.S. Inflation, Study Says

    Global Supply Chain Management

Digital Edition

Scb may 2022 sm

2022 Supply Chain ESG Guide

VIEW THE LATEST ISSUE

Case Studies

  • 3PL Doubles Productivity With Robots to Fulfill Medical Supply Orders

  • E-Commerce Company Cuts Order Fulfillment Time by 40%

  • Fashion Retailer Halves Fulfillment Time With Omichannel Automation

  • Distributor Scales Business by Integrating Warehouse Automaton Software

  • Fast-Growing Fashion Brand Scales E-Commerce Fulfillment With Whiplash

Visit Our Sponsors

Yang Ming Alithya Barcoding
Blue Yonder BNSF Logistics Generix
GEP GreyOrange Here
Honeywell Intelligrated IFM Inmar
Keelvar Kinaxis Korber
Liberty SBF Locus Robotics Logility
Lucas Systems Nvidia Old Dominion
ORTEC Parsyl QIMA
Redwood Logistics Saddle Creek Logistics Schneider Dedicated
Setlog Holding AG Ship4WD Shipwell
Tecsys TGW Systems Thomson Reuters
Tive Trailer Bridge Vecna Robotics
Verity
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2022 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing