Op-Ed: Get Ahead of Brexit’s Supply Chain Disruption Before It’s Too Late
Brexit, Britain’s decision to withdraw from the European Union (EU), is likely to cause one of the most significant disruptions to the supply chain industry in recent history.
And this particular disruption is unprecedented in many ways.
Compared to the tragic tsunami that impacted Japan in 2011 and kicked many organizations’ supply chain contingency plans into overdrive overnight, the terms of the Brexit withdrawal make the looming supply chain disruption seem like an insidious illness—we know it is coming but we don’t yet know the extent of its ramifications or the timing.
The Brexit disruption is also quite different from Y2K’s impact on supply chains—an event that was to take place at a precise time and for which organizations had time to ramp up departments and create entire companies to provide large-scale support.
Unlike the Japan tsunami and Y2K, Brexit’s impact on supply chains has started and will likely gradually increase in complexity over time in ways we can’t predict. Supply chain leaders would be well-served to get ahead of the disruption as quickly as possible and form an action plan during the two-year negotiation period—before it’s too late.
In a situation fraught with uncertainty, the first step is to review what’s known. The most recent data tells us that the effects of Brexit are being felt by way of increased inflation and a sustained devaluation of the British currency. Higher inflation (expected to reach almost 3 percent next year) and a weaker exchange rate together make for an increased cost of imports. With Britain’s position as a net importer spiking this summer, organizations with supply chains involving Britain will likely face cost pressures. As for exports, the long-term impact remains unknown, as trade deals have yet to be negotiated. That said, one should assume some tightening from the EU, one of Britain’s largest trading partners.
Hence the analogy of Brexit’s disruption to an insidious disease: we know it’s coming, and it likely won’t be good, but there is more that we don’t know, than we do know. So, how can supply chain leaders navigate through the uncertainty? There are three key imperatives—and they all involve people.
Strategic agility
Being nimble enough to respond to unknown challenges and adapt to an uncertain future will be critical as Brexit’s ramifications amplify. Evaluating options like, “Are we able to source alternate component manufacturers, if need be?”and “Will our manufacturers be able to handle increased volume on short notice?” and “Should we shift more assembly to a new location?” will be critical to navigating the uncharted waters ahead. While these decisions are typically made at senior levels of organizational hierarchies, often with limited data to support, we would suggest that supply chain organizations should shift their approach.
If we posit that organizations don’t get things done, but rather people do, supply chain leaders would be well-served to augment their strategic planning and execution capabilities by creating a cross-functional team of employees who are excited by the challenge of responding to Brexit’s supply chain disruption.
Leaders should take people off the line from the distribution and packaging department and put them in a room with sourcing associates and employees from manufacturing and cost accounting. Then, after sharing the available near-term data with the group, leaders should ask these individuals to collectively explore where the organization could look for opportunities, and how the company could get ahead of anticipated barriers or challenges. We’ve seen these types of coalitions generate effective and creative approaches to obstacles that “management” may not have ever considered.
Cost management
Almost every sophisticated supply chain organization has cost management built into the core of its operations. But to get more juice out of the orange, you need to squeeze it differently.
Before the cost pressures from Brexit further intensify, leaders have the opportunity to reframe the organization’s approach to cost management. Doing so will involve creating a positive, aspirational opportunity that everyone in the supply chain and throughout the company can engage in. Communicating this vision broadly will generate momentum toward “finding new or improving old” cost management initiatives. While not all initiatives will lead to $400,000 cost reductions, when combined with the positive approach (versus a punitive “stick” approach), leaders can create better results and happier people—a win-win for everyone. We’ve seen multiple $50,000 cost-saving initiatives that very quickly add up to some impressive numbers.
Functional flexibility
Networks will beat hierarchies in any match-up. Their secret? Networks deliver “functional flexibility.” By creating a powerful, cross-functional supply chain network where people who spot opportunities or issues are given permission to immediately respond, supply chain leaders will foster this functional flexibility. This is key to managing disruptions—especially those like Brexit, where organizations can’t anticipate every impact.
Compare a culture of functional flexibility to that of a rigid, highly structured hierarchy where, if an employee has an idea or identifies an issue, that individual tells his or her boss, who, in turn, may (or may not) tell his or her boss. Then, the idea either gathers dust or is put onto a list of action items that someone, somewhere will be tasked with. Functional flexibility is different; it acknowledges that leaders exist at all levels and are not a threat to the hierarchy. It also empowers organizations to create and harness a powerful source of execution capability by carefully and cleverly tapping into the minds of hundreds, perhaps even thousands, of employees. Ultimately, functional flexibility is rooted in the belief that more people, not fewer, will lead to a better outcome.
Brexit, or any other massive disruption or transformation, should be approached boldly. By recognizing this and creating a culture of strategic agility, effective cost management and functional flexibility, pioneers in the supply chain industry will empower their organizations to navigate Brexit’s disruptions and accelerate the impact that their networks are delivering. Are you ready?
Russell Raath is a president at Kotter International, the leadership and strategy acceleration firm founded by renowned Harvard Business School professor Dr. John Kotter. He can be reached at russell@kotterinternational.com.
Source: SJ Sourcing Journal – GAI
La Journée Construction Acier 2016 – Participation gratuite
La Journée Construction Acier 2016 est, avec l’Expo Construction Métallique, plus de 20 conférences et la remise des différents prix,l’événement majeur de la « construction métallique » en Belgique.
Plus de 500 participants sont attendus, dont une majorité de professionnels et tous ceux qui sont intéressés par la construction en acier.
La participation est gratuite après inscriptionpréalable.
Norwegian Steel Day 2016
3. November
Hotel Bristol, Oslo, Norway
PROGRAM
08:00 Registration and coffee
08:50 Opening
– Welcoming and a presentation of the exhibitors
Subject: Economy and Market
09:00 The drop in Oil prices and the Prospects of the Norwegian Economy
– Norwegian Economy without the drive of the oil. Which industries will take its place?
by Ida Wolden Bache, Director of monetary policy, Norges Bank
09:30 The Near future of the Construction Market
– How does it look in the years ahead
by Pål Engeseth, CEO, Byggfakta
10:00 National Roundtrip
– Professional activities and a presentation of this year’s projects
by Kjetil Myhre, Manager, The Norwegian Steel Association
10:30 Coffeebreak
Subject: Bridges
11:00 Ongoing and planned Steel Bridge Projects
by Bjørn Isaksen, sectional director, Statens Vegvesen
11:25 Significance of aesthetics in bridge engineering
– Västerbron i Eskilstuna, Norges-porten i Ørje, ny bro i Norrtälje
by Fernando Ibañez, Degree of Freedom Engineers, Valencia
11:50 Network Arch Bridges
– Driva bru and Forra bru by Henning Tyvand, Johs. Holt
– A beginners manual on the design of network arches
by Prof. em. Per Tveit
12:30 Lunch
Subject: Construction
13:30 New Project at Tullinløkka, Oslo
– The university building will be 20 000 m2
by Torkel Njå, MAD arkitekter
14:00 New Økern sentrum, Oslo
– Two office buildings, a shopping center and a cinema
by architect NN, Melby arkitekter
Subject: Environment and Sustainability
14:30 Circular Economy Building: Court House Amsterdam
– steel frame, demountable hollow core slabs and computer floor
by architect Menno Rubbens, Cepezed Projects
15:00 Reuse of Steel Buildings- a Great Resource
– RIO Future Arena, to be deconstructed into 4 new schools
– London 2012 arenas, design for reuse
by Lasse Kilvær, The Norwegian Steel Association
– the DIP-project: Reuse of Steel Constructions and connected materials
by Eva Widenoja, Widenoja Design AS
15:20 Coffee break
15:50 High Strength Steel reduces Greenhouse Gas Emissions
– How to increase the use of high strength steel in construction?
by Thomas Hörnfeldt, SSAB
Subject: Materials
16:10 Wall panels and roof panels
– Design rules in case of fire, fixing and u-values
by Stefan Climent, Market Development Manager, Ruukki Construction
16:30 Weathering steel in rolled sections & MB
– use in bridges and +M / +N
by PhD Dennis Rademacher, AMEL CM, Tecom
Subject: Robotisation
17:00 Future processing equipment in the fabrication of steel
– Efficiency using CNC machines
by Mark Jones, Managing Director, FICEP UK
17:20 Experiences from using CNC machines from Voortman
by Borge Nordfjeld, EMV Construction AS
17:40 Experiences from using CNC machines from FICEP
by Geir Tindvik, Nortech
18:00 The end
18:05 Opening of the Steel Bar
19:00 Banquet – an evening of celebration with entertainment
Programme and registration: HERE
EUROMETAL STEEL NET FORUM PORTO 10-11 NOVEMBER 2016
Dear Members and Friends, attached you may find the updated version of the flyer regarding EUROMETAL Steel Net Forum IBERIA, to be convened in Porto from 10-11 November 2016.
The flyer includes the updated conference program, a registration form as well as information about the conference hotel.
Below, you will find an English version as well as a Portuguese version of the event flyer.
We are also pleased to announce that ARCELORMITTAL and MEGASA have accepted to be sponsors of EUROMETAL Steel Net Forum Iberia.
EUROMETAL STEEL NET FORUM IBERIA – PT
EUROMETAL STEEL NET FORUM IBERIA – EN
With best regards,
Georges Kirps
Director General EUROMETAL
EC heavy plate decision in November could be in 65-73% range
The European Union is likely to find provisional anti-dumping duty rates on heavy plate originating in China: from Nanjing Iron & Steel at 73%, Minmetals Medium Plate Co 65%, Wuyang 74% and all other companies at 70%, Fabricio di Gianni, partner at trade law firm Van Bael & Bellis, said at the EUROMETAL conference in Milan on Thursday.
As Platts reported, the EU opened this investigation on 13 February 2016, so that after nine months the market expects a result. However, some market players said that are actually expecting not only less than 60-70%, but rather duties of around 30%.
According to di Gianni, it is likely that the EU will impose duties on HRC in November at 15-20%, a level that other market participants agreed is likely.
He said also that there are rumours that the EU is looking into opening an investigation into galvanized coil from China and South Korea, plus alloy bar from China.
The EU has nine active AD investigations underway on steel products. In the last six months the EU imposed definitive duties in four steel-related AD cases and terminated one investigation without adopting any measures.
Annalisa Villa, PLATTS
EU distributors see margins squeezed by strip price hikes
The EU flat product distribution sector’s outlook for the last quarter of 2016 looks more challenging after a positive development during the first half of the year, Georges Kirps, general director of distributors’ group EUROMETAL said on the sidelines of the EUROMETAL conference held in Milan on Thursday and attended by Platts.
The slowdown started in July with EU shipments dipping by almost 10% as service centers faced difficulties to pass on their higher costs. “Mills pushed for higher prices but these were not sustained by the demand, and we saw this across all Europe”, Kirps commented.
“Yes, on the higher end of the chain the mills have already passed to us their price increases since July by at least €30/metric ton with further increments still in progress, but for us it still remains difficult to pass these increases on to the final market – squeezing the gross margins for distributors”, Cesare Viganò, vice-president of EUROMETAL, echoed.
According to the last EUROMETAL data, in the EU-28 the first half of 2016 service center sales increased by 1% in all strip products, with Italy seeing an increase of 3%, scoring slightly better than the EU average.
In the first seven months of 2016, EU flat service center shipments for HRC went up by 1% (Italy +3%), CRC down 2% (Italy 0%), HDG and other coated flats +4% (Italy +4%), EUROMETAL data showed.
Annalisa Villa, PLATTS
EC to probe Chinese HDG in new antidumping case: sources
The European Commission is set to announce a long-mooted anti-dumping investigation into imports of hot-dip galvanized coils from China, according to multiple sources involved in the trade.
A number of trader and mill sources have told S&P Global Platts the EC will declare its intentions “imminently” in a move that is causing consternation for traders who already feel they are being squeezed out of the market by a raft of anti-dumping measures. They comments echo those of trade lawyer Fabricio di Gianni, who told a meeting in Italy on Thursday that a case against HDG from China and Korea is expected, as Platts reported.
Traders speaking to Platts at an International Steel Trade Association event in London noted large volumes of Chinese HDG being imported recently, with Duferco and Stemcor-affiliated companies understood to be the biggest players and much of the HDG being sourced from Hebei I&S and Anshan I&S. Trading sources said that, shortly after the initiation of duties for cold rolled coil, 75,000 mt of Chinese HDG was booked, with Duferco booking over 25,000 mt.
“Chinese galv isn’t even that competitive on price right now. But on the thinner gauges, the European mills don’t want to do it. The margins aren’t there for them,” a trader said.
However, mill sources said HDG prices should be higher and that, with automotive demand being so good, they should be enjoying stronger margins. “It should help the market. There are sites in Europe that closed because they could not make profits amid Chinese competition. By closing two or three lines and then having the barriers in we can get more reasonable prices,” one mill source said.
However, Jeff Kabel, chairman of ISTA, said they would be resistance to any potential measures, noting the association “will be formulating a plan of action.”
China has been a particular target for the EC with duties already imposed in recent years for rebar, cold rolled coil and organic-coated sheet, while investigations are ongoing for plate and hot rolled coil.
Peter Brennan, PLATTS
EUROMETAL Steel Net Forum Iberia no Porto
Vimos pelo presente, anunciar a realização do EUROMETAL STEEL NET FORUM IBERIA, organizado pela AÇOMEFER em colaboração com a UAHE (Unión de Almacenistas de Hierros de España) e a EUROMETAL, que irá ter lugar no Porto, nos dias 10 e 11 de Novembro de 2016, e para o qual convidamos V. Exas., a participar.
Junto se anexa o respectivo flyer, com todos os detalhes sobre o interessante e diversificado programa do evento, bem como a ficha de inscrição e o formulário de reserva do hotel.
Para participar, solicitamos que preencham a respectiva ficha de inscrição e a devolvam para o e-mail acomefer@sapo.pt , até ao dia 31 de Outubro de 2016.
Mais se informa, que os idiomas falados na Conferência são o Português, o Inglês e Espanhol, todos com tradução simultânea, e que toda a informação sobre o Fórum se encontra no nosso site na internet .
EUROMETAL Steel Net Forum Iberia no Porto – 10-11 de Novembro 2016
Na expectativa de poder contar com a presença de V. Exas., apresentamos os melhores cumprimentos.
AÇOMEFER – Associação Portuguesa dos Grossistas de Aços, Metais e Ferramentas
Rua Filipe Folque, 67 – 5º
1050-112 Lisboa
Tel. 21 352 85 37
Norsk Ståldag 2016
3. november – Hotel Bristol, Oslo
Nå er det dags for årets store begivenhet, Norsk Ståldag, den 28. rekken.
Årets program har mange aktuelle temaer for alle som arbeider innen bygg og anlegg; byggherrer, utbyggere, arkitekter, ingeniører, entreprenører og leverandører…
PROGRAM
08:00 Registrering med kaffe
08:50 Åpning
– velkommen og presentasjon av utstillerne
Tema: Økonomi & marked
09:00 Oljeprisfallet og utsiktene for norsk økonomi
– Norsk økonomi uten oljen som vekstmotor. Hvilke næringer tar over?
ved Ida Wolden Bache, Direktør i Pengepolitikk, Norges Bank
09:30 Hvordan blir bygg- og anleggsmarkedet fremover?
ved Pål Engeseth, direktør, Byggfakta
10:00 Norge Rundt
– faglige aktiviteter og presentasjon av medlemmers prosjekter siste år
ved Kjetil Myhre, Norsk Stålforbund
10:30 Kaffepause
Tema: Bruer
11:00 Pågående og planlagte stålbru-prosjekter
ved Bjørn Isaksen, seksjonssjef, Statens Vegvesen
11:25 Significance of aesthetics in bridge engineering
– Västerbron i Eskilstuna, Norges-porten i Ørje, ny bro i Norrtälje
ved Fernando Ibañez, Degree of Freedom Engineers, Valencia
11:50 Nye spenstige nettverksbogebruer
– Driva bru og Forra bru
ved Henning Tyvand, Johs. Holt
12:10 A beginners manual on the design of network arches
ved Prof. em. Per Tveit
12:30 Lunsj
Tema: Bygg
13:30 Nytt bygg på Tullinløkka
– universitetsbygget vil bli på drøyt 20 000 kvm
ved Torkel Njå, MAD arkitekter
14:00 Nytt Økern sentrum
– to kontorbygg, et kjøpesenter, en kino
Tema: Miljø
14:30 Circular Economy Building: Courthouse Amsterdam
– steel frame, demountable hollow core slabs and computer floor
ved arkitekt Menno Rubbens, Cepezed Projects
15:00 Ombruk av stålbygg – en stor miljøgevinst
– RIO Future Arena, vil bli demontert og bli til 4 nye skoler
– London 2012 – 4 areaner designet for ombruk
ved Lasse Kilvær, Norsk Stålforbund
– DIP-prosjektet: Ombruk av stålbygg og tilknyttede materialer
Eva Widenoja, Widenoja Design AS
15:20 Kaffepause
15:50 Høyfast stål reduserer klimagassutslippet
– hvordan øke bruken av høyfast stål i bygg og anlegg?
ved Thomas Hörnfeldt, SSAB
Tema: Materialer
16:10 Veggelementer og takplater
– designregler mhp brann, innfesting og u-verdier
ved Stefan Climent, Market Development Manager, Ruukki Construction
16:30 Weathering steel in rolled sections & MB
– use in bridges and +M / +N
ved PhD Dennis Rademacher, AMEL CM, Tecom
Tema: Robotisering
17:00 Framtidens prosessutstyr i fabrikasjon av stål
– effektivisering ved hjelp av CNC-styrte maskiner
ved Mark Jones, Managing Directo, FICEP UK
17:20 Erfaringer fra bruk CNC-styrte maskiner fra Voortman
ved Verner Fagerli, EMV Construction
17:40 Erfaringer fra bruk CNC-styrte maskiner fra FICEP
ved Geir Tindvik, Nortech
18:00 Slutt
18:05 Stålbaren åpner
19:00 Bankett – en festaften med underholdning
For fullstendig progam og påmelding: klikk HER
Med hilsen / best regards
Kjetil Myhre, daglig leder / manager
Norsk Stålforbund / Norwegian Steel Association
Tel: +47 41 02 15 98
https://www.stalforbund.no
Klöckner bets more on aluminium in automotive
Germany-based steel distribution group Klöckner & Co has given the go-ahead to a second phase of investment in its new aluminum service center. Through its subsidiary Becker Stahl-Service, Klöckner is building a service center at its Bönen location in North Rhine-Westphalia, to process aluminum flat products for the automotive and manufacturing industries in Europe.
Work on the slitting line, already under construction, is going to plan, with completion slated for next year. Construction of a supplementary cut-to-length line is scheduled to start in early 2017, the company said Thursday.
The plant marks the biggest investment in Klöckner & Co’s corporate history, totaling some €35 million, and is expected to reach its full 80,000 metric tons/year aluminum processing capacity in 2018. The new business will operate under the name Becker Aluminium Service.
“By 2020 at the latest, we aim to generate the lion’s share of group sales with higher value-added products and services. Systematically expanding our business with aluminum, which is a key material for the future, will play an important part in attaining this goal”, Gisbert Rühl, CEO of Klöckner, said in the statement sent to Platts.
Becker Stahl-Service currently specializes in the processing and distribution of flat steel products with shipments exceeding 1 million mt/y. Its main customers are the automotive industry as well as other sectors of industry and steel distributors.
Henry Cooke, PLATTS