Perspectives on Various Issues of Interest

Investiture - Eli Broad Endowed Professorship

I am thankful to the Eli Broad Endowment Fund, my mentors, research collaborators, students, and well-wishers...🙏

 

 

United Nations World Food Programme wins Nobel Peace Prize for efforts to combat hunger

 

Design and Technological Innovation - The North American International Auto Show 2018

Sharing some of the stunning models and technological innovations at the North American International Auto Show in Detroit...

Future of Procurement

Chick and Handfield (2016) offer the following perspectives for procurement's value proposition and the evolution of procurement’s value proposition.

Source: Chick, G., Handfield, R. 2016. A look into the future of procurement. CSCMP Supply Chain Quarterly, Quarter 1, 2016. 

2015 ISM - Michigan State University Leaders and Innovators in Supply Management

AWARD CATEGORY: Transformation of the Organization

COMPANY: Flextronics

REVENUE: US $26 billion

NUMBER OF EMPLOYEES WORLDWIDE: 151,342

NUMBER OF GLOBAL PROCUREMENT AND SUPPLY CHAIN EMPLOYEES WORLDWIDE: 2,691 employees with solid-line reporting to the organization, with approximately 9,000 in the procurement and supply chain community globally

COMPANY DESCRIPTION: Flextronics is a leading end-to-end supply chain solutions company that delivers design, engineering, manufacturing and logistics services to a range of industries and end markets, including data networking, telecom, enterprise computing and storage, industrial, capital equipment, appliances, automation, medical, automotive, aerospace and defense, energy, mobile, computing and other electronic product categories. Flextronics' service offerings and vertically integrated component technologies optimizes customer supply chains by lowering costs, reducing supply chain risk, increasing flexibility and reducing time to market.

PROJECT FOCUS: To support a companywide transformation, Flextronics' new global procurement and supply chain (GPSC) organization moved from a decentralized to a centralized, center-led structure. Under the direction of a new chief procurement and supply chain officer, all front-end customer supply chain management organizations were consolidated under GPSC along with procurement, and materials and logistics to create an end-to-end supply chain organization.

KEY SUCCESS: In addition to providing organizational synergy to Flextronics, GPSC achieved additional cost savings of $217 million in materials in the first year after centralization. The centralized materials organization increased supplier-managed inventory from 28 percent to 45 percent in the same period, boosting cash generation by $180 million. It also released a policy manual for employees world-wide, provided online training and is beginning to audit for compliance.

KEY INDIVIDUALS: Heimo Trampitsch, senior vice president, materials and logistics; Peter Gutschi, senior vice president, indirect procurement; Tom Linton, senior vice president, strategy supply chain management - integrated network solutions; Daniel Koh, vice president, global commodity management - electrical and components; George O'Kelly, vice president, global commodity management - mechanical and components; Majid Sairafi, vice president, strategic supply chain management - industrial and emerging industries; Purnima Wagle, vice president, chief of staff and business transformation. and Karen Francis, executive assistant. Cross-functional team: Pankaj Srivastava, vice president, finance; Ricardo Basave, senior director, finance; Ben Warnet, vice president, legal; Stephanie Boman, vice president, HR business partner; and Kerry McCracken, vice president IT.

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AWARD CATEGORY: Process

COMPANY: Raytheon

REVENUE: US $6.085 billion (2014)

NUMBER OF EMPLOYEES WORLDWIDE: More than 14,000

NUMBER OF INTEGRATED SUPPLY CHAIN EMPLOYEES WORLDWIDE: 478

COMPANY DESCRIPTION: With a history of innovation spanning 92 years, Raytheon is a technology and innovation leader specializing in defense, security and civil markets throughout the world. Raytheon Integrated Defense Systems (IDS) specializes in air and missile defense, large land- and sea-based radars and systems for managing command, control, violence and reconnaissance. It also produces air-traffic management systems, sonars, torpedoes and electronic systems for ships.

PROJECT FOCUS: IDS' Integrated Supply Chain (ISC) began a multi-phased approach to becoming the supplier customer of choice by operating in new ways, driving affordability and making collaboration integral to building strategic relationships with suppliers. A strategic sourcing organization, comprising supply chain, engineering, quality and finance, was created. A patented seven-step process was developed, guiding the organization in strategic sourcing strategies in specific supplier categories, optimizing designs, analyzing current and future spend, and using data to understand how categories align across the organization.

KEY SUCCESSES: A tiered Raytheon Supplier Excellence Program was created and a Supplier Advisory Council, consisting of senior executives from 13 supplier companies and IDS' ISC leadership, was established. The cross-functional strategic sourcing organization delivered more than 30 percent savings and realized a 35 percent increase in the number of strategic agreements. The ISC organization has established itself as a critical competitive differentiator for the business.

Key Individuals: Mike Shaughnessy, vice president, integrated supply chain; Janet Groebe, senior director, supply chain execution; Neil Perry, director, supply chain operations; John O'Sullivan, Swenson, director, engineering; Netta Lomasney, acting director, supplier quality mission assurance; and Julia Saulino, senior manager, supplier quality.

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AWARD CATEGORY: Sustainability

COMPANY: ConocoPhillips

REVENUE: US $55.52 billion (2014 total revenue and other income)

NUMBER OF EMPLOYEES WORLDWIDE: Approx. 19,100 as of December 31, 2014

NUMBER OF SUPPLY MANAGEMENT EMPLOYEES: 780 (2014)

COMPANY DESCRIPTION: The company explore for, produce, transport, and market crude oil, natural gas, natural gas liquids, liquefied natural gas and bitumen on a worldwide basis - the energy that plays a foundational role in enabling global economic development and human progress. The company is the world's largest independent exploration and production company, based on proven reserves and production of liquids and natural gas. A commitment to safety, operating excellence and environmental stewardship guide the company's operations.

PROJECT FOCUS: Local content.

KEY SUCCESSES: From January 2012 to June 2014: engaged 3,114 representatives of the local supplier community on potential supply opportunities through 24 supplier information sessions conducted throughout Australia; a total of 2,282 supplier have registered their capability through the APLNG supplier portal on the project's supplier registration and information service at www.aplng.icn.org.au; and at the end of June 2014 the cumulative expenditure for the project sourced in Australia reached AUD$15 billion, approximately 71 percent of all project spend.

Key Individuals: Ken Wise, APLNG Downstream Project; Joe Hinojosa, Australia Business Unit East Supply Chain - Brisbane; Tom Curtis, APLNG Upstream Origin; Tim McGrath, APLNG Upstream Origin - Brisbane; Robert Gibb, APLNG Downstream - Gladstone; John Davies, APLNG Downstream - Gladstone; Bob Sevitz, APLNG Upstream - Brisbane; Nage Moummar, Australia Business Unit East - Brisbane.

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AWARD CATEGORY: People

COMPANY: John Deere

REVENUE: 2014 worldwide revenue US $36 billion

NUMBER OF EMPLOYEES WORLDWIDE: Approx. 60,000

NUMBER OF SUPPLY MANAGEMENT EMPLOYEES: Approx. 2,590

COMPANY DESCRIPTION: John Deere is a world leader in providing advanced products and services and is committed to the success of those linked to the land - those who cultivate, harvest, transform, enrich, and build upon the land - to meet the world's dramatically increasing need for food, fuel, shelter and infrastructure.

PROJECT FOCUS: John Deere's internship program has evolved into a more robust program that provides meaningful work to interns and tangible benefits to the business. Successful interns are hired into the supply management development program (SMDP) a three-year rotational program, to provide them with experience across several functional disciplines of supply management.

KEY SUCCESSES: Benefits of the program are varied and include identified cost savings, process efficiencies and improved knowledge management. During summer 2014, interns identified more than $9 million in savings across a number of areas, and realized a number of intangible benefits to improve supply management's efficiency and effectiveness.

KEY INDIVIDUALS: Pierre Guyot, vice president global supply management and logistics; Kelly Duff-Morgan, WWSM strategic planning manager; Kimberly Normoyle, WWSM indirect materials and services director; Rachel Lanning, C&F division supply management manager; Christina Cogdill, WWSM compliance manager; Alec Alessandra, WWSM compliance and strategic planning director; MaryAnn Lindsay, recruiter and intern coordinator.

Implementation

Survey results from more than 2000 global executives provide insights regarding the implementation process:

1)      Implementation matters

2)      Secrets of world’s best implementers

Source: Pustkowski, R., Scott, J. and Tesvic, J. 2014. Why implementation matters. McKinsey & Company, August 2014.

The Purpose of Universities

Recently I came across a review of the book entitled, "What are Universities For?" By Stefan Collini (Penguin Group). I found the following points very interesting:

1) In the book Professor Collini says that universities, "provide a home for attempts to extend and deepen human understanding in ways which are, simultaneously, disciplined and illuminable."

2) The author's position is in concert with that held by Cardinal Newman who once said, "A university training is the great ordinary means to a great but ordinary end; it aims at raising the intellectual tone of society...It is the education which gives a man a clear conscious view of his own opinions and judgments, a truth in developing them, an eloquence in expressing them and a force in urging them."

3) Professor Collini emphasizes that a liberal education is not about what students learn or what skills they acquire but "the perspective they have on the place of their knowledge in a wider map of human understanding".

Key Regulatory & Industry Guidelines for Pharmaceutical Cold Chain

Bishara (2006) summarizes the key regulatory and industry guidelines for pharmaceutical cold chain as follows:

The World Health Organization’s (WHO) working document QAS/04.068 on Good Distribution Practices (GDP) is applicable to all persons and companies involved in the distribution of pharmaceutical products including the: “manufacturers of intermediate and/or finished products, brokers, suppliers, distributors, wholesalers, traders, transport companies, forwarding agents, processors, etc.” This WHO document indicates that the distribution process has generally been “neglected” regarding the: “establishment, development, maintenance and control over the activities involved.” Further, because the distribution segment of the pharmaceutical supply chain involves multiple parties, the risks involved become complex. As stated in the (WHO) working document QAS/04.068: “In order to maintain the original quality, every activity in the distribution of pharmaceutical products should be carried out accordingto the principals of GMP, Good Storage Practice (GSP) and Good Distribution Practice (GDP).” The (WHO) working document QAS/04.068 states: “where special storage conditions (e.g. temperature and relative humidity) are required during transit, these should be provided, checked, monitored and recorded.” It goes on to state: “Temperature mapping of vehicles (where applicable)should support uniformity of the temperature across the vehicle. Recordedtemperature monitoring data should be available for review.” The overall objective of these guidelines is to: “ensure the quality and integrity of pharmaceutical products during all aspects of the distribution process.”

The International Conference on Harmonization document (ICH Q1A (R2)) states: “a drug product should be evaluated under storage conditions (with appropriate tolerances) that test the thermal stability and, if applicable, its sensitivity to moisture or potential for solvent loss. The storage conditions and the lengths of studies chosen should be sufficient to cover storage, shipment, and subsequent use.” Furthermore,“data from the accelerated storage condition and, if appropriate, from the intermediate storage condition may be used to evaluate the effect of short term temperature excursions outside the label storage conditions (such as might occur during shipping).”

The Food and Drug Administration (FDA) Guidance on Stability for the industry notes that adverse shipping and/or environmental conditions may affect the product quality. Deficiencies in good distribution practices with specific focus on temperature control and monitoring during shipment have been cited by the FDA. Several studies by the United States Pharmacopeia (USP) demonstrated temperature and humidity variations during shipping of drugs and vaccines. Time and temperature recording devices documented values as high as 60°C.

The USP standards are cited in <1079> Good Storage and Shipping Practices. USP <1079> describes procedures to maintain proper storage environments for individual articles and ensure the preparation’s integrity until it reaches the user. Risks associated with distribution routes include exposure to temperature excursions, humidity, light and oxygen.Pertinent sections include: “Storage in Warehouses, Pharmacies, Trucks,Shipping Docks, and Other Locations”, “Controlled Room Temperature”,“Personnel Training”, “Qualification of “Cold” Equipment or Stores”,“Distribution and Shipment of Pharmacopeial Articles”, “Qualification Protocol”, “Temperature Challenges”, “Receipt of Pharmaceutical Articles”, “Distribution or Shipping Vehicles”, “Vehicle Qualification”,“Pharmaceutical Delivery Staff”, “Shipment from Manufacturer to Wholesaler”, “Shipment from Manufacturer or Wholesaler to Pharmacy”,“Shipment from Pharmacy to Patient or Customer”, and “Storage of Physician Samples Handled by Sales Representative in Automobiles”.

Recently, Health Canada has published guidelines that place greater responsibility on members of the supply chain including manufacturers,distributors, transporters and retailers to ensure that the drug products will reach the customer uncompromised.The key concepts presented in the European Union Guidance on Good Distribution Practices include: “The quality system operated by distributors (wholesalers) of medicinal products should ensure that storage conditions are observed at all times, including during transportation” and “products requiring controlled temperature storage should also be transportedby appropriately specialized means.”

Source: Bishara, R. 2006. Cold Chain Management - An Essential Component of the Global Pharmaceutical Supply Chain. American Pharmaceutical Review, January/February.

Return on Investment from a College Degree

PayScale, a Seattle-based company collects wage information to calculate 30-year net return in investment for college education. According to the recent research, graduates of top schools will earn $1 million more than a typical high school grad. Average 30-year net return on investment for 554 schools is pegged at 9 percent. Only 88 schools had an ROI that topped that total return for the S&P 500 (11.1%) over the same period (The corresponding returns for gold and 30-year treasuries were 2.6% and 4%, respectively).

Schools with the best 30-year net ROI over wages earned by a typical high school graduate:

School Total Cost ROI

1. MIT $189,300 $1,688,000

2. California Inst. of Tech. $181,100 $1,644,000

3. Harvard $189,600 $1,631,000

4. Harvey Mudd $187,700 $1,627,000

5. Dartmouth $188,400 $1,587,000

6. Stanford $191,800 $1,565,000

7. Princeton $187,700 $1,517,000

8. Yale $194,200 $1,392,000

9. Notre Dame $181,900 $1,384,000

10. Univ. of Pennsylvania $191,300 $1,361,000

Source: "College Degrees Get an Audit." Bloomberg Businessweek, June 28 - July 4, 2010

Myths and Realities About Green

1.     Myth: Bottled water is safer than tap water.

    Reality: Tap water is subject to stricter government standards. In United States, the EPA requires large municipalities to test water for bacteria in an independent lab a dozen times a day. On the other hand, the FDA mandates that water used for bottling be analyzed only once a week for bacteria. Water that's packaged and sold in the same state - about 70% of the bottled water sold in the U.S. - is exempt from federal regulation because it doesn't cross state lines. Americans gulp down 28.5 gallons of bottled water per capital each year, discarding billions of plastic containers. 

2.    Myth: Buying local food is good for the government.

    Reality: It depends on how your food was produced and delivered. According to a report titled, "Fair mile - Recharting the Food Miles Map," a tomato trucked from Spain to Britain may be more environmentally friendly than a tomato grown in a greenhouse in Britain because that process needs energy intense farming techniques and more fertilizer and could degrade the soil.

3.    Myth: Organic foods are produced without pesticides.

    Reality: Organic guidelines need to be tightened up. Great many pesticides are permitted in organic farming, and some of them are considered lethal to humans in very small quantities - like nicotine sulfate and lime sulfur, both of which carry a "danger" warning from the FDA but are permissible under organic-farming guidelines.

4.    Myth: Cars are one of the biggest emitters of greenhouse gas.

    Reality: Yes, but those hamburgers you like to gobble down are actually much worse. According to a report by the UN's Food and Agriculture, meat accounts for 18% of the greenhouse gases the world produces every year, compared with 13% for vehicles. Other studies put that percentage  even higher. 

5.    Myth: It's okay to put plastic containers in microwaves.

    Reality: Stick to ceramic ware. Even though something is labeled as safe for use in the microwave, it may not be so. A substance used to make polycarbonate plastic - bisphenol A, more commonly known as BPA - could leach into your food and disrupt your hormonal system.

6.    Myth: Fluorescent bulbs are bad since they contain mercury.

    Reality: Yes, but not using them will pour even more mercury into ecosystem. Compact fluoroscent light bulbs (CFLs) consume 75% less electricity than traditional light bulbs. Incidentally, although CFLs contain mercury, using them reduces mercury in the atmosphere since it helps in cutting down the consumption of electricity generated in majority of cases by coal-fired power plants (the leading source of mercury emission in the U.S.). According to Energy Star, a 60-watt incandescent bulb adds 5.8 milligrams of mercury into the environment over its lifetime vs. 1.8 milligrams for a comparable CFL.

7.    Myth: I should wait for all my incandescent bulbs to burn out before replacing them with low-energy fluoresents.

    Reality: You'd be wasting a lot of money and energy. According to scientists at Sandia National Laboratories, you'd save money by tossing a new 60-watt incandescent and replacing it with a fluorescent since the money you'd save on your electric bill with the CFL would more than make up for the cost of both bulbs. Over the CFL's 12,000-hour lifetime, you would save some $51.

8.    Myth: It's better to buy an artificial christmas tree than cut down an evergreen every year.

    Reality: Get out your ax. It is important to think about of renewable and nonrenewable resources in this case. Once a tree is cut, it can be grown again and the trees once used in the home can be turned into mulch. 350 million Christmas trees are growing in U.S. farms and 30 million trees are sold each each. The trees growing in the farms store carbon, thereby, favorably impacting the environment. Most artificial Christman trees are made of nonrenewable plastics, and furthermore, according to U.S. Census Bureau, last year 92% of these plastic trees made their trip from China.

9.    Myth: Paper grocery bags are better than plastic ones.

    Reality: Plastics, young man, plastics. According to Franklin Associates, a waste management firm, it takes four times more energy to produce a paper bag than a plastic one.

10.    Myth: My jeans are made of organic cotton so it's okay to buy as many pairs as I want.

    Reality: When it comes to wasting water, organic jeans are as bad as regular ones. It takes as much as 2,100 gallons of water to grow enough cotton – organic or otherwise – to produce just one pair of jeans, not including the water used to dye and finish the fabric.

11.    Myth: I'll save energy if I keep my appliances turned off.

    Reality: Yes, but not as much as you think. According to Lawrence Berkeley National Laboratory, 5% to 10% of residential electricity use can be attributed to standby power.

12.    Myth: Soon jets will run on biofuels, enabling us to fly guilt-free.

    Reality: Time to come down to earth. Ethanol provides roughly a third less energy per gallon than jet fuel. This will necessitate a bigger fuel tank, which means a bigger, stronger plane will need to be designed. This in turn will need more fuel, resulting in a vicious cycle making ethanol impractical. Airlines have been testing fuels made from jatropha and palm oils, but those fuels remain expensive and lack the hydrocarbon rings that interact with the seals in current engines.

13.    Myth: We can meet our energy needs and global - warming targets with wind and solar power.

    Reality:While the solar and wind industries have been growing rapidly over the past decade, those two sources of power together account for less than 2% of all the electricity American use. Solar typically is still two to three times more expensive than coal, and while wind in many places can compete with fossil fuel, it isn't a dependable source of power. 

14.    Myth: It doesn't pay to turn down your thermostat when you're not home.

    Reality: The energy needed to reheat a home is pretty much equal to the energy saved when it cools down. 

15.    Myth: For your home to be green, you need a high-efficiency furnace, not to mention high-efficiency appliances and windows.

    Reality: It doesn't matter how efficient your furnace is if it's heating the outside of your house. According to experts from Natural Resource Defense Council, it is more useful to hire a professional to plug all the leaks in the home since it makes the old furnace operate better.

16.    Myth: Plant more trees in the city because they absorb carbon.

    Reality: The maintenance of urban trees makes it unlikely they are net stores of carbon.

17.    Myth: Climate change critics like to point out that the weather has gotten cooler over the past decade, so how can there be global warming?

    Reality: According to a new study by NASA, the past decade was the warmest on record since the 1880s.

18.    Myth: Offsets are the answer to climate change.

    Reality: It is difficult to ensure that carbon is actually reduced by means of the carbon offsets bought by companies to compensate their carbon dioxide emissions.

19.    Myth: Snowy winters equal no global warming.

    Reality: Weather is not the same thing as climate. Climate scientists argue that bigger snowfalls are consistent with climate change because warmer temperature mean more moisture evaporating into the atmosphere and hence more rain and snow. 

20.    Myth: You need to warm up your car before driving it.

    Reality: Idling the car for a few minutes in winter just wastes gasoline. According to an EDF report published last year, unnecessary idling will waste between $44 and $392 on fuel annually (depending on fuel prices, idling habits, and vehicle type). Two extra restarts each day will average about $10 a year in repairs since shutting the car on and off wear down the starter and battery.

21.    Myth: I'd never buy an electric car because I'd run out of power and be stranded.

    Reality: A study by Chrysler found that 80% of American drivers travel 40 miles or less each day (the distance being even shorter in Europe), and hence the probability of power running out is low.

22.    Myth: Electric cars rated to go 100 miles will make it that far.

    Reality: Electric-car batteries are rated when the car is being driven in temperatures of around 70 degrees and on flat terrain.

23.    Myth: Car air conditioning wastes energy.

    Reality: According to Consumer Reports running the AC will decrease performance by two to four miles per gallon. However, Consumer Reports tested a Toyota Camry at 65 mph and found that AC use burned only slightly more energy than with windows open.

24.    Myth: Hybrids are much better for the environment than regular cars.

    Reality: Not all hybrids are created equal.

25.    Myth: Driving fewer miles is good for the environment.

    Reality: The shortest distance between two points is not always the greenest.

Source: "25 truths about green" Fortune, April 12, 2010.