In our focus on supply chain strategy and business process transformation, Supply Chain Matters would like to call our reader’s attention to statements from the CEO of BMW regarding supply chain strategy.
Background
In our prelude to our research arm’s published 2023 Predictions for Industry and Global Supply Chains (Available for complimentary downloading in our Research Center), we noted that after three plus years of pandemic impacts, C-Suite executives have garnered more direct appreciation and interest in supply chain strategy and its impacts and enablers of overall product and business strategy.
During the pandemic, supply chain was often a topic having to be discussed in briefings to board members and to investors, and initially, not in a positive sense.
In 2023, having first-hand knowledge of existing or transforming supply chain capabilities is indeed of key importance in articulating an overall business strategy.
The Example of BMW
Last week, Bloomberg reported highlights of luxury automaker BMW’s CEO Oliver Zipse speaking remarks delivered at the Shanghai Auto Show. They included a statement that because of the impacts and derived learning from the Covid-19 pandemic, this automaker has adopted “a completely new approach” to the company’s supply chain strategy.
Indicated was a deeper focus on upstream supply network partners “all the way back to tier five, six and even seven suppliers” in efforts to limit supply risk. In a media briefing, the CEO cited a “local for local” strategy applies to major product selling regions including China, Europe and the United States.
We highlight this example because quite frankly, three to four years ago, we would have been quite surprised to hear of such supply chain strategy articulation from no more than just a handful of CEO’s, mostly coming from a manufacturing intensive industry setting, or a prior leadership background involving operations and supply chain. A clear example of the latter is Tim Cook, CEO of Apple whose management career included leadership of the company’s global supply chain strategies when the late Steve Jobs was CEO.
To provide added perspective, we suggest readers have a view of a recorded Bloomberg video interview of BMW CEO Oliver Zipse one year ago, in April 2022.
Take note of the statements such as: “whatever you do (as a company), flexibility is critical” along with articulation of the importance of the proximity of critical materials to key markets being served or the needs for supply chain resilience to market changes. Other statements relate to the ability to increase supply as market demands warrant, and with the ability to respond. He further articulates his knowledge of the global wide semiconductor shortage and its impact on the industry, and specifically for BMW.
Reader Takeaway
Indeed, many more C-Suite executives are seeking and garnering added awareness, education and understanding to the supply chain’s support and impact on business outcomes. With that comes the needed leadership, advocacy and sponsorship for required transformational needs.
Keep all of this in mind in your organization’s efforts because such awareness and understanding was not always prevalent. Now it is much more prevalent and with that, there is a supply chain input expected in business strategy discussions.
Bob Ferrari
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