Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
If the last couple of months haven't suggested just how vulnerable businesses can be, wherever they are located geographically or along the supply chain spectrum, I guess nothing will. That problems related to the U.S. housing market eventually led to economic chaos in Iceland says a lot about how interconnected we have all become.
For those whose livelihoods are closely connected to supply chains, the vulnerability comes as no surprise. For the last several years, nearly every industry conference has featured presentations on supply chain resilience or adaptability or agility. Much of that came out of concerns over how to prepare for disruptions resulting from physical events like hurricanes and fires, human actions like strikes and terrorist attacks, and other potential dangers—think bird flu. While financial disasters have not been at the center of most of these discussions, the same message applies: It is not pessimism to assume that in highly complex supply chains, something will go wrong somewhere, sometime and that preparation is essential.
A recent study published by the global consulting giant McKinsey & Co. in its business journal, The McKinsey Quarterly, indicates that supply chain executives are acutely aware of all this. The survey of C-level and operations executives in 49 countries revealed a consensus that "supply chain risk is rising sharply."
"Executives point to the greater complexity of products and services, higher energy prices, and increasing financial volatility as top factors influencing their supply chain strategies," the report on the survey said.
Issues of the moment appear to drive much of the thinking. For instance, energy prices were second only to complexity when respondents identified the most influential factors on supply chain strategy back in June 2008. My guess is that if the survey were conducted today, financial risk might vault to the top of the list.
That's not an indictment of short-term thinking. Businesses have to execute every day and deal with the issues facing them right now. It is the lack of corporate focus on major risks that raises a red flag. The results suggest that many companies are doing precious little to mitigate or prepare for those risks. "Despite the importance respondents place on these trends," the report says, "relatively few say that their companies are acting on them."
Given the severe challenges that businesses around the world face right now, that could be discouraging news. We can have the small comfort of knowing that businesses everywhere are very much in the same boat. The optimistic take on that: Those that do overcome some of the daunting challenges will likely have an enormous edge on the competition—once we plug those leaks.
Global forklift sales have slumped in 2024, falling short of initial forecasts as a result of the struggling economy in Europe and the slow release of project funding in the U.S., a report from market analyst firm Interact Analysis says.
In response, the London-based firm has reduced its shipment forecast for the year to rise just 0.3%, although it still predicts consistent growth of around 4-5% out to 2034.
The “bleak” figures come as the European economy has stagnated during the second half of 2024, with two of the leading industry sectors for forklifts - automotive and logistics – struggling. In addition, order backlogs from the pandemic have now been absorbed, so order volumes for the global forklift market will be slightly lower than shipment volumes over the next few years, Interact Analysis said.
On a more positive note, 3 million forklifts are forecast to be shipped per year by 2031 as enterprises are forced to reduce their dependence on manual labor. Interact Analysis has observed that major forklift OEMs are continuing with their long-term expansion plans, while other manufacturers that are affected by demand fluctuations are much more cautious with spending on automation projects.
At the same time, the forklift market is seeing a fundamental shift in power sources, with demand for Li-ion battery-powered forklifts showing a growth rate of over 10% while internal combustion engine (ICE) demand shrank by 1% and lead-acid battery-powered forklift fell 7%.
And according to Interact Analysis, those trends will continue, with the report predicting that ICE annual market demand will shrink over 20% from 670,000 units in 2024 to a projected 500,000 units by 2034. And by 2034, Interact Analysis predicts 81% of fully electric forklifts will be powered by li-ion batteries.
The reasons driving that shift include a move in Europe to cleaner alternatives to comply with environmental policies, and a swing in the primary customer base for forklifts from manufacturing to logistics and warehousing, due to the rise of e-commerce. Electric forklift demand is also growing in emerging markets, but for different reasons—labor costs are creating a growing need for automation in factories, especially in China, India, and Eastern Europe. And since lithium-ion battery production is primarily based in Asia, the average cost of equipping forklifts with li-ion batteries is much lower than the rest of the world.
Companies in every sector are converting assets from fossil fuel to electric power in their push to reach net-zero energy targets and to reduce costs along the way, but to truly accelerate those efforts, they also need to improve electric energy efficiency, according to a study from technology consulting firm ABI Research.
In fact, boosting that efficiency could contribute fully 25% of the emissions reductions needed to reach net zero. And the pursuit of that goal will drive aggregated global investments in energy efficiency technologies to grow from $106 Billion in 2024 to $153 Billion in 2030, ABI said today in a report titled “The Role of Energy Efficiency in Reaching Net Zero Targets for Enterprises and Industries.”
ABI’s report divided the range of energy-efficiency-enhancing technologies and equipment into three industrial categories:
Commercial Buildings – Network Lighting Control (NLC) and occupancy sensing for automated lighting and heating; Artificial Intelligence (AI)-based energy management; heat-pumps and energy-efficient HVAC equipment; insulation technologies
Manufacturing Plants – Energy digital twins, factory automation, manufacturing process design and optimization software (PLM, MES, simulation); Electric Arc Furnaces (EAFs); energy efficient electric motors (compressors, fans, pumps)
“Both the International Energy Agency (IEA) and the United Nations Climate Change Conference (COP) continue to insist on the importance of energy efficiency,” Dominique Bonte, VP of End Markets and Verticals at ABI Research, said in a release. “At COP 29 in Dubai, it was agreed to commit to collectively double the global average annual rate of energy efficiency improvements from around 2% to over 4% every year until 2030, following recommendations from the IEA. This complements the EU’s Energy Efficiency First (EE1) Framework and the U.S. 2022 Inflation Reduction Act in which US$86 billion was earmarked for energy efficiency actions.”
Many AI deployments are getting stuck in the planning stages due to a lack of AI skills, governance issues, and insufficient resources, leading 61% of global businesses to scale back their AI investments, according to a study from the analytics and AI provider Qlik.
Philadelphia-based Qlik found a disconnect in the market where 88% of senior decision makers say they feel AI is absolutely essential or very important to achieving success. Despite that support, multiple factors are slowing down or totally blocking those AI projects: a lack of skills to develop AI [23%] or to roll out AI once it’s developed [22%], data governance challenges [23%], budget constraints [21%], and a lack of trusted data for AI to work with [21%].
The numbers come from a survey of 4,200 C-Suite executives and AI decision makers, revealing what is hindering AI progress globally and how to overcome these barriers.
Respondents also said that many stakeholders lack trust in AI technology generally, which holds those projects back. Over a third [37%] of AI decision makers say their senior managers lack trust in AI, 42% feel less senior employees don’t trust the technology., and a fifth [21%] believe their customers don’t trust AI either.
“Business leaders know the value of AI, but they face a multitude of barriers that prevent them from moving from proof of concept to value creating deployment of the technology,” James Fisher, Chief Strategy Officer at Qlik, said in a release. “The first step to creating an AI strategy is to identify a clear use case, with defined goals and measures of success, and use this to identify the skills, resources and data needed to support it at scale. In doing so you start to build trust and win management buy-in to help you succeed.”
Many chief supply chain officers (CSCOs) are focused on reorganizing their supply chains in today’s business climate—but as they do so, they should be careful to avoid common pitfalls that can derail their efforts.
That’s according to recent research from Gartner that identifies critical organizational design mistakes that will prevent supply chain leaders from delivering on business goals.
“Supply chain reorganization is high up on CSCOs’ agendas, yet many are unclear about how organization design outcomes link to business goals,” according to Alan O'Keeffe, senior director analyst in Gartner’s Supply Chain practice.
The research revealed that the most successful projects radically redesign supply chain structure based on distinct organizational needs “while prioritizing balance, strength, and speed as key business objectives.”
“Our findings reveal that the leaders who achieved success took a more radical approach to redesigning their supply chain organizations, resulting in the ability to deliver on new and transformational operating models,” O’Keefe said in a statement announcing the findings.
The research was based on a series of interviews with supply chain leaders as well as data gathered from Gartner clients. It revealed that successful organizations assigned responsibilities to reporting lines in radically diverse ways, and that they focused on the unique characteristics of their business to design supply chain organizations that were tailored to meet their needs.
“The commonality between successful organizations is that their leaders intentionally prioritized the organizational goals of balance, strength and speed into their design process,” said O’Keeffe. “In doing so, they sidestepped the most common pitfalls in supply chain reorganization design.”
The three most common errors, according to Gartner, are:
Mistake 1: The “either/or” approach
Unbalanced organizational structures result in delays, gaps in performance, and confusion about responsibility. This often stems from a binary choice between centralized and decentralized models. Such an approach limits design possibilities and can lead to organizational power struggles, with teams feeling overwhelmed and misaligned.
Successful CSCOs recognize balance as a critical outcome. They employ both integration (combining activities under one team structure) and differentiation (empowering multiple units to conduct activities in unique ways). This granular approach ensures that decisions, expertise, and resources are allocated optimally to serve diverse customer needs while maintaining internally coherent operating models.
Mistake 2: Debilitating headcount reduction
Reducing headcount as a primary goal of reorganization can undermine long-term organizational capability. This approach often leads to a focus on short-term cost savings at the expense of losing critical talent and expertise, which are essential for driving future success.
Instead, CSCOs should focus on understanding what capabilities will make the organization strong in the short, medium, and long term. They should also prioritize the development and leveraging of people capabilities, social networks, and autonomy. This approach not only enhances organizational effectiveness but also ensures that the organization is ready to meet future challenges.
Mistake 3: The copy/paste approach
Copying organizational designs from other companies without considering enterprise-specific variations can slow decision-making and hinder organizational effectiveness. Each organization has unique characteristics that must be factored into its design.
CSCOs who successfully redesign their organizations make speed an explicit outcome by assigning and clarifying authority and expertise to remove elements that slow decision-making speed. This involves:
Designing structures that enable rapid response to customer needs;
Streamlining internal decision-making processes;
And differentiating between operational execution and transformation efforts.
The research for the report was based in part on qualitative interviews conducted between February and June 2024 with supply chain leaders from organizations that had undergone organizational redesign, according to Gartner. Insights were drawn from those who had successfully completed a radical reorganization, defined as a shift that enabled organizations to deliver on new activities and operating models that better met the needs of the business. The researchers also drew on more than 1,200 inquiries with clients conducted between July 2022 and June 2024 for the report.
Like seaports everywhere, California’s Port of Oakland has long been planning for the impacts of rising sea levels caused by climate change. After all, as King Canute of medieval legend proved, no one has the power to hold back the tides.
But in Oakland’s case, port leaders have been looking beyond the hard-edged urban breakwater structures normally used for calming waves and rising waters. Instead, for the past five years, the port has been testing an artificial “island” that it describes as a prototype for an “ecologically productive” floating breakwater.
Known as the Buoyant Ecologies Float Lab—or “Float Lab” for short—the island measures 10 by 15 feet and consists of a fiber-reinforced polymer structure. Float Lab arrived in Oakland in August 2019 and was installed in the port’s shallow water habitat adjacent to Middle Harbor Shoreline Park.
Float Lab has now been moved from the Port of Oakland to the San Francisco Bay, where it will be anchored near Treasure Island, which is appropriately enough an artificial island itself. There, it will continue to host research efforts as ports keep a watchful eye on the changing climate.