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Building smarter supply chains

June 4, 2020

W. P. Carey experts think big while supporting local businesses with their worldwide pipelines

Editor's note: This story originally appeared in the summer 2020 issue of ASU Thrive magazine. 

In mid-May, two months into social distancing and lockdowns, Arizona had yet to return to normal product availability. While supply chains have since loosened, some impacts may linger for a long time.

Even though the world has experienced supply chain disruptions from natural disasters and from other viruses in the past, COVID-19 is an “unprecedented global event” that has left many supply chains in limbo, said Mohan Gopalakrishnan, supply chain chair in the W. P. Carey School of Business at Arizona State University. It was also the first time many of us remember seeing bare shelves and stores entirely out of some food products and toilet paper.

“There are some really unique things about this pandemic,” Gopalakrishnan said. “Unlike Ebola, which was restricted to one area, this has quickly spread across the globe.”

Disrupting demand

Manufacturers and distributors have had to contend with sudden fluctuations in supply and demand. Supply chains are typically designed to meet either commercial or consumer demands — via different means — and they tend to trend in the same direction. In the pandemic, they’ve gone in opposite directions. As demands increased in the consumer market, demand dried up in the commercial market nearly overnight in mid-March as schools, restaurants, hotels and big facilities shut down. 

“Supply chains weren’t prepared to immediately shift gears, which left excess in commercial markets with shortages in the consumer area. It’s why you saw a lot of food being wasted and farmers being forced to dump milk,” Gopalakrishnan said. 

Yet there have been positive signs. Arizona’s prominence as a distribution hub continues to grow as consumers increase their online shopping. In addition, increased consumption of fruit to enhance immune systems has driven the demand for orange juice and benefited the state’s citrus industry. Retail sales of orange juice rose nearly 40% for the month ended March 2020, according to Nielsen data. 

“It’s having a big impact on Arizona’s citrus industry and futures,” Gopalakrishnan said. 

Packages waiting on a doorstep

Every package we order starts out as materials that become components, then manufactured goods that go on to delivery. The chain of events and connections has changed. Photo by iStock

Complex global markets

The complexity of the global supply chain, and China’s crucial role in it, has amplified the pandemic’s effects in some markets like electronics, food products and pharmaceuticals. While China contributed only 3% to global GDP in 2003, it now contributes up to 20%, Gopalakrishnan said.

One supply chain that constricted globally is personal protective equipment. Although production of N95 respirator masks typically averages 40 million per month in the United States, demand skyrocketed to 300 million per month during the pandemic, Gopalakrishnan said. The worldwide shortage led many countries to hang on to their own products, and as of late April, at least 80 counties limited the export of PPE, according to the World Trade Organization.

“That kind of nationalistic behavior further restricted the availability of essential gear,” Gopalakrishnan said. 

Many companies started to fill the void by adjusting their supply chains and manufacturing operations. Honeywell Aerospace partially repurposed its Phoenix manufacturing facility in late-March to produce N95 masks to supply the Strategic National Stockpile, a move the company said would create 500 new jobs. Local innovators, like ASU, created the ASU PPE Response Network to link health care providers with 3D printers, including all of ASU’s, in order to produce PPE gear locally close to where it will be used, and to distribute it quickly.

End users and companies also have been innovating to extend the life of products through refurbishing and cleaning. For instance, ASU created a way to sanitize 30 PPE masks in 5-10 minutes each. Thirty percent of ventilator capacity is now coming from refurbished and previously unused machines, Gopalakrishnan said. 

A new world

Gopalakrishnan will do further research this summer about how these companies have repurposed their supply chains, the impact it has had and what kind of structural changes we may see in the future to avoid supply chain disruptions.

Even as the world starts to reopen, Gopalakrishnan believes many countries will place a stronger focus on supply chain resiliency, something that could lead to “a battle of nationalism vs. globalism.”

“There is suddenly going to be a little step backwards in globalism. Some companies may want to source and (manufacture )closer to home,” Gopalakrishnan said.

MORE: Watch videos on building your supply chain resilience at news.wpcarey.asu.edu.

Written by Craig Guillot

Top photo: iStock

 
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Bringing back live entertainment

June 4, 2020

ASU Gammage executive director can't wait to bring guests back to shows — safely

Editor's note: This story originally appeared in the summer 2020 issue of ASU Thrive magazine. 

Written by Colleen Jennings-Roggensack, executive director of ASU Gammage and ASU vice president for Cultural Affairs. She previously served on the National Council on the Arts.

For an industry accustomed to the phrase “the show must go on,” closing the theaters was no easy task. But when ASU Gammage reopens, it will be grand. The theater is a place for people of all ages and backgrounds to come together and celebrate live art. No one can tell what the future holds, but there is one thing I am sure of: The theater is no place for fear. So, we will reopen when it is safe to do so. Social distancing is applicable in many scenarios, but it just won’t work in the theater. The backbone of this industry is the notion of people gathering to go on a journey and be transported to another world. That will not change, but some things might.

We are waiting on the edge of our seats until we can reopen, but we understand that certain precautionary measures must be taken to ensure people feel safe coming back to enjoy a show. We are discussing the different sanitary measures we can take — such as gloves worn by employees, stricter cleaning measures and monitoring the food and products entering the facility. These measures are not only to protect guests, but the performers, stagehands and employees.

We are all operating with one thing in mind: fluidity. This is a fluid time where protocols will change and we will be there to enact the changes that need to be made. We’re rewriting the script on procedures every single day. Whether it be spraying costumes with disinfectant or having people participate in temperature checks, we will adapt to the changes and be fluid in making decisions.

ASU Gammage is continuing to provide quality entertainment — now digitally. This adaptation exemplifies our commitment to serving our communities. We have hosted thought-provoking talks, inquisitive Q&As and incredible online performances all through Facebook Live. To name a few, Gus Farwell, former ASU quarterback and opera singer, gave us an incredible performance and insight on his life in Barcelona. We are engaging ASU students and our faculty through many digital programs such as DBR Lab with Daniel Bernard Roumain and ASU students. 

We have even had Arizona natives and current Broadway stars Krystina Alabado, Sam Primack and Casey Likes join us to share their wisdom, tips and tricks.

These online events allow us to share the work of local artists with community members in new ways. Artists are working over video calls and writers are thinking of pieces that would be appropriate over digital platforms. They are still enduring the creative process together, and ASU Gammage is doing just the same.

The format of shows is constantly being reimagined. I have talked to producers and creatives about ideas that they have brewing, and I can’t wait to see the final products. There will be shows inspired by this challenging time — some funny, some sad, some heartfelt — that will allow us to reflect. ASU Gammage has joined that conversation. From drive-in theatrical performances to music concerts in Sun Devil Stadium, nothing is off the table. All ideas are being considered.

We’re not part of the first phase of reopening, and that is OK. There is no “if” about reopening, but a matter of “when.”

We can’t wait until we can swing open the doors. Until then, we are working to stay safe and healthy for ourselves, our loved ones and our community. It is imperative to prioritize health and wellness — right now and every day. I know I speak for myself and our staff when I say we look forward to seeing many familiar and new faces at ASU Gammage.

MORE: Watch live online performances at ASU Gammage Digital Connections asugammage.com/digitalconnections.

Top photo by Tim Trumble/ASU