The baby formula shortage is deplorable. And it’s nice that the government is trying to figure out how to help get more product into the supply chain. And it’s good to rethink restrictions on imports and get them moving.
But let’s not forget the real cause of the problem. It’s the fact that Abbott Labs would not agree to implement process changes required to reopen the plant that was shut down by the FDA for failing to meet standards for production.
So this is a case when industry and business failed to look out for the welfare of babies.
They failed to monitor the production properly to prevent contamination. And then they argued about how to fix it rather than jumping in to do the job fast. Was he cost the reason?
There are some times when firms just have to step up, admit a problem, and fix it fast. That did not happen here.
We should be glaring at Abbott for failing to prevent this mess we have to fix for them.
And I’m sure there are many other cases in other fields, most not so inconvenient and harmful as a shortage of baby formula.
This article quotes Carl Bentzel, an FMC commissioner, who says that there is increased concentration of the ocean shipping business, from no carrier having more than 4%, to around 10 carriers, half of whom have 12-20% each.
Many supply chain participants have been calling for standardization of basic data surrounding a shipment, especially concerning its timing and needs as it moves through the system. There are no standards for this kind of data, and any attempt to compile it meets the challenge of disparate and constantly changing independent systems. And often, data for particular shipments is exchanged by emails.
It would be nice if the FMC would step in and develop a standard for data interchange. But different players have different concepts of what data is essential, according to the article. For instance, some partners want to know how long they have storage rights for a particular container, free of detention and demurrage charges. Others want to know whether a chassis is available, and where. Chassis shortages have hampered container moves in the LA/Long Beach area, despite a chassis pool; other ports have pools as well, but containers often ride out delays on a chassis if it’s believed the wait won’t be too long.
A standard would be nice, but often takes years to negotiate. The startup Dray Alliance, mentioned in the article, is trying to set a standard for some of this information with an online and app-based system. But not all the necessary data will be there, not for all the participants in the container-move supply chain. And it’s not clear truckers need one more app.
Standards for port call activities could provide a basis for a data exchange system for status, and could also provide motivation for a priority basis for specific containers.
There’s currently no message or signaling system allowing all the supply chain partners to move a given container to know the required speed of service. Partners can’t coordinate unless they know precisely which containers need to be moved when.
The standards for service steps in the port would make it easier to determine when a container was behind schedule and expediting was needed to meet the level of service guaranteed.
Of course, the standards proposed by DCSA need to be tried out by ports, and the system needs to be tweaked based on what they find. But it’s a good start.