Issue Overview

Supply chains today are extensively globalized thanks to the increasing efficiency of transport and logistics, the globalization of manufacturing and consumption as well as large investments in new infrastructure in emerging markets. Forecasts indicate that global trade will continue to increase and, as a result, gateway regions will increase in number and size. While trade is high on the global agenda, the logistics industry, which is critical to the expansion of global trade, has largely been overlooked.

For most people, logistics is an invisible service taken for granted. Consider all the products available in any supermarket: thousands of separate supply chains converge to give consumers the level of product availability they have come to expect. 

Logistics and supply chains are essential to any company’s competitive strategy and indeed its very survival. In the 21st century, logistics touches every aspect of every organization’s daily operations.

With trade facilitation, risk management, sustainability and job creation on top of the global agenda, logistics and supply chain can play a key role in economic growth, particularly for developing nations.

Yet, for now, logistics gets news coverage only when supply chain networks are disrupted by bad weather, industrial disputes, pirates, earthquakes, terrorism or even volcanoes. Journalists often speak of “logistical nightmares”, instilling a negative perception of the industry in the public mind.  

The logistics and supply chain industry is trying to change this perception and raise the public profile of the industry to make people realize just how vital it is to modern life.

Did You Know?

• From 2002 to 2008, global trade grew at a roughly linear rate of US$ 1 trillion annually.
• Wireless adoption is growing by 30% every year among supply chain businesses worldwide.
• 90% of global trade flows through 39 bottleneck regions.

Quotes

“While International cooperation to improve the operation of supply chains matters, there is much that national governments can and should do to improve the logistics environment in their countries.”
Bernard Hoekman, International Trade Branch, World Bank

“The logistics and supply chain sector underpins the entire global economy.”
John Manners-Bell, Editor and Chief Executive Officer, Transport Intelligence 

“Free trade makes an economy better, makes it stronger, and educates its people. It also allows goods to transfer around the world.”
Daniel J. Brutto, President, UPS International

Further resources

Outlook on the Logistics & Supply Chain Industry 2012
Logistics and Supply Chain Industry Agenda Council, Final Report, 2010-2011
The Global Enabling Trade Report 2012

Calendar

Council of Supply Chain Management Professionals Annual Global Conference
30 September – 3 October 2012
Atlanta, USA 

World Economic Forum Annual Meeting 2013
23-27 January
Davos-Klosters, Switzerland 

Council Insights

Since its inception in 2010, the Council on Logistics & Supply Chain Systems has focused its efforts on trade facilitation, the management of supply chain risks, supply chain decarbonization and bridging the skills gap in the logistics and supply chain industry.  

During each term, the Council has taken a deep dive into one of the above-mentioned issues. In 2010-11, the Council focused its efforts on supply chain risk, leading to the creation of the World Economic Forum’s Supply Chain and Transport Risk Initiative. This initiative resulted in a useful collaboration with the Forum’s Catastrophic Risk and Disaster Management Councils, its Risk Response Network and Accenture. During the 2011-12 term, the Council prioritized the role of logistics in trade facilitation. 

Over the past term, the Council has delivered significant results by introducing important supply chain issues such as risk onto the global agenda. It has developed an action-oriented initiative called "Enabling Trade – Valuing Growth Opportunities". In addition to publishing articles in trade journals, the Forum blog and elsewhere, the Council has provided insights to the Forum’s Logistics & Transport Industry Partners, with the Council Chair presenting its insights and recommendations to chief executives at the Governors Meeting for the industry at the World Economic Forum Annual Meeting in Davos-Klosters. 

This term, the Council will take forward its work on enabling trade and examine larger multistakeholder issues. The Council is considering developments likely to have a long-term impact, such as 3D printing, as well as near-term trade inefficiencies. 

The Council will continue to focus on issues including:

• “farm-to-fork” supply chains
• climate change adaptation
• logistics for megacities of the future
• big data
• practical advice to a developing country on how to best improve its logistics performance 

Contact Information

Research Analyst: Tiffany Misrahi, Senior Associate, Global Agenda Councils, tiffany.misrahi@weforum.org 
Council Manager: Ronald Philip, Associate Director, Logistics and Supply Chain Industries, ronald.philip@weforum.org 
Forum Lead: John Moavenzadeh, Senior Director, Head of Mobility Industries, john.moavenzadeh@weforum.org