Hello dear readers!

I hope this finds you well and you’re headed into some well-deserved relaxation with friends and family over the holidays. My family and I will be visiting Chicago for the first time since we moved to Dallas in the summer, and we’re looking forward to reconnecting with many of you!

In this edition of The Supply Times, we’ll explore how California has lost its title as the king of shipping and dive into the Wall Street Journal’s list of the year’s best-managed companies.

I’ve also got some fun books and show recommendations for you to enjoy during the holidays, as well as a great look at 2022 in charts.

Thanks for being here and spending some time with me! Let’s go for it.

Industry Highlights: Go East, Youngling

Southern California has long been the king of shipping in the US, but due to increased snarls and drama, many companies have shifted their sights eastward.

A recent Wall Street Journal article reports that businesses in many industries are increasingly relying on Eastern and Southern ports as entry points for their goods in the hopes that it will save them time, money, and risk.

Ports in Los Angeles and Long Beach have dominated containerized cargo handling for decades, but due to extended bottlenecks and concerns about dockworker strikes, their tonnage has dropped to its lowest in 20 years.

Meanwhile, New York and New Jersey ports are handling more cargo than ever, taking over the top spot in August. Other ports benefiting from the shift include Savannah, Houston, and Charleston, S.C.

What seems like a new trend is actually a return to where shipping began. East Coast ports revolutionized sea-faring cargo transport in the 1950s, and it wasn’t until China became such a primary supplier that the West Coast was able to gain a toehold in the shipping industry.

As I wrote in the last issue, since many companies are attempting to ease their reliance on Chinese goods, the shift east makes sense. One such company is Abercrombie & Fitch, who has been sourcing more of their apparel from Indonesia and Bangladesh—countries which both have a more direct route to eastern ports via the Suez Canal.

Atlanta-based Newell, the company that makes Yankee Candles and Sharpie markers, has also increased inroads at eastern ports.

Sound advice, considering many companies have done that for far too long and are now seeing it affect their bottom line.

The Future of Work: Cream of the Crop

I love a good power ranking list, and since my beloved Washington Football Team (not on the Commander name train yet) hasn't cracked the top 10 in nearly three decades now, I’ve found solace in the ranking of companies.

Each year, The Wall Street Journal teams up with the Drucker Institute to compile the best managed companies of the year. The results are based on a holistic measure of “corporate effectiveness”—that is, companies that do the right things well.

The five primary areas of evaluation connected to customer satisfaction, employee engagement and development, innovation, social responsibility, and financial strength. Here’s a full breakdown of how the Drucker Institute arrives at their results.

No real surprise that Microsoft retained its top spot in the rankings for the second year in a row, but overall, the majority of tech companies that dominated last year’s rankings slipped significantly.

Meta (Facebook), Alphabet (Google), Uber, and Salesforce all dropped this year, which experts attributed to slowing revenue growth following a two-year boom spurred by the pandemic. Amazon remained in the top 10 (8th place), but recorded the biggest decline in overall score of any company in the top 250.

It was the auto industry that made the most overall gains this year, with General Motors climbing from 16 to 5 this year. Tesla and Ford also climbed the ranks, which Drucker researchers attributed to their high scores in social responsibility after devoting significant resources to electric vehicle development.

The list is always a celebration of the world’s best companies, but it came with a few red flags this year. Only seven firms scored a 60 or higher on the 0-100 scale in every category—what Drucker calls “the All-Stars.”

Notice Microsoft isn’t on that list because of a 48.6 score in customer satisfaction.

Look at the full Management Top 250 Report here.

IMAGE GOES HERE

The Supply Aside: What I’m Reading, Watching, Listening to, and Thinking About Re: Supply Chain, Work, and Beyond

📕 Read - Chip War and Trust

If you’ve been reading The Supply Times for any amount of time, you know how fascinated I am with the microchip wars occurring between the US and China. It’s not just a passing interest—I really do believe that a great deal hangs in the balance, and so does economic historian Chris Miller, who wrote a book about it. In Chip War: The Fight for the World’s Most Critical Technology, Miller explains how the semiconductor came to play a critical role in modern life, and how dangerous a game it is to rely on TSMC, located in an increasingly volatile geopolitical region, to provide all of the materials necessary to keep our country safe.

On the lighter side, another (fiction) book I recommend is Trust by Hernan Diaz. It’s a genre-bending, time-skipping novel that captivates the story of class war in the roaring 20s and Great Depression. The parallels to our current time are eerie—e.g. financial manipulation, excess, greed, and prosperity and how it impacted society at large. The historical fiction feel to it makes it an informative and appealing read.

📺 Watch - Tulsa King and Jack Ryan

The holidays are a good time to catch up on bingeworthy shows, and here are two great recommendations for you.

Don’t skip out on Tulsa King, a crime drama on Paramount Plus. Starring my man Sly Stallone and co-created by Taylor Sheridan (the mastermind behind Yellowstone), it’s the story of a washed up mob boss who’s exiled to Tulsa, Oklahoma after serving a 25-year sentence in a federal penitentiary. Stallone plays a great Wise Guy character, and the entertaining storyline and of course the action, keeps me engaged.

Also, being a huge Tom Clancy fan, I’m looking forward to Season 3 of Jack Ryan on Amazon Prime Video. Based on the previews, it looks like our hero Jack is going rogue this season while averting WW3. Just another day in the life of Jack. I can’t wait to see what he has in store for us. It’s a little formulaic, but I like it.

👂 Listen - Journey with Christian D. Evans Podcast

Christian Evans has a rule in life that he lives by: Be uncommon if you can. He brings that into his wonderful conversations with his guests, asking thoughtful questions to some of the most interesting people in the business world and beyond. I most recently enjoyed his episode with Tamara Steffens, the Managing Partner at Thompson Reuters Ventures. Tamara talks about her incredible career, which spans 20 years of experience driving growth and successful exits for early-stage consumer and enterprise startups.

Self-promotion alert: I just recently recorded my own episode with Christian, and it will be out soon. Stay tuned!

💡 Think - Looking Back, Looking Ahead

If we were expecting less volatility and more normalcy, that notion went out the window on February 24, 2022. From the Russian invasion to the energy crisis to the surging inflation, there was no shortage of upheaval in 2022. In addition, we saw heightened tensions in geopolitical rivalries thanks to semiconductors and TikTok. Finally, we observed some balancing out on the return to work debate, i.e., the pros and cons of being together and collaborating vs. attracting and retaining talent that wants remote only.

As to 2023, I'll watch keenly how interest rate hikes play into potential recessions worldwide. We'll probably have a softer landing in the US than our European friends. A slowing economy and continued headwinds threaten China's ambitions of global dominance. It's high time they finally eased up on their draconian Covid policies. Hopefully, they can soon find a way to live with the virus. You know, like the way the rest of the world does.

Have a recommendation for something I should read, watch, or listen to? Let me know here!

Charts of the Year

It’s the most wonderful time of the year for people like me who love data, because it’s when think tanks around the world release their years in review. One of my favorite reports comes from McKinsey, who compile some really interesting annual trends into fascinating infographics. I know McKinsey isn’t exactly at the top of Santa’s Nice List this year, but the firm knows how to synthesize data and crunch numbers.

Here are a few of my favorites from this year’s report:

And because I can’t NOT include the esteemed Professor Scott Galloway, here’s a good recent one from him on the incredible jump of business applications submitted last year:

Quote of the Week

Tweet of the Week

Finally...

Thanks so much for reading. I’d love to know what you think about this issue and how I can make it more useful to you.

If you have suggestions or topics you’re interested in seeing me address, shoot me an email here!

Want more?

If you’d like to read more of my writing on the supply chain, entrepreneurship, or the future of work, check out my website.

For timely updates follow me on LinkedIn and Twitter!

Happy reading this weekend!

-- Naseem