Happy February, TSTers!

Thanks for stopping by for another info-packed issue. This week, we’ve got a discussion about how companies can protect against some of the avoidable supply chain problems we’ve seen over the past several years, and a battle cry from the FTC against non-compete clauses. I’ve also got a wonderful roundup of all the great things I’ve been reading, watching, listening to, and thinking about.

Here we go!

Industry Highlights: Dodging the Gray Rhinos

In the supply chain world, there’s plenty of talk about reading the tea leaves—predicting the future to ensure stability. There’s also talk about how no one could have predicted the Covid pandemic that shut down the world or Russia’s invasion of Ukraine.

To be honest, that talk is simply wishful thinking. Microsoft co-founder Bill Gates and other infectious disease experts warned about the threat of a pandemic back in 2015. Russia has been angling to invade Ukraine since at least 2014 with their Crimea annexation. And with China continually reaffirming their threat to retake Taiwan, you don’t need a Ouija board to figure out where the next disruption is coming from.

Business writer Michele Wucker calls these types of events “gray rhinos”—they’re highly predictable and have significant impact on the bottom line, but companies neglect them until they attack.

Or, as a recent article in the Harvard Business Review puts it, they are “when, not if” events. And yet, many companies’ supply chains crumbled under the stress of these predictable circumstances.

In the wake of these supply chain challenges, companies are starting to look ahead to potential issues. While HBR points out that CEOs rarely prepare for problems that aren’t likely to occur during their tenures, building rhino-proof companies can actually provide tidy upside profits as well.

Resilience is the name of the game here. HBR suggests investing heavily in risk intelligence and strategic foresight, as well as simplifying product portfolios and de-risking supply chains.

One way companies are exploring these options is through the use of technology. Another HBR article says forward-thinking businesses are investing in AI, 3D printing, recognition technology, and other digital manufacturing solution that will help to solidify previously shaky supply chain and logistics operations.  

On the shipping front, The Wall Street Journal reports companies are exploring automated container handling, which would quicken the pace of cargo movement through ports. This would help to prevent some of the hairier issues we saw during the pandemic, like when as many as 109 container ships sat in a holding pattern outside the US’s largest port complex in Southern California for the majority of the year.

The bottom line is that companies shouldn’t wait until the next big heartbreak to get moving. There’s enough intel out there to start making plans to prepare for the future, and it’s clear the juice is worth the squeeze.

The Future of Work: Non-Compete Nonsense

Tell me what the following people have in common:

A gas station attendant

A chef in a specialty restaurant

A radio broadcaster

A truck driver

They were all bound by non-compete clauses at one point or another during their careers. 

I mentioned the growing trend of non-compete clauses a few months back, and since then, it’s become abundantly clear that they’re not just being impacting white collar workers. 

In fact, according to the Federal Trade Commission, about 30 million Americans—nearly one in five—are bound by non-competes. They’re being signed by security guards, retail clerks, and other types of blue collar, frontline workers who previously had the freedom to shop around in their industry to find the company that best fits their needs.

The practice has grown so much that last month, the FTC decided to step in, proposing a ban on non-competes. The commission documents claim non-competes lower wages and stifle entrepreneurship by stifling innovation that would result from workers broadly sharing their ideas. The ban could increase annual worker wages by nearly $300 billion, the proposal reads.

Not surprisingly, support for the ban falls fairly evenly along party lines. Democrats support the move, echoing the belief that it will increase wages and worker mobility.

Republicans, on the other hand, argue it will make companies less likely to train workers, thus putting the burden of training costs on the workers themselves by way of trade schools or additional certification requirements.

I can understand why professional organizations would want to protect their institutional investment in knowledge and training. Without that, they’d be dead in the water. But to prevent a gas station attendant from working the pumps at a station across the street that offers better pay and flexibility—as commentator Michael Smerconish mentioned recently on TikTok? That feels tacky to me.

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

📕 Read - The Good Life

What makes for a meaningful life? That’s the topic of the world’s longest-running study and a new book by Harvard professors Robert Waldinger and Marc Schulz. Called The Good Life: Lessons from the World’s Longest Scientific Study of Happiness, the book lays out insights from the revealing personal stories of the Harvard Study of Adult Development, which began in 1938 and has spanned four generations of participants. Spoiler alert: the study primarily shows that it’s not wealth or success that generates happiness—it’s meaningful relationships and connections with others.

📺 Watch - PMI and Jobs Report

I’ve been watching both the ISM PMI numbers and the recent BLS Jobs Report and am a little surprised at what I see. Considering all the buzz about how poor the job market is and watching layoffs occur across several different industries, it’s interesting to notice such a significant uptick in job creation since last month.The tech sector represents around 2% of the private sector workforce while 36% of the private sector workers comprise the healthcare, education, hospitality, etc. Yet all the the news oxygen goes to the former shedding jobs as opposed to the latter, adding 1.19 million jobs in the past six months. It’s like saying there are two leading experts on employment trends and they both disagree.

👂 Listen - The New World of Work

Adi Ignatious’s HBR podcast, The New World of Work is always a good listen, and a recent episode featuring ActOne Group CEO Janice Bryant Howroyd is no exception. Howroyd was the first African-American woman to launch a billion-dollar enterprise (disclaimer: since ActOne is privately held, Ignatious points out it’s not possible to verify that figure), and she cracked the top 40 list of Forbes’s most recent wealthiest self-made women in the US. She has great advice on using data in the global work environment, the importance of faith in her success, and how other women can follow the path that she’s blazed. Inspiring and informative—just the way I like it.

💡 Think - Turkey/Syria Earthquake

In light of the recent devastating earthquake on the Turkey/Syria border, it’s gut-wrenching to think that these natural disasters result in an unfathomable amount of mass suffering. While earthquakes are unequivocally caused by nature, their repercussions are typically felt by those communities unable to create the infrastructure needed to endure such events. Shoddy construction and a dearth of resources are what make these naturally occurring events a true tragedy. 

Bret Stephens, a sharp and articulate journalist I’ve been following since his days at The Wall Street Journal, authored a must-read in The New York Times on the harrowing experience he had living through an earthquake in Mexico, and then covering the aftermath of one in Pakistan. 

I urge you to consider donating to Humanity First’s Disaster Relief fund to help the victims of the Turkey/Syria earthquake. You can make a donation HERE or at https://ahbap.org/

Charts of the Week

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 at [email protected]!

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

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Happy reading this weekend!

-- Naseem