Top European Union (EU) officials released a plan Tuesday aimed at further unifying the 17 countries__and their economies__in the euro zone. This is one more story in the continuing euro saga that businesspeople all around the world are monitoring carefully.
According to the Wall Street Journal [subscription needed], leaders recommended that a single European authority oversee the territory’s banks and national budget deficits get prior approval by the rest of the euro zone countries. This last recommendation would be a major factor in the pooling of the zone’s debt.
Gabriele Steinhauser writes: “The report, commissioned by EU leaders at their last summit in May, is vague on many issues and silent on many other controversial questions. Yet it represents the most concrete official plan toward closer economic ties yet to emerge from the bloc.”
The recommendations were not meant as an answer to the current euro upheaval; but, instead, authorities suggested the measures be put in place over the next 10 years. “That leaves largely unchanged the current crisis strategy__an effort built around curbing government budgets and overhauling labor and product markets,” Steinhauser writes.
Many questions remain, and any agreement will be difficult and slow to come. Moving financial risk and oversight away from individual countries and to the euro zone means amending the EU treaty and national constitutions plus inevitable referendums in some countries.
Business leaders also remain cautious. According to a McKinsey Global survey, executives cite sovereign-debt defaults as the most common risk to global economic growth. Plus, these executives are twice as likely as they were in March to anticipate a euro zone recession in the next six months.
The world economy
Consider the definition of globalization from the APICS Operations Management Body of Knowledge Framework. “Globalization, understood from economic, financial, accounting, human resources, marketing, cultural, and other perspectives, has brought new challenges to operations management as corporations extend their supply chains beyond their national borders and deal with suppliers and customers around the world.”
It’s a simple definition, but the concept has myriad complexities and challenges. Chances are you and your company are dealing with reverberations from the euro zone debt crisis right now. For example, economic uncertainty brings with it stagnant demand and diminishing credit. This economic climate puts European suppliers at risk, creating uncertainty throughout the supply chain.
During the recession of 2008 and 2009, decision makers at many multinational corporations learned lessons that make companies stronger today. With the urgent situation in the euro zone and the tepid economic state elsewhere, are you best prepared to institute vital decisions regarding your organization’s supply chain and operations management? Are you taking opportunities to maximize your own career?
On its extensive website, APICS features valuable resources you can put to work today to help you make tough decisions or advance your career. APICS magazine, for example, features articles on optimizing inventory, building supplier relationships, and risk management. Also available on apics.org are career packs that contain job descriptions, career paths, and competency models by title for supply chain and operations management careers. These career-focused packages help you manage your career growth by strategically setting goals and measuring your progress against information provided by peers in similar positions across the globe. Even better, the career packs are free for ASCM Members.
Now is not the time to maintain the status quo in your company or your career.
Idea exchange
Now, you can take the APICS Operations Management Now discussion to your social networks on LinkedIn, Facebook, Twitter, and the APICS Supply Chain Channel. Be sure to use the hashtag #OMNow and include @Tweet_APICS in any tweets to have your words featured on the APICS homepage.
- In what ways is the European crisis affecting your company? Your supply chain partners? Your customers?
- According to the Journal, current EU crisis strategy consists of “curbing government budgets and overhauling labor and product markets.” What do you make of this strategy?
- What steps are you taking to maximize your company’s supply chain and operations management function? What resources are most valuable to you in this task?
In other news
Related APICS education
- Here or There?
By John P. Collins, CFPIM, CSCP, and Eric P. Jack, PhD, CFPIM, CSCP
May/June 2012, APICS magazine
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