Adeleke: Geopolitics, Climate Change, Rise Of Extremism Should Form Baseline for Supply Chain Risk Management

Adebayo Adeleke is a seasoned supply chain professional with expertise in risk management, security, geopolitics and indigenous supply chain, and trade. He is also a seasoned combat veteran of the United States Army with 20 years of service. His hands-on security experience has helped him provide data and insights on security challenges in Africa. His policy briefs on supply chain, security, and other resources have been featured in London Business School, the African Report, and others.

His desire to tell the story of African supply chains to the world and provide supply chain intelligence for stakeholders to make informed decisions concerning trade and supply chain in the continent led him to start Supply Chain Africa (SCA) -the supply chain data bank for Africa.

In this interview with Oluchi Chibuzor, he emphasized that geopolitics, climate change, misinformation, and the rise of extremism should form the baseline for supply chain risk management for stakeholders in the industry and also as a medium of data collection for effective business management and policy formulation.

The global supply chain has been challenged by the war in Ukraine, with events in the Red Sea increasingly becoming intense. Do Nigerian consumers have anything to worry about?

Yes they do. The global supply chain has been affected by the conflict in Ukraine and Russia, the blockade in the Black Sea and the rerouting and reduction of many key ingredients and fertilizer production. All these affect agricultural-based economies. Although Nigeria is an oil-based economy, we are also affected. The Red Sea is a strategic route because of vital canals like the Suez Canal through which a huge percentage of global trade goes through. Historically, for you to have a blockade like that, you need a large navy, and the navy is quite expensive. But they’ve used asymmetric warfare to disrupt and achieve that blockade.

The Red Sea is a strategic route because of vital canals like the Suez Canal, through which a significant percentage of global trade goes. Historically, for you to have a blockade like that, you need a large navy, and the navy is quite expensive. But they’ve used asymmetric warfare to disrupt and achieve that blockade.

We are experiencing interesting times in the global supply chain, and Nigeria is not immune to it. Although Nigeria is located in the Gulf of Guinea, anything from the Middle East, depending on which country it’s coming from, will affect the Nigerian market. Because the global supply chain is connected, the prices of containers and traffic have also increased. We need to put our eye on external geopolitical trends.

How will the freedom of navigation threaten the supply chain, and what are the mitigation measures that Nigeria should be able to put in place?

For the longest time, freedom of movement on the sea has enabled globalization. If hindered, it impacts the cost of importation, cost of goods, agricultural products, and food. Now that freedom of navigation has been threatened, other factions may want to replicate what the Houthis are doing. Nigeria should continue to enhance the freedom of movement on its internal waters, coastal waters, and coastal line. We should also join other countries to put pressure on all the threats in the open waters.

2023 was a difficult year with extreme weather events such as rising sea levels and natural disasters that have introduced new supply chain challenges such as disruption of transportation routes, infrastructure damage, and impact on production facilities, causing delays and interruptions in the flow of goods. What is a key lesson to learn from the extreme weather?

We have always had extreme weather challenges. Adverse weather is encoded in our evolving as human beings. For example, the rise in tides of the Nile helped Egypt irrigate part of the desert. With the advent of climate change, things have gotten worse.

A supply chain professional must consider this as the baseline of supply chain risk management. Global supply chain analysts must now include geopolitics, climate change, misinformation, and the rise of extremism in the global risk assessment.Data collection and assessments to make predictions are now crucial. This is how you’d know when and how to move your goods and services. We must continually lean forward and understand that although you can’t fight the weather, you can gather data to make proactive decisions.

The Nigerian supply chain sector seems to be playing the catch-up syndrome across the sector. So what is the outlook of the industry?

The Nigerian supply chain is unique because we have a lot to contend with. We have to deal with global issues, fluctuations in foreign exchange, the movement of goods and services, governmental policies, and high inflation. Still, there is a lot of potential in the Nigerian supply chain and logistical procurement area. With the movement of people to the urban areas, there is an opportunity for warehousing and distribution.
The distribution network within the country should be re-evaluated to facilitate trade and enhance the supply chain. For Nigeria to achieve this economic potential, the supply chain industry has to rise to the challenge.

As an expert in the supply chain sector, what emerging trend should major players be looking out for?

That’s a great question. The Nigerian population provides an opportunity to look into the housing market and everything that contributes to it. Food production needs to be addressed as well. These areas will boost Nigerian economic output, the supply chain, and logistics sector. I know we use the word logistics loosely, but I am talking about warehousing and storage, which have plagued the Nigerian economy.

We should also look into shipping- inbound and outbound and although it’s expensive. Once we fix that, we can move to the transportation sector.

We have seen fast-evolving and rapidly changing customer needs. What is driving these changing needs of customers?

Covid changed how we predict demand because demand drives supply. The way we predict demand changed because of the erraticness we saw during the pandemic. The way we predict electric consumption changed. Residential areas that used to be low in electric consumption are now high during the day. Climate change, carbon footprint, and sustainability are changing our source of energy. These are the driving forces behind consumers’ needs and will continue like that for the foreseeable future.

Looking forward, how do we improve our supply chain across public and private sectors?

Collaboration. To improve our supply chain, the public and private sector have to collaborate. There’s a lot the private sector is doing that the public is not seeing, and there’s a lot that the public has to bring to the table, especially in the areas of infrastructural renovation, and laying down the plans for the private sector to develop.

The government has to lay out its development plan in the coming years, and the private sector can make development goals based on that. This is vital for any country’s economic growth.

Infrastructure limitations, bureaucratic hurdles, and security concerns are some of the factors disrupting the smooth flow of goods and services in the country. How can the economy cope with these factors along with its increasing population?

It’s difficult. My institutional knowledge will say that the economy cannot cope. Nigeria is struggling because of these challenges, and something must be done, if we want a viable economy that works for all.

A closer look at the industry shows that the lack of robust technology and information system trustability, route and visibility, efficient inventory management, and supply chain leads to inefficiency and operational bottlenecks. What technological advancement would you prefer to help the country?

Technological advancement is not the issue. Adaptability and acceptability of technology are the crux of the matter. We have to educate people about adopting these methods, so we can have better data collection to enhance our lives.

We can use the data collected to predict, analyze, project, and posture the economy and the supply chain in real life. Without adoption we can’t trace anything, and when they don’t adopt the technology, they sabotage it.