Covid has shaken the global economy over the past two years in ways it is hard, if not impossible, to grasp – at least while we are still in the thick of it.
Adam Tooze’s book Shutdown: how Covid shook the world’s economy has been described by the author John Lanchester in the London Review of Books (16 December 2021), “the best book about Covid from a global perspective”. And it shows how central bankers printed money to enable the economy to recover. Yes, the very existence of the internet has been a big help. But the big thing was, according to Tooze, the $14 trillion of stimulus the IMF estimates was injected into the global economy by January 2021.
While a “magic money tree” could not be found for John McDonnell’s modest proposal of free broadband for the masses in the December 2019 UK election, it could be found, after all, to save the world economy from the impact of Covid-19.
Tooze writes, in Shutdown (p. 97), that “the immediate impact of the coronavirus was to deliver a supply shock…. The pandemic was like technical progress in reverse”.
As I was reading the book recently, it brought to mind an interview I did in the fourth quarter of 2021, with Steve Miranda, executive vice president of Oracle Applications product development, about supply chain analytics.
I’ve been catching up with the thoughtful Miranda, once a quarter for a few years’ now.
The last time we did so was ahead of an Oracle event where the supplier was announcing some quarterly upgrades to its Fusion Applications Suite, with a concentration on its supply chain analytics service, ‘Oracle Fusion SCM Analytics’, to give it its formal name.
While Tooze is taking an Olympian view of the world economy, enterprise software suppliers (like Oracle, but not only they), have been seeing what’s been going on in their customer base globally.
And so, from my reporter’s notebook, here are some of Miranda’s comments, on 31 October:
I asked: Is the big picture here that the pandemic is still a governing factor with respect to supply chain disruption globally?
“It’s certainly shone a light on rapid change, and then adapting your systems to meet rapid change. Whether that is in supply chains or in the heavy recruiting of employees, or the heavy retraining of employees, it’s still around, and it has changed the dynamics of a lot of businesses, for the need for speed to react. And that’s where companies are either adopting or accelerating their adoption of our cloud applications to be able to react more nimbly today and going forward”.
(Of course, he would say that).
Miranda highlighted the supply chain analytics updates Oracle was making on top of its cloud-based Fusion applications suite at that time: “providing insights, and business intelligence on top of the supply chain manufacturing transactional app”. And he drew attention to the machine learning aspect as relevant to the time of Covid, in respect of managing supply chains: “giving recommendations. So, as we detect anomalies or opportunities in the data, it’s not just static a business intelligence system that is delivering information you ask for, but along with the information, explanations and recommendations for delivery”.
Does he see a radical change with respect to how big, international companies configure their supply chains, building in more resilience? He said he did, but “not always in the supply chain. [There are] supply chain examples. And that is a certainly not only with more resiliency in terms of sourcing from more locations, but also a deeper reliance on transportation planning, and order fulfilment. But also bear in mind, even in areas like HR, where companies are using our HCM system right now to quickly configure how to survey their employees to get vaccination status.
“Also a lot of our organisations are returning to work, which also implies employee surveys for retraining. And in hospitality, for example, where they really downsized or furloughed during the pandemic – they are now growing at unprecedented rates. And so that’s putting a strain on recruiting. Forget about the ‘great resignation’ issues, they are basically right sizing and ramping back up. So, I guess, yes to what you said, but I wouldn’t limit it to the supply chain”.
For sure, the impact of the pandemic on the economy globally will be with us for many years to come, and in 2022 there will be no shortage of supply chain and labour supply disruption issues for companies and organisations to deal with.
And for journalists and IT supplier user executives to talk about.