A is for Agility in today’s VUCA world

Consumer demand


D'turn 13Jul12.pngPity the poor purchasing manager, who:

• Must keep inventories low as end-user demand remains slow, and the CFO remains very worried about the working capital risk
• Must keep inventories high, to minimise the risk of running short if supply problems develop and prices jump

Benzene (green line), as always, is the great example of what can happen. As the chart shows, prices began to fall in early March, as oil prices fell. But May’s plant problems pushed them back up. Since then they have been down again, then up, then down. And then up again.

These moves are not being driven by a recovery in demand. This, from all accounts, remains as weak as ever. They are supply-driven, where any problems are magnified in a thin market. Thus prices have risen 16% over the past 2 weeks, having previously fallen 11% in 3 weeks.

This is a good example of the VUCA world in which we now live. Volatility, Uncertainty, Complexity and Ambiguity dominate.

The only solution is for companies to develop their own VUCA in response – Vision, strategic Understanding, Clarity over implementation plans. And, especially if you are a purchasing manager, Agility in response to unforeseeable events.

Benchmark price movements since the IeC Downturn Monitor’s 29 April 2011 launch, with latest ICIS pricing comments, are below:

HDPE USA export (purple), down 28%. “Producers were making few offers and seeking a higher price for any material they were offering”
PTA China (red), down 26%. “Polyester makers offered price discounts during the week to encourage sales”
Naphtha Europe (brown), down 25%. “Market lengthened this week as a result of imports from other regions boosting stocks, and demand from the gasoline sector declining.”
Brent crude oil (blue), down 20%
S&P 500 Index (pink), down 1%
Benzene NWE (green), up 8%. “Ongoing tightness for July, gains on crude futures, as well as firmer prices in Asia and the US, have all helped put more upward pressure on the European benzene market “


Force majeures decline as operating rates slow


The good news is that the blog’s 6 monthly review of force majeures shows ...

Learn more

China's leaders mark time till power handover


How many more empty cities like Ordos does China really need? Are 64.5m empty ap...

Learn more
More posts
Plastics producers need to move to recycled feedstocks as Western refineries start to close

Plastics producers are now being squeezed from both ends of the value chain. Upstream, the growing d...

Smartphone sales decline highlights need to move to a more service-based business model

Global smartphone sales took a hit in Q3, disappointing those who had hoped the economy might be mov...

PlasticsEurope calls for mandatory 30% recycling target for packaging by 2030

The European plastics industry last week took the crucial first step in moving away from virgin plas...

Samsung stumbles in global smartphone market as Xiaomi overtakes Apple

Smartphone sales confirm that global markets are continuing to pivot to the New Normal world. Back i...

Brand-owners start to focus on renewable carbon

The original debate on plastics recycling owed its prominence to Ellen MacArthur, the yachtswoman wh...

“One size no longer fits all” as the global smartphone market breaks down into different segments

The pandemic was very good news for some companies, with demand for online activities rocketing. But...

Biden’s Earth Day Summit puts plastics recycling on the fast track

Plastics has long been the ‘odd one out’ in terms of recycling. Steel, aluminium, glass,...

Americans hunker down on spending as the pandemic’s impact continues

US stock markets have been hitting new records recently, as investors swoon over the idea that the $...


Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more


Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more