New EIU and Sealed Air Joint Study Highlights Gaps Between Companies’ Resource Management and Long-term Realities of Resource Availability
- 70% of companies face labor-resource challenges—and that shortages of skilled labor are the most cited resource challenge of any kind across consumer goods, food & beverage, and healthcare and hospitality services companies
- Companies face natural or physical resource challenges slightly less often —but a majority of companies are facing shortages of at least two of the three types of resources studied
- 75% of survey respondents said resource challenges had caused a revenue decline in the last fiscal year
- A third of respondents say that climate change has made their resource challenges more difficult or expensive to manage but only 11% say it has increased the priority of managing those challenges
- A complementary index ranking industry monitoring of and planning for resource challenges highlights gaps in planning—for example, executives’ current focus on improving overall working conditions to address the skilled labor challenge may not be the most effective long-term approach given the shifting shares of skilled workers in various regions
CHARLOTTE, NC, November 15, 2016/3BL Media/ - A global report launched today (November 15) by The Economist Intelligence Unit (EIU), which was commissioned by Sealed Air, a packaging and hygiene solutions company, draws on a global survey and a complementary index, the Global Resource Management Index, that together explore perceptions and realities of labor, natural and physical resource challenges for the consumer goods, food & beverage, and healthcare and hospitality services industries.
The report, Global Resource Challenges: Risks and Opportunities for Strategic Management, explores ways in which companies’ near-term concerns can cast a shadow over their long-term needs, allowing companies to ignore growing resource issues that could cause real problems in the years to come or at best to manage those issues tactically without attention to long-term resource trends.
The report highlights areas in which companies face resource challenges but are not necessarily currently focused on the most important challenges or most effective tactics to address them. For example, only 14% of companies said that water availability had been a problem for them over the past two years, suggesting they are thinking of it on a case-by-case basis as crises arise. Yet the index shows that countries on every continent will face increased stress on their water supplies by 2020, and best-practice companies are addressing water challenges holistically across their value chains.
However, the report also shows a strong alignment between the reasons companies address resource challenges—most often to attract or retain good employees, to create a hard business benefit or to reduce a hard business cost—with the benefits they have achieved from addressing those challenges, most often greater efficiency, an improved reputation with customers and an improved reputation with current and future employees.
“75% of survey respondents said resource challenges had caused a revenue decline in the last fiscal year,” said Dr. Ronald Cotterman, Vice President, Sustainability at Sealed Air. “In addition to pinpointing key issues and the right tactics to resolve them, the research shows that companies are working to best address their resource challenges by collaborating along their value chain – with suppliers, employees and customers. However, companies are finding that collaborating more widely, with industry groups and NGOs, for example, can bring additional insights through an extra set of eyes” added Dr. Cotterman.
Josselyn Simpson, editor of the report, said “the survey and the index, taken together, can help executives understand not only the effectiveness of current tactics to address resource challenges but also how they will need to adjust tactics going forward. For example, companies today most often focus on improving working conditions to address labor shortages, but looking ahead more companies will likely be able to find the skilled workers they need through local training as the skilled workforce grows in countries like Brazil, Chile, Malaysia and Vietnam.”
Notes to editors
The Economist Intelligence Unit (EIU) conducted a survey of 800 business executives in the food and beverage, hospitality, healthcare, and consumer goods industries. Respondents are drawn equally from North America, Latin America, EMEA, high-income Asia-Pacific countries and emerging-market Asia-Pacific countries; 29% hold C-suite roles and the rest are senior vice presidents, directors or senior leaders. Thirty percent of the respondents are from organisations with more than US$500m in revenues.
To complement the survey findings the EIU developed the Global Resource Management (GRM) Index, which is a set of four unique, interrelated industry focused indices that examine what is being done to monitor resource use, plan for future challenges and commit to sustainability and intelligent resource use across 25 countries. The industries and countries in the GRM Index are the same as those included in the EIU survey, with the exception of Denmark and Luxembourg.
Each industry-focused index ranks the 25 countries according to their overall level of resource insight and management in three broad domains: natural resources, physical resources and labor resources (human capital). Each of the domains contains a set of indicators organised into four common categories: 1) Use of resources, 2) Resource capacity, 3) Commitment to sustainability and/or Sustainability initiatives and 4) Regulatory regime. The food and beverage, consumer goods and healthcare services industry indices have 39 individual indicators. There are 40 total indicators in the hospitality services index. The data included in the GRM Index are from reputable international sources as well as the EIU’s proprietary database and analyst estimations.
About Sealed Air
Sealed Air Corporation creates a world that feels, tastes and works better. In 2015, the Company generated revenue of approximately $7.0 billion by helping our customers achieve their sustainability goals in the face of today’s biggest social and environmental challenges. Our portfolio of widely recognized brands, including Cryovac® brand food packaging solutions, Bubble Wrap® brand cushioning and Diversey® cleaning and hygiene solutions, enables a safer and less wasteful food supply chain, protects valuable goods shipped around the world, and improves health through clean environments. Sealed Air has approximately 23,000 employees who serve customers in 169 countries. To learn more, visit www.sealedair.com.
About The Economist Intelligence Unit
The Economist Intelligence Unit is the world leader in global business intelligence. It is the business-to-business arm of The Economist Group, which publishes The Economist newspaper. The Economist Intelligence Unit helps executives make better decisions by providing timely, reliable and impartial analysis on worldwide market trends and business strategies. More information can be found at www.eiu.com or www.twitter.com/theeiu.
 The survey includes Denmark and Luxembourg. These countries were not included in the index analysis owing to the scope of work and the relative size of their populations.