Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Is It Time to Rethink Globalized Supply Chains?

sloanreview.mit.edu

Post reply on HN
Print view View original

121–130 of 322 posts

Re: Is It Time to Rethink Globalized Supply Chains?

#121

Post by bronipstid »

_jal wrote: post #76
rileymat2 wrote: post #54

Earlier quoted context omitted.

> I have always thought it was insane from a national security perspective to allow functionally all of key manufacturing capabilities (e.g., microprocessors) to go offshore. I am not sure, a completely dependent world may make us safer as wars will very hard to execute.

You might be right over the long term, we don't know yet. Related observations have been made - people used to talk about how countries with MacDonald's franchises never went to war. But it does open up avenues for conflict less intense than invasion. The term 'weaponized interdependence' has recently been coined for this. An exploration: http://henryfarrell.net/wp/wp-content/uploads/2018/05/Weapon...

Interesting. The McDonald's thing is sort of like saying that no two Soviet Socialist Republics have ever gone to war. It just means they aren't really sovereign independent countries acting on their own behalf.

Re: Is It Time to Rethink Globalized Supply Chains?

#122

Post by mc32 »

tvanantwerp wrote: post #36

I feel like the problem is less that supply chains are globalized, and more that they aren't redundant. By that I mean, there's too much reliance on China as the primary producer/exporter for countless industries and products. Having just one nation account for such a large share of manufacturing introduces single points of failure. It would be wise to have multiple sources for any given good, especially if it's esse…

Tim Cook is was hailed as a supply chain guru. But even he likely didn’t weigh pandemics high up on the concern list enough to have supply chain redundancy. For what appears to be a 1/100 year event I’m not sure it would make sense for most companies anyway.

Re: Is It Time to Rethink Globalized Supply Chains?

#123

Post by robofanatic »

tvanantwerp wrote: post #36

I feel like the problem is less that supply chains are globalized, and more that they aren't redundant. By that I mean, there's too much reliance on China as the primary producer/exporter for countless industries and products. Having just one nation account for such a large share of manufacturing introduces single points of failure. It would be wise to have multiple sources for any given good, especially if it's esse…

what about demand side of things?

Re: Is It Time to Rethink Globalized Supply Chains?

#124

Post by TeMPOraL »

ssivark wrote: post #29
jonrimmer wrote: post #19

The price advantages of globalised supply chains vs. the relative rarity of an event like this means that, during normal periods, firms using them will enjoy a significant advantage over those doing the "right" thing and market forces will weed out the latter. So I don't expect management to be taking a lead on this.

Well, the flip side is that during times of crisis, one would expect market forces to weed out the former kind of companies (leaner, and with globalized supply chains). So which ones survive, and which ones are out-competed are a consequence of which set of market forces we soften and which set we allow to play out.

And the edge of that coin is: once we're past this crisis, the same market forces that created this peril will start cutting the redundancies from the survivors, setting us up for the next crisis couple decades down the line.

Re: Is It Time to Rethink Globalized Supply Chains?

#126

Post by j-c-hewitt »

alexose wrote: post #64
tvanantwerp wrote: post #36

I feel like the problem is less that supply chains are globalized, and more that they aren't redundant. By that I mean, there's too much reliance on China as the primary producer/exporter for countless industries and products. Having just one nation account for such a large share of manufacturing introduces single points of failure. It would be wise to have multiple sources for any given good, especially if it's esse…

In my experience, it's not that companies are choosing any one strategy over another. It's more that companies have no idea what their supply chain actually looks like. Only that the widgets show up at their loading dock every week, and that the shipments have always been reliable in the past, so that there's no reason to look any further. There are often strong disincentives, as well. Nike, for example, got themselv…

There are regulatory and IP issues to consider as well. Redundancy is not necessarily as straightforward as it seems.

Re: Is It Time to Rethink Globalized Supply Chains?

#127

Post by robk »

jcims wrote: post #88
alexose wrote: post #64

Earlier quoted context omitted.

In my experience, it's not that companies are choosing any one strategy over another. It's more that companies have no idea what their supply chain actually looks like. Only that the widgets show up at their loading dock every week, and that the shipments have always been reliable in the past, so that there's no reason to look any further. There are often strong disincentives, as well. Nike, for example, got themselv…

This is it 100%. I work at a major financial institution and we invest ridiculous amounts of money, effort and, frankly, delay, in understanding our supply chain, its security posture and risk management model. It's a unbelievably gargantuan effort and if it weren't for the scary shit that we find all the time one could easily argue it's a waste.

What have you found? (Omitting any details that would be confidential of course)

Re: Is It Time to Rethink Globalized Supply Chains?

#128

Post by dv_dt »

jobu wrote: post #110
jonrimmer wrote: post #19

The price advantages of globalised supply chains vs. the relative rarity of an event like this means that, during normal periods, firms using them will enjoy a significant advantage over those doing the "right" thing and market forces will weed out the latter. So I don't expect management to be taking a lead on this.

Yeah, not only is this a once in 100years event, it's also staggered in such a way that the Chinese manufacturing will likely be caught up by the time the European and North American economies are coming back to life.

SARS in 2003 and H1N1 in 2011(?) - in the age of increasing globalization and population it seems like odds of this are increasing, we have skirted and now had pandemics more than 1 in 100 years.

Re: Is It Time to Rethink Globalized Supply Chains?

#130

Post by bronipstid »

throwaway2048 wrote: post #61
rileymat2 wrote: post #54

Earlier quoted context omitted.

> I have always thought it was insane from a national security perspective to allow functionally all of key manufacturing capabilities (e.g., microprocessors) to go offshore. I am not sure, a completely dependent world may make us safer as wars will very hard to execute.

https://en.wikipedia.org/wiki/The_Great_Illusion Interdependence, even to the point that war is utterly ruinous with no upside, is no guarantee war wont happen, don't make the mistake most people in Europe did before WWI

Wow, published in 1909. Amazing how old (and wrong) this "economic mutually assured destruction" argument is.

I think it's popular today as a distraction from the fact that the American Empire is really held together by military occupations in Europe, Asia, the Middle East, Latin America etc. and not economic ties. Obviously "we just want to make you rich" is much nicer sounding than "we will bomb you if you resist US hegemony".

Post reply on HN