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Is It Time to Rethink Globalized Supply Chains?

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Re: Is It Time to Rethink Globalized Supply Chains?

#171

Post by catalogia »

nxc18 wrote: post #68
hello_moto wrote: post #48

Earlier quoted context omitted.

There are reasons why US prefers to bail Boeing. US is always concerned about espionage and dependencies on other countries with respect to national interest. An example would be the whole Huawei+5G debacle. What if Boeing goes bankrupt and the only reliable plane makers are PRC companies (usually state-backed, even if it's not explicit)?

Boeing needs to be broken up. Parts critical to national security can be federalized. The rest can be restructured to restore competition to the market and eliminate the 'single point of failure'. Boeing's efforts to consolidate the entire US aerospace industry into one company have hurt our society. https://en.wikipedia.org/wiki/Category:Boeing_mergers_and_ac...

> Boeing needs to be broken up. Parts critical to national security can be federalized.

Where that division line might be isn't clear to me. For instance the 737 is both a civilian airliner and a military maritime patrol aircraft (as the P-8: https://en.wikipedia.org/wiki/Boeing_P-8_Poseidon)

Re: Is It Time to Rethink Globalized Supply Chains?

#172

Post by hinkley »

I think we're damned if we do or damned if we don't.

There's a philosophy on international politics that basically posits that countries that don't share get jealous neighbors. I forget the line but it's something to the effect of, "Either goods cross your borders or soldiers will".

Instead, as someone else suggested, it's supply chain optimization that's the problem. But when you have a company that's making 20% margins, an 8% gain in margins by running right at the ragged edge would be pretty damned tempting. And if your competitors do it and you don't?

I think at the end of the day we are all to blame a little bit. And I proposed in the first article of this sort that it might be a good idea if Congressional pork were more evenly distributed throughout infrastructure and logistics instead of being concentrated entirely in Defense.

Re: Is It Time to Rethink Globalized Supply Chains?

#173

Post by stormdennis »

wongarsu wrote: post #74
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…

We had the same problem back in 2011 when floods in Thailand wiped out almost all of the world's hard drive manufacturing capacity across all manufacturers. It took almost two years for prices per GB to fall back to pre-flood levels. Relying on only one country seemed as foolish then as it seems now, but we haven't learned the lesson yet.

Plus all these once a century storm and flood events seen to be happening more regularly in recent years.

Re: Is It Time to Rethink Globalized Supply Chains?

#174

Post by fermienrico »

ardy42 wrote: post #86
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.

> 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. That's correct. It's a market failure that needs to be remedied through law and regulation. Hyper-s…

Would you agree with Trump’s stance on reducing American reliance on Chinese manufactured goods? Trump has been doing that since his election.

Re: Is It Time to Rethink Globalized Supply Chains?

#175

Post by agumonkey »

s_dev wrote: post #89
bkeyes wrote: post #44

Earlier quoted context omitted.

Never heard of them. Their company setup is pretty impressive. However to say 'relies on absolutely no one else for its supply chain' is an extreme exaggeration and frankly impossible. They don't make the computers, fiber optics, switches, exchanges, or software that their web site requires to run. They don't own the fleet of trucks, boats, and planes required to get their product to their customers - or their raw ma…

>Never heard of them. We had an argument in a CS class once about what the most "pervasive technology" in the room was. We were examining claims that "computing would become so pervasive and ubiquitous that it would become invisible" like electricity and that zipper. The reason it won was because we could count more of them than any other piece of tech in the room. Every person had more than they thought -- often as…

and it may only be the beginning.. application class SoC can fit in a microusb plug.. I think some people hacked some arduino like chip in the wire itself (granted it was not as thin as a normal cable)

Re: Is It Time to Rethink Globalized Supply Chains?

#176

Post by _lqaf »

bronipstid wrote: post #121
_jal wrote: post #76

Earlier quoted context omitted.

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.

The saying was at least trying to claim something different. The claim was, more or less, that democracy/capitalism (people making this claim didn't distinguish them, mostly) brings peace through freedom and prosperity.

It was more a claim about Western European countries, which, propaganda aside, were not puppet-states of the US.

Cold-war era US puppet-states were different, and at the time mostly didn't tend to have Macdonald's, at least outside of a capitol. We were busy subverting their democracies, and civil unrest doesn't go well with Big Macs.

Re: Is It Time to Rethink Globalized Supply Chains?

#177

Post by jagger27 »

fermienrico wrote: post #174
ardy42 wrote: post #86

Earlier quoted context omitted.

> 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. That's correct. It's a market failure that needs to be remedied through law and regulation. Hyper-s…

Would you agree with Trump’s stance on reducing American reliance on Chinese manufactured goods? Trump has been doing that since his election.

Oh, is that what the tariffs are for?

Re: Is It Time to Rethink Globalized Supply Chains?

#178

Post by cgearhart »

asdfman123 wrote: post #149
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…

How do you build in redundancy, though? If China makes widgets for $0.13 a unit and the US makes widgets for $0.15 a unit, how do you incentivize people to buy some of them from China, and some of them from the US? It seems like the logic of free trade and specialization dictates it's mostly all-or-nothing. That's a genuine question, by the way. I'm curious.

Tariffs, subsidies, legal mandates, direct government spending (the US military frets about the industrial base and does a lot of this). Take your pick. Plenty of other solutions as well. They all have different costs and benefits, but it’s at least possible theoretically.

Re: Is It Time to Rethink Globalized Supply Chains?

#179

Post by hinkley »

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…

Before he was CEO, Tim Cook was handling logistics for Apple, wasn't he?

I haven't been at many companies where a customer paid us money specifically to build up capacity for them first. Most of the time I've had to ramp up, we had to pay for it out of investment dollars or scraped out of contracts specifically for deliverables. Even when we special-built a feature for a customer, we still had to find a way to generalize it for others to turn a profit on it, and that was out of pocket.

Apple has apparently paid a number of manufactures to get good at something in exchange for a short lockup period and a permanent discount on orders. Which I think is why when Intel tried to make their first direct Macbook competitor, it turned out their margins were razor thin compared to Apple's.

Re: Is It Time to Rethink Globalized Supply Chains?

#180

Post by [deleted] »

hinkley wrote: post #172

I think we're damned if we do or damned if we don't. There's a philosophy on international politics that basically posits that countries that don't share get jealous neighbors. I forget the line but it's something to the effect of, "Either goods cross your borders or soldiers will". Instead, as someone else suggested, it's supply chain optimization that's the problem. But when you have a company that's making 20% mar…

[deleted]
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