What caused all the supply chain bottlenecks? • Hacker News Board

Re: What caused all the supply chain bottlenecks?

#11

Post by cmenge » Thu, Oct 28, 2021, 7:13 PM UTC

Hm, seems like a monocausal 'explanation' of a complex problem - or let's say a mere opinion with little background information.

Given the 'hundred year crisis', I think we have fared relatively well from a purely economic point of view... So, yes, some problems may exist but I think we have witnessed a surprisingly resilient system, given how optimized everything is and how unprecedented the issue is.

I don't know if a slight price increase in graphics cards is the key issue to worry about at this point.

Keeping tons of spare capacity is neither economical nor environmentally friendly. Also, it would probably only shift the problem elsewhere.

Re: What caused all the supply chain bottlenecks?

#12

Post by silent_cal » Thu, Oct 28, 2021, 7:14 PM UTC

numpad0 wrote: post #10

spookthesunset wrote: post #4

Or maybe attempting to shut down large swaths of world economy for an indefinite amount of time wasn’t such a good idea? In the timescale of months to years all business becomes “essential”. Sure shut it down for “just two weeks” but a year or more? What did people think would happen?

A lot of people alive and not dead

Sweden

Re: What caused all the supply chain bottlenecks?

#13

Post by wccrawford » Thu, Oct 28, 2021, 7:14 PM UTC

thedogeye wrote: post #7

Spivak wrote: post #3

While this answers the question of why we couldn't respond to the bottlenecks, I guess I'm still missing the piece of what caused them in the first place. Like sure, "this silly little global pandemic thing" but it's not really an enlightening answer without more detail as to what the pandemic caused that shocked the system.

People were locked down so they stopped spending money on services (hotels, restaurants, travel, massage, etc) and instead bought more goods. This happened at the same time governments printed trillions and pumped it into the hands of consumers and businesses. The result was a 20% surge in container volumes, which our supply chain infra just wasn't ready for.

As well as rolling labor blackouts as factories had to shut down (repeatedly) because people got sick and they couldn't risk everyone getting sick. And distribution centers. And retail. Etc etc.

Re: What caused all the supply chain bottlenecks?

#14

Post by jes » Thu, Oct 28, 2021, 7:14 PM UTC

Spivak wrote: post #3

While this answers the question of why we couldn't respond to the bottlenecks, I guess I'm still missing the piece of what caused them in the first place. Like sure, "this silly little global pandemic thing" but it's not really an enlightening answer without more detail as to what the pandemic caused that shocked the system.

Have you seen the YouTube video where a waterwheel [1] demonstrates predictable behavior under one set of conditions, but with a small change, the system moves into chaotic behavior?

I figure the supply chain is like that. Under certain conditions, JIT is fine. Given sufficient disruptions, the system descends into chaos. Note that we have humans in the loop, too, so expect non-linearities.

I could be wrong. Corrections are welcome.

[1] https://youtu.be/Lx8gMBJBlP8

Re: What caused all the supply chain bottlenecks?

#15

Post by Dumblydorr » Thu, Oct 28, 2021, 7:14 PM UTC

Is Twitter the best place for such analyses? They're stream of consciousness sentences and paragraphs, not cohesive narrative essays.

Re: What caused all the supply chain bottlenecks?

#16

Post by allturtles » Thu, Oct 28, 2021, 7:15 PM UTC

spookthesunset wrote: post #4

Or maybe attempting to shut down large swaths of world economy for an indefinite amount of time wasn’t such a good idea? In the timescale of months to years all business becomes “essential”. Sure shut it down for “just two weeks” but a year or more? What did people think would happen?

I really don't understand what you mean by this comment. The only swaths of the economy that I'm aware of that got shut down in the U.S. are things like bars, restaurants and movie theaters. These are not tightly connected to global supply chains, AFAIK, and if they were why would their shut down cause bottlenecks (it should lessen demand, not increase it)?

Re: What caused all the supply chain bottlenecks?

#17

Post by Mikeb85 » Thu, Oct 28, 2021, 7:16 PM UTC

Really? Forced shutdowns -> things not being made -> not enough things...

It's basic supply/demand. If demand stays the same but supply is interrupted, production needs to increase for the same amount of time just to satisfy the demand that went unfulfilled. If supply is interrupted and 'reopening' simply means going back to initial production, you'll always be playing catch up.

Re: What caused all the supply chain bottlenecks?

#18

Post by [deleted] » Thu, Oct 28, 2021, 7:16 PM UTC

Spivak wrote: post #3

While this answers the question of why we couldn't respond to the bottlenecks, I guess I'm still missing the piece of what caused them in the first place. Like sure, "this silly little global pandemic thing" but it's not really an enlightening answer without more detail as to what the pandemic caused that shocked the system.

[deleted]

Re: What caused all the supply chain bottlenecks?

#19

Post by flyinglizard » Thu, Oct 28, 2021, 7:16 PM UTC

That’s just finger waving. The main cause is the madness of the situation where a deadly global pandemic causes the money supply to increase across all sectors. If you were a manufacturer in March 2020, the only responsible thing was to reduce operations to the bare minimum.

Add lockdowns and changing, unpredictable consumption patterns (e.g buying more cars against all predictions because who wants public transport now?) and you get the perfect storm.

You could hold a years worth of inventory and you’d still have a problem.

Re: What caused all the supply chain bottlenecks?

#20

Post by nostrademons » Thu, Oct 28, 2021, 7:17 PM UTC

Spivak wrote: post #3

While this answers the question of why we couldn't respond to the bottlenecks, I guess I'm still missing the piece of what caused them in the first place. Like sure, "this silly little global pandemic thing" but it's not really an enlightening answer without more detail as to what the pandemic caused that shocked the system.

It was predicted by a lot of people with experience in supply chain management or business.

https://en.wikipedia.org/wiki/Bullwhip_effect

Basically - complex systems behave in complex ways. When you have a small shift in consumer demand, it gets amplified up the supply chain, such that you need potentially big shifts in the production of intermediate components. We had a big shift in consumer demand. The supply chain basically can't cope, and so we get chaotic behavior until consumer demand normalizes and revised sales forecasts get propagated up the supply chain.