April 05, 2011 Written by Behzad Behdani
Every year a number of catastrophic events such as earthquake, flood and hurricanes take place around the world from which just a few are happening in major centers of trade and industry. However, those rare events in important areas help us to evaluate the vulnerability of our global supply chains to disruptions and our capabilities to cope with them. The Japan earthquake is one of those rare events. The impact of disaster on the operation of supply chains is discussed in this article in three steps: direct effect on local facilities, indirect effect on Japanese suppliers due to lack of infrastructures and finally the impact on global supply chains.
Considering the effect of this big event, it seems a good time to test our beliefs on how a supply chain must be designed and managed in the uncertain business environment; how the 90’s trends in managing supply chains such as “Lean Production”, “Global Outsourcing” and “Single Sourcing” make us more vulnerable to such risky events …
Consequently, the lessons learned from this event, hopefully, lead us to think again about what must be done before next big event in the supply chains.
Read here the complete article.