If 2020 broke the supply chain, 2022 certainly wasn’t the year it got fixed. From a shortage of materials, labour and skill to disrupted logistics, many of the same challenges continue to plague supply chains. Pent-up demand is leading to blockages and global conflicts such as the war in Ukraine are pushing up prices, but this, some experts say, was inevitable.
After 30 years of trying to make the global supply chain as lean as possible, the case for savings, efficiencies and just-in-time strategies no longer stands up. “The global supply chain is too long,” says James Rickards, bestselling author of SOLD OUT: How broken supply chains, surging inflation and political instability will sink the global economy. “When you have that many moving parts, it breaks under its own weight.” All the plans put in place by supply chain managers served to cut down on inventory, time and effort but failed to take into account the hidden cost, says Rickards. “And the hidden cost was that you made this thing extremely fragile and frail, not resilient or robust.” 2023 is the year to try something new.