OM - Global Supply Chain in post pandemic world

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Questions and Answers

What major event exposed vulnerabilities in global supply chains?

U.S.-China trade war

Covid-19 pandemic (correct)

Brexit

European debt crisis

Which of the following highlighted weaknesses in global supply chains during the pandemic?

Increase in consumer spending

Technological advancements

Growth in e-commerce

Trade restrictions and shortages (correct)

What is one reason companies may increase domestic production post-pandemic?

To take advantage of globalization

To minimize production costs

To enhance global reach

To reduce reliance on risky sources (correct)

Why do companies continue to rely on low-cost global production?

Consumers demand low prices Signup and view all the answers

What is the challenge for companies wanting to make their supply chains more resilient?

Ensuring competitiveness Signup and view all the answers

What is a key step in uncovering hidden supply chain risks?

Mapping the full supply chain Signup and view all the answers

Which of these materials are critical for mRNA-based Covid-19 vaccines?

Nucleoside phosphoramidites Signup and view all the answers

Why do many companies not map their entire supply chains?

It's time-consuming and costly Signup and view all the answers

What does the 'China plus one' strategy aim to achieve?

Diversify production beyond China Signup and view all the answers

Why might companies consider regional production strategies?

To reduce lead times Signup and view all the answers

Which of the following is an example of a product category that may be easier to source outside of China?

Furniture and clothing Signup and view all the answers

Why might shifting production away from China be challenging for sophisticated products?

Limited alternative sources Signup and view all the answers

What logistical issue affects Southeast Asian countries compared to China?

Fewer marine liner services Signup and view all the answers

Why is it impractical for companies to completely cut out China from their supply chains?

China's deep supplier networks Signup and view all the answers

What are the potential downsides of holding safety stock?

Risk of obsolescence and tied-up cash Signup and view all the answers

What is one benefit of process innovations when moving production?

Opportunity for major process improvements Signup and view all the answers

Which technological advancement has made automation more attractive?

Reduced equipment costs Signup and view all the answers

How can continuous-flow manufacturing impact pharmaceutical supply chains?

By lowering dependency on imported APIs Signup and view all the answers

What is another term for additive manufacturing?

3D printing Signup and view all the answers

How might new technologies change the traditional strategy of economies of scale?

By allowing smaller, distributed factories Signup and view all the answers

What supply chain strategy did the Covid-19 pandemic force companies to rethink?

Offshoring labor-intensive work Signup and view all the answers

Why might companies reconsider SKU proliferation?

It complicates production switching Signup and view all the answers

How can diversification benefit supply chains?

By spreading risks across multiple sources Signup and view all the answers

What role does automation play in returning production to higher-cost countries?

It minimizes labor needs Signup and view all the answers

Why is holding intermediate inventory recommended?

To prepare for potential supply disruptions Signup and view all the answers

How can companies address the reliance on a single supplier for a crucial component?

By developing alternative suppliers Signup and view all the answers

Which of the following illustrates a 'regional production' strategy?

Producing goods close to their primary market Signup and view all the answers

What is one reason companies may relocate their supply chains?

To take advantage of cheaper labor markets Signup and view all the answers

Why is process flexibility important in supply chains?

To quickly switch production as needs change Signup and view all the answers

What risk does just-in-time inventory management pose in a global supply chain?

Vulnerability to supply disruptions Signup and view all the answers

Why is it important to assess alternate sources for high-risk components?

To ensure resilience against disruptions Signup and view all the answers

What can additive manufacturing help alleviate in supply chains?

Dependence on traditional suppliers Signup and view all the answers

How can companies reduce their dependency on lean inventories?

By holding additional safety stock Signup and view all the answers

What is one challenge of moving production from China to Southeast Asia?

Fewer direct shipping routes Signup and view all the answers

Why is it important for firms to maintain some presence in China despite supply chain risks?

China's extensive supplier networks Signup and view all the answers

Study Notes

Global Supply Chain Vulnerabilities

The Covid-19 pandemic exposed vulnerabilities in global supply chains.
Trade restrictions and shortages highlighted weaknesses in global supply chains.

Reshoring and Regionalization

Companies may increase domestic production to reduce reliance on risky sources.
Companies continue to rely on low-cost global production for higher profit margins and consumer demand for low prices.
Resilient supply chains require shortened supply chains.

Risk Assessment and Mapping

Mapping the full supply chain is key to uncovering hidden supply chain risks.
Many companies don't map their entire supply chain because it's time-consuming and costly.

The "China Plus One" Strategy

The "China plus one" strategy aims to diversify production beyond China.
Companies may consider regional production strategies to reduce lead times and handle regional crises more effectively.
Shifting production away from China for sophisticated products can be challenging due to limited alternative sources.

Logistical Challenges and Dependency

Southeast Asian countries offer alternative production locations but face limitations in marine liner services compared to China.
It is impractical for companies to completely cut out China from their supply chains due to China's deep supplier networks.

Inventory Management and Process Innovations

Holding safety stock can offer protection against disruptions but carries the risks of obsolescence and tied-up cash.
Process innovations during production relocation can lead to major process improvements.

Technological Advancements

Automation has become more attractive due to reduced equipment costs.
Continuous-flow manufacturing can bring about major improvements to pharmaceutical supply chains.
Additive manufacturing, also known as 3D printing, can enable smaller, distributed factories, changing traditional economies of scale.

Supply Chain Strategies

The Covid-19 pandemic forced companies to reconsider offshoring labor-intensive work and SKU proliferation.
Diversification can benefit supply chains by spreading risks across multiple sources.
Automation can help return production to higher-cost countries by minimizing labor needs.

Addressing Supply Chain Risks

Companies should address reliance on single suppliers by developing alternative sources.
Regional production involves producing goods close to their primary market.
Process flexibility is crucial for quick production adjustments based on changing needs.
Just-in-time inventory management poses vulnerability to supply disruptions.
Assessing alternate sources for high-risk components is key to resilience against disruptions.

Future of Supply Chains

Additive manufacturing can alleviate dependency on traditional suppliers.
Companies can reduce dependency on lean inventories by holding additional safety stock.
Despite supply chain risks, maintaining some presence in China is essential due to its extensive supplier networks.

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Description

This quiz explores the vulnerabilities exposed in global supply chains by the Covid-19 pandemic and discusses strategies such as reshoring and the 'China plus one' approach. It highlights the importance of risk assessment and mapping in creating resilient supply chains. Test your knowledge on how companies adapt to these challenges and the implications for global trade.