One of the things that have become painfully clear during the COVID-19 pandemic is that most people in elected office have no understanding of how supply chains work. Most people in the public have no sense of how supply chains work, and this is reflected within the political class.
In addition to all that has played out before our eyes during this devastating COVID-19 pandemic, we watched as a snowstorm brought the electric grid in Texas to a crippling halt during the third week of February.
Don’t believe those who insist that this is a “Black Swan” event. According to reporting by ProPublica and the Texas Tribune, there were two such events between 2011 and 2014. Thanks to lobbying efforts by the power companies, “Instead of identifying all possible failure points in their equipment, power companies would need only to address any that were previously known.” As a result, last month up to 4.5 million people went without power and potable water, in scenarios reminiscent of many developing countries.
Supply chains are the vast, interconnected, and intricate networks of people and organizations that enable the production and consumption of all types of goods and services across industries, across geographies. The power failures in Texas are so startling because modern supply chains run on electric power. When there’s a large-scale failure of the electric grid the supply chains we have come to rely on and take for granted grind to a screeching halt.
Supply chains are also how society harnesses the factors of production and converts them into actual products and services.
Texas is only one of several recent examples of what can happen when people in elected office do not fully understand the complexities and inter-dependencies of modern supply chains.
The European Union is still struggling to ignite its COVID-19 vaccination program largely because officials at the European Commission did not fully understand the implications of their decision-making process in the context of the pharmaceutical supply chains that are required to produce and distribute doses of the vaccine.
During conversations with members of our grassroots-driven communities, we have consistently heard impassioned descriptions of how the global container crisis is affecting large and small companies alike, all over the world. The crisis has put those jobs that have not already been lost to the pandemic at risk.
Conversations amongst members of our communities confirm reports that so far, Brexit has only made business and trade more difficult, not less. For a century-old chemical company that is now facing an existential crisis, Prime Minister Boris Johnson’s statement on Dec. 24, that Britain would now be free “to set our own standards, to innovate in the way that we want.” provides cold comfort.
The issues that affect supply chains at a societal level are governed to a large extent by the choices that are made by people we elect to represent us in political office. Often these people do not understand how the choices they make on our behalf affect the supply chains that we all rely on and too often take for granted.
One way to solve that problem is to require an annual training requirement that does two things: First, it would deliver a fundamentals of supply chain management course to every person that occupies an elected position – at every level of government. Second, once the training has been delivered these individuals would be tested to ensure that they meet a basic level of understanding of the most important concepts that the training intended to teach.
As the climate crisis unfolds, the world will have to grapple with more frequent disruptions to global supply chains resulting from extreme weather events. Combined with supply chain disruptions that arise from man-made causes, we are entering an age of increased supply chain risk.
It is time our politicians come to grips with the complexities of modern supply chains. It is time we demand that they demonstrate that they understand how our lives and our livelihoods depend on the choices they make and how those choices affect the supply chains on which modern society runs.
About the Author
Mr. Aoaeh is a co-founder of The Worldwide Supply Chain Federation, and a co-founder and general partner of REFASHIOND Ventures, a venture capital firm investing in early-stage supply chain technology startups. He is an adjunct professor of Supply Chain & Operations Management in the Department of Technology Management and Innovation at New York University’s Tandon School of Engineering