[burnte]

It's poorly implemented JIT. People simplified Just In Time to mena "no inventory" and then when a disruption hit, it echoed up and down supply chains. JIT doesn't mean no inventory, it means managing inventory and your supply chain to ensure adequate iventory based on needs both current and forseen.

One car example, you should ensure you have 4 times as many tires available as you do cars, because an imbalance there becomes either a constraint (too few tires) or a waste (too many tires). But it's not JUST making those numbers match, you have to forecast, how many cars and I going to build, are my supplies for the cars ok, look at normal fluctuations, and then also look at potential supply chain FAILURES and plan for them. Maybe it's easy to get brake pads but the lead time on tires is 4 months. Well then, I don't need to stock as many brake pads in case of a disruption, but I should definitely have enough tires to carry me through a potential disruption (maybe not 4 months worth, maybe I stock 2 and slow down car production, or something).

All these companies kept their shelves bare, and when some companies slowed orders, they didn't stop to think that the manufacturers they bought from would look for other customers to take up capacity. They acted like TSMC would sit there by the phone waiting for some customer to come back. No, they're in the business of selling chips, not in the business of servicing DumbCorp. No one planned for what might happen if they stopped ordering parts, they just expected the capacity to be there.

I'm bringing 6 new sites online this year, and a 7th early in the new year. I just bought a bunch of network equipment for not just our existing sites, but the 7 to come. I looked at supply chain issues, and said to my CFO, this inventory is going to sit here for 6 months, but we get a larger quantity discount, and we'll get the new sites online faster and not worry about getting this equipment if we buy now. We COULD have saved that money now, but the advantages of having it when we need it is greater than having that money in the bank for 6 more months.

JIT means planning ahead, not just micromanaging inventory. Too many MBAs don't get that.

[runawaybottle]

Your description doesn’t sound too different (if at all) from the face mask/ventilator shortage at the start of the pandemic. We didn’t stock up, and everyone tried to JIT purchase the necessary equipment.

Maybe we all have something to learn from Doomsday preppers.

[burnte]

> Maybe we all have something to learn from Doomsday preppers.

A little, but really just implementing the Toyota Production System properly. You'll never be perfectly prepared for everything, but a lot of the mess over the past 18 months of supply chain problems could have been avoided. In my personal life, I am NOT a prepper, but the way I stock my house, I had no issues with toilet paper, meat, or other weird shortages. I look at what I have no, what I'll need adn when, and how things are going. I didn't look for TP when I was out, I looked for it a week or two ahead of time.

[Akronymus]

Didn't toyota pioneer the JIT system of logistics?

But as with most such systems, others only implemented it partially and thus in a way that in the end creates problems.

[imtringued]

They looked at it and thought: "They cut 90% of the costs. We can do one better and cut 100%!"

[Akronymus]

Which works until it doesn't. When it does they look at it as having improved what already exists (The toyota model) when it doesn't they blame the original one instead of their mangled implementation ("agile" anyone?)