What is a supply chain crisis?
What is a supply chain crisis?
Sources:
A supply chain crisis refers to significant disruptions within the interconnected network of entities, businesses, resources, and technologies involved in producing and distributing goods or services. According to Shane Parrish's discussions, such disruptions can cause systemic oscillations, where a previously smooth-running system faces out-of-sync production and inventory issues, overproductions, and stockouts.
One primary cause discussed is external disruptions such as government lockdowns, which disorient the system, creating a cascading series of inefficiencies and challenges across the supply chain. In response, companies may need to adapt by either absorbing higher costs, such as paying premiums for faster and more efficient delivery methods, or by strategically modifying their operations to insulate themselves from further disruptions. This might involve taking time out of the supply chain, which reduces exposure to these oscillations, leading to better competitiveness and profitability by mitigating the impact of these chain disruptions 1.
Supply Chain Crisis
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