Boosting resilience: Working with like-minded partners to orchestrate critical supply chains
Supply chain disruptions caused by the COVID-19 pandemic and other issues have compelled many governments and private-sector companies to reconsider their practices. It’s time to reorchestrate critical supply chains—and militaries are ideally situated to lead the way.
Supply chains are complex, interwoven ecosystems of suppliers, manufacturers, distributors, and consumers. Rather than small, neatly organized linear systems that are relatively easy to trace and understand, today’s supply chains are a mosaic of interdependent actors that requires complex and laborious analyses to figure out. This inability to easily illuminate every step can leave vulnerabilities hidden in the complexity. So when a disruption like a global pandemic hits, it can disturb the entire process. Add in the rising strategic competition between leading trade partners, and the need to rethink supply chains to reduce risk becomes increasingly clear.
To reconstruct supply chains in a more resilient manner requires not just focusing on cost and efficiency, but also balancing those concerns against risk. Rather than simply trying to reduce risk through national self-sufficiency, the solution lies in understanding which trading partners can work together to reduce risk without adding unacceptable financial cost. In this way, solving today’s supply chain problems may be less about reshoring than it is “friendshoring”—orchestrating solutions with close partners and allies.
Reorchestrating supply chains to enhance their resilience can mean managing a dizzying number of relationships, a challenging task for untested practices. Defence supply chains offer a great starting point. By their nature, they provide defence organizations with the unique ability to explore reorchestration without causing unintended disruption. This is because for many defence products, like nuclear-powered submarines, defence organizations are the only customer. Most defence organizations already possess the logistical programs, supply chain coordination, and shared interests needed for trusted trader relationships. Other organizations should take note and consider starting small, focusing on trust, and building commonality among curated trading partners that share the same strategic interests.
This paper explores the vital importance of supply chain illumination, risk assessment to identify vulnerabilities and resource choke points for critical products and services, and the need for reorchestration or friendshoring through the right trade vehicle—with military organizations well-positioned to serve as a guide.
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