Penn experts reflect on the global supply chain snags that have stressed systems during the fall and holiday season.
“If you have an item come in in November, that order was placed last winter. And last winter, there was a ton of pandemic restructuring happening where companies didn’t see demand.
– Senthil Veeraraghavan, Professor of Operations, Information and Decisions, The Wharton School
Marshall Fisher, the UPS professor of operations, information, and decisions in the Wharton School, describes this fall’s supply chain crisis as “the mother of all supply chain disruptions.” But he also emphasizes one particular point that sometimes gets lost in the narrative: These disruptions are typical.
“COVID is not the first disaster to disrupt supply chains,” Fisher says.
The Kobe earthquakes in Japan in 1995, the Great Recession in 2008, and the earthquake and tsunami in Japan in 2011 are just some examples. Not to mention small disruptions that happen routinely, spanning factory fires to labor strikes.
Still, what is atypical of the crisis that’s led headlines for months is the scope of the crisis and the uncertainty surrounding it. This uncertainty is exacerbated by the globalized nature of today’s world economy—almost endlessly expanding the number of difficult-to-predict events—and a pandemic that refuses to heel.
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