Supply Chain Resilience : Push and Pull in Catastrophes
abundant , except where there has been a problem with number 3 immediately below . So , “ debris clearance ”— where debris is understood to be either physical or functional or regulatory — has been seriously reinforced as a Supply Chain Resilience priority .
3 . At any point in time , capacity is essentially fixed
High-volume , high-velocity , decentralized demand and supply networks have resilient strategic capacity . Low-volume , low velocity capacity cannot be quickly increased . Where preexisting capacity fulfilled high-volume , high-velocity demand , networks have demonstrated significant adaptability to shifts and spikes in demand during the pandemic . The US freight market 11 has been amazingly agile . The grocery sector quickly increased gross volumes 12 flowing to consumers . But even in grocery , where there was less volume , less velocity , or higher concentration , resilience has been challenged . Pork production in the United States is highly concentrated . 13 As a result , disease-related disruption at just a few pork production nodes seriously impacted network capacity . Pre-pandemic production of most Personal Protective Equipment ( PPE ), such as gloves and masks , was a low-volume category ( compared to grocery volumes ) characterized by low velocity and high concentrations distant from the United States . As such , the capacity did not exist to fulfill exponential increases in demand . PPE production capacity is still insufficient . 14 15 Given the time and expense usually required to increase ( or replace ) capacity , a preexisting lack of capacity to fulfill current demand is more about strategic realism than strategic empowerment . But in any case , recognizing the scope and scale of the problem is essential to any effective strategy .
Pre-existing — surviving — capacity is a key consideration in all potentially catastrophic contexts . The pandemic persuasively demonstrates that production and processing capacity can be stubborn . “ Inelastic ” is the term used by Federal Reserve economists . 16 Where possible , producers have added shiftwork . Lower-demand products have been discontinued to increase throughput of higher demand products . The resulting absence of product variation is expected to persist for many grocery categories through calendar year 2020 and with some products well into the new year . When worker absence and facility closedowns impacted
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