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Please help me to answer these questions from the case below. Many thanks 8-44. What can companies do to make sure they are less vulnerable
Please help me to answer these questions from the case below. Many thanks
8-44. What can companies do to make sure they are less vulnerable to supply chain disruptions?
8-45. What do you see as the greatest event currently (as of reading this chapter, excluding Covid -19 ) disrupting supply chains? Why
CASE 1 | Supply Chain Havoc Information systems have assisted in the cre- ation of global supply networks that allow for the worldwide procurement of raw mate- rials and components needed as inputs into production processes. For the purpose of achieving an optimal balance between qual- ity and costs, manufacturers often have had to rely on complicated and fragile supply chains. Imagine that you are the manufac- turer of a trendy new gadget that is gaining popularity worldwide. Also imagine that a tsunami just rolled over the factory of a key manufacturer of a certain critical component in your device. At best, you may encounter long shipment delays and lost sales; at worst, your opportunity in the marketplace fades and you go out of business. Thus, shielding the delicate supply chain from negative impacts arising from external events is a tre- mendous challenge for many organizations, especially in a reality where disruptions can rarely be forecast and the results can be devastating. There are a variety of events that can put a supply chain in havoc. In addition to extreme weather events, other events such as cargo crime and terrorism can lead to disrup- tions. For instance, in 2015, the British Stan- dards Institute (B SI) estimated that global supply chains incurred a combined US$56 billion in extra costs from these and other factors. While it's not something most people think about, cargo crime is a signicant fac- tor inuencing the efciency and effective- ness of a global supply chain. The BSI estimated that US$23 billion were lost glob- ally due to cargo crime in 2015, reporting a 30 percent increase in truck theft in South Africa alone. Much of this theft was ruthless, \"with thieves using high levels of violence and switching from targeting only high-value goods to also targeting low-value items.\" In China, there were alarming increases in aggressive robbery from trucks traveling along major highways. In addition to increased violence, there was more sophis- tication in many of the attacks. In India, for example, criminal gangs found ways to remove the contents of large shipping con- tainers without breaking customs seals in order to avoid detection. Terrorism is also increasingly wreaking havoc on supply chains. In particular, in 2015, Europe suffered severe supply chain disruptions due to both terror attacks in France and Belgium and the inux of migrants into Europe to avoid the ghting in Syria and other parts of the Middle East. In the European Union, the socalled Schengen Agreement allows European citizens to cross borders without checks and greatly facili tates the movement of goods across Europe. After the terrorist attacks of 2015, many countries reestablished border controls, at least temporarily. It was estimated that per- manently reestablishing controls in Germany alone would cost its economy US$25 billion. Often highlighted for disrupting supply chains, natural disasters and extreme weather also were significant disrupters, resulting in more than US$33 billion in losses. In 2015, natural disasters disrupting supply chains included forest fires in Indonesia, earth quakes in Nepal, typhoons in China and the Philippines, and oods in the United States and India. Other incidents are even more unex- pected, such as the series of explosions in Tianjin (China) that killed more than 170 people and injured hundreds of others was highly disruptive. The blasts began on August 12, 2015, at the buSy Port of Tianjin, the largest port in Northern China and the main maritime gateway to Beijing. Annu- ally, this port handles more than 500 million tons of cargo and more than 13 million con tainers, making it the largest manmade port in mainland China and one of the largest in the world. The first blast was caused by an Overheated container of dry nitrocellulose. The second was far larger and involved the detonation of about 800 tons of ammonium nitrate. The res caused by the initial explo sions burned uncontrolled for days, causing many secondary explosions. Ultimately, the BSI report estimated the supply chain losses to be US$33 billion. Lastly, social unrest in many developing countries led to additional supply chain losses. Factory strikes in China in 2015, for example, increased by nearly 60 percent over the prior year. Other threats that might play a role in future disruptions include infectious diseases such as the Zika virus and Ebola. Concerns with climate change and El Nio may also result in increased extreme weather events. Clearly, many factors can create sup ply chain havoc. And because it is impossi ble to elude disruptions within today's global supply networks, organizations must care- fully plan for disasters because they simply cannot be avoidedStep by Step Solution
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