Supply Chain Discussion

[Traveler]

Recently I heard a political statement about supply chain that attempted to explain it as getting stuff from a point of origin to the desired destination (someone’s home).  Since there is false information, I thought that I would explain some of the critical issues for our supply chain woes.   I made my living as an expert in designing automation and robotics (including artificial intelligence) for companies’ supply chain (material operations and controls).

The first point I would make is there are two deliverables in the market place – we call these deliverables “Goods” and “Services”.  Most define or think of the supply chain as stated above – getting stuff from one place to another because they do not understand the importance of services and they think in terms of only the goods.

The next point I would make is that all products must initially be either grown or mined.  Both the process of growing and mining rely upon and utilize “natural resources”.    Part of understanding the supply chain is to understand the utilization of resources – which (surprise, surprise) includes conservation of natural resources.

The first problem of the supply chain is to secure raw natural resources.  The simple truth is that no civilization can continue as a civilization without control over all needed raw natural resources.  In addition a civilization (or company)  is also dependent on being able to control all the steps necessary to transform the raw natural resources to the final product which will include the transportation of the various resources to necessary places to prepare or refine the resources so that it can be used by the civilization.

There are a number of “elements” necessary to transform raw resources into final products.  Among the elements are specific skills that include: management, engineering, skilled labor, transportation and marketing (to name some of the most common necessary skills).   In a well ordered civilization (company) individuals become experts or cogs in the machine we call the supply chain to provide us with all the good and services that are not only necessary but also enjoyed. 

Like any complex machine there are many parts that must work not only smoothly to accomplish or provide the desired product but individual task must also operate together with other individual tasks efficiently and smoothly with all the other elements of the supply chain.  There is a saying that a chain is only as good (or strong) as it weakest link.  This is true with the supply chain and why the term “chain” in included in the very term.

I doubt than anyone reading this post has lived without the luxury of several products dependent on a supply chain that I help design and engineer so that you could have many products available at a cost within your budget. (This includes foods, toilet paper, automobiles commercial and military jets, computers and even robots among many other things)

The supply chain in the USA has been at risk for decades and what we are currently experiencing has been long in coming and completely avoidable except for deliberate steps made by both political parties as well as corporations.   The two problems I see most responsible for our current problems are:

Number ONE – Outsourcing expertise (yes this includes manufacturing)

Number TWO – Just in time inventory verses inventory warehousing storage.

I am not certain if there is interest on this forum – either with the causes of current failures or what is necessary to bring about possible solutions.   (Spoiler alert – neither party seem to understand what has gone wrong and both have contributed to the current failure.  And neither party seems to have much of a clue - Trump seemed to have the greatest grasp of supply chain issues and was hated for attempts to fix many obvious problems - especially by Democrats or I should say Democratic party leadership).  But for the record, Trump’s view of supply chain issues is completely from the corporate level rather than the consumer and individual worker level.  When I speak of the individual worker level I am referencing the kaizen meaning as applied to a group, society or company).

 

The Traveler

[Ironhold]

A very large part of our current problems is the dire shortage of skilled trades workers. 

For generations now, the mentality in the United States has been "college is for winners, trade school is for losers". 

There was a stigma attached to becoming a skilled trades worker, so much so that even in high schools kids were pushed towards college even when it should have been obvious that they would have been better suited in one of the skilled trades. As a result, these kids either failed out of higher education or didn't have the desire to go, hindering their entire lives. 

A very large part of why those ships are all stuck waiting to get into ports is because there aren't enough workers to handle them all once they dock. 

There aren't enough dock workers, crane operators, forklift operators, and others to actually offload those ships once they get to port. 

There aren't enough truck drivers, pilots, and train engineers to take the offloaded product and get them to where they need to go. 

There aren't enough mechanics and technicians to maintain those forklifts, trucks, trains, planes, cranes, and so on. 

Et cetra. 

Construction workers, plumbers, electricians, HVAC technicians, pest control experts, and others we count on to actually make society function are all in short supply, such that many of them can actually get more money as apprentices and newly-licensed beginners than many people with college degrees can expect to make just after graduation. And yet, the stigma persists. 

[Traveler]

2 hours ago, Ironhold said:

A very large part of our current problems is the dire shortage of skilled trades workers. 

For generations now, the mentality in the United States has been "college is for winners, trade school is for losers". 

There was a stigma attached to becoming a skilled trades worker, so much so that even in high schools kids were pushed towards college even when it should have been obvious that they would have been better suited in one of the skilled trades. As a result, these kids either failed out of higher education or didn't have the desire to go, hindering their entire lives. 

A very large part of why those ships are all stuck waiting to get into ports is because there aren't enough workers to handle them all once they dock. 

There aren't enough dock workers, crane operators, forklift operators, and others to actually offload those ships once they get to port. 

There aren't enough truck drivers, pilots, and train engineers to take the offloaded product and get them to where they need to go. 

There aren't enough mechanics and technicians to maintain those forklifts, trucks, trains, planes, cranes, and so on. 

Et cetra. 

Construction workers, plumbers, electricians, HVAC technicians, pest control experts, and others we count on to actually make society function are all in short supply, such that many of them can actually get more money as apprentices and newly-licensed beginners than many people with college degrees can expect to make just after graduation. And yet, the stigma persists. 

I am glad you have responded.  However, as we look into the management of supply chain philosophy - it is not that much different than what is going on in the airlines and just about every thing else in the corporate world.  40 years ago the supply chain was designed to peak flows (through put) but a great deal has changed with the just in time philosophy.  In order for the just in time supply chain to work correctly and efficiently - you cannot have a little extra than needed or a little less than needed.  The flow is designed to the exact need.    Anything over or under results in waist and profit loss.  Like the goal of the airline is to send out each plane with no vacant (unsold) seats and no one wanting to board the plane.  Anything else results in "lost revenue". 

All the machines (including robots) are designed and loaded for a specific need.  However, the reality is more like the tides where the levels rise and fall.  But the corporate world has learned to deal with supply chain tides with what is thought of as sophisticated model projection.  These models are mathematical models that are almost always based in Chaos theory - which are the same mathematical constructs that are used by the global warming alarmists.   

Another problem in the corporate management world is the propensity to focus on blame rather than solution.  The real breakdown is in planning - execution has not broken down but has been and is continuing to function properly based on design flows.  The problem with ships backing up started last June - and is often the case - instead of addressing the problem; government and corporate controls thought that the bottle nicks would somehow just go away.  There is no infrastructure available to handle the increased load at the port.  A little intelligence is starting to trickle down as it has been pointed out - solve the bottle nick at the current point and the bottle nick will just move down the road of the supply chain road and likely cause a worse bottle nick there.  

But there is another problem with updating the infrastructure to adjust to the new levels - because the new levels are believed to be peak levels rather than plateau levels.  In essence we do not need a 150 mile per hour Corvettes  hulling a__ down residential roads.  Supply chain over design failures are a major factor in failing corporations; right there with supply chain shortages resulting in undeliverables.

One of the principles of Chaos theory is that when sufficient parameter change takes place - that all parameters will seek new balance levels; which makes it almost impossible to achieve the previous parameters balances.   All indications point to a threshold change in parameters is already taking place.  This will result in critical shortages and overages at the same time.  I believe this will bankrupt many corporate entities.   Mistakes at this point could trigger a world wide depression and it honestly looks like (to me) that the current government regulations and efforts will only make matters worse.  And listening to all the rhetoric I am hearing - we may not make it to the next presidential election.  If lives are lost because of fuel shortages this winter - we will all know that the worst is yet to come.

 

The Traveler

[Backroads]

4 hours ago, Ironhold said:

A very large part of our current problems is the dire shortage of skilled trades workers. 

For generations now, the mentality in the United States has been "college is for winners, trade school is for losers". 

There was a stigma attached to becoming a skilled trades worker, so much so that even in high schools kids were pushed towards college even when it should have been obvious that they would have been better suited in one of the skilled trades. As a result, these kids either failed out of higher education or didn't have the desire to go, hindering their entire lives. 

A very large part of why those ships are all stuck waiting to get into ports is because there aren't enough workers to handle them all once they dock. 

There aren't enough dock workers, crane operators, forklift operators, and others to actually offload those ships once they get to port. 

There aren't enough truck drivers, pilots, and train engineers to take the offloaded product and get them to where they need to go. 

There aren't enough mechanics and technicians to maintain those forklifts, trucks, trains, planes, cranes, and so on. 

Et cetra. 

Construction workers, plumbers, electricians, HVAC technicians, pest control experts, and others we count on to actually make society function are all in short supply, such that many of them can actually get more money as apprentices and newly-licensed beginners than many people with college degrees can expect to make just after graduation. And yet, the stigma persists. 

Years ago, I overheard some mom complaining about her kid wanting to go to trade school. Apparently in their family, only college was an option. 

My little brother got his first career job in airplane tech making 1.5 times my salary.

[Ironhold]

On 11/15/2021 at 4:45 PM, Backroads said:

Years ago, I overheard some mom complaining about her kid wanting to go to trade school. Apparently in their family, only college was an option. 

My little brother got his first career job in airplane tech making 1.5 times my salary.

If I was to go back and finish getting my certification as a forklift operator I could probably make 5x my salary as I am right now with the newspaper. 

The problem is that the newspaper I'm with is so short-handed that they literally could not function without me, and things are so lean we can't afford to hire anyone else even if they could find someone willing to do everything I do.