Wednesday, June 2, 2021

"How the World Ran Out of Everything": Lessons we all need to learn

 

The New York Times points out that so-called "Just In Time" manufacturing practices were caught short by the COVID-19 pandemic and its widespread after-effects.


In the story of how the modern world was constructed, Toyota stands out as the mastermind of a monumental advance in industrial efficiency. The Japanese automaker pioneered so-called Just In Time manufacturing, in which parts are delivered to factories right as they are required, minimizing the need to stockpile them.

Over the last half-century, this approach has captivated global business in industries far beyond autos. From fashion to food processing to pharmaceuticals, companies have embraced Just In Time to stay nimble, allowing them to adapt to changing market demands, while cutting costs.

But the tumultuous events of the past year have challenged the merits of paring inventories, while reinvigorating concerns that some industries have gone too far, leaving them vulnerable to disruption. As the pandemic has hampered factory operations and sown chaos in global shipping, many economies around the world have been bedeviled by shortages of a vast range of goods — from electronics to lumber to clothing.

In a time of extraordinary upheaval in the global economy, Just In Time is running late.


There's more at the link.

The article is pretty accurate, IMHO.  Factories had grown used to running on a minimal stockpile of essential production supplies, relying on regular, reliable deliveries to bring them what they needed when they needed it.  Unfortunately, when those deliveries were interrupted due to any one of a number of factors aggravated by the COVID-19 pandemic, the factories could not continue normal production.  They had insufficient reserve supplies on which to fall back.

I think all of us can draw an important lesson from this.  How would - how will - our own emergency plans survive a sudden, unforeseen interruption in supplies?  Many so-called "preppers" speak glibly of having so many months' or years' food supplies put away, just in case;  but how many of them have checked their stockpiles against reality?  They might have mountains of rice and beans, but be short on essential medical supplies (painkillers, laxatives, diarrhea medication and so on).

To take just one example in detail:  if I have allergies, do I have a stockpile of anti-allergy medication, OTC and/or prescription, sufficient to tide me over if there's suddenly no more available in the shops?  That's actually a critical item, and should be very high on everyone's emergency supply list.  If we aren't used to living outdoors, where exposure to allergens is much higher, and we suddenly have no air-conditioning (because the power's out), and are forced to open windows to ventilate our homes, all those allergens will come flooding in.  If we have to "bug out" to another part of the country, with local allergens to which we haven't built up any tolerance, it's going to be even worse.  We should have at least several weeks' worth of such medications in stock, if not several months' worth - enough for every member of the family, including low-dose versions for children if necessary.

How many of our normal, day-to-day needs might be seriously affected if routine supplies are interrupted?  I'm not just talking about food, but many other things.  For example:

  • Routine maintenance of our motor vehicles.  Do we have enough oil, filters, small consumable parts, and tools to service our vehicles ourselves if necessary, or have a more mechanically minded neighbor or friend service them?  Do we have the necessary instructions or maintenance manuals?  Do we have even a small emergency reserve of fuel, so that if supplies to our local gas stations are interrupted, we have a tankful or two to tide us over, or get to a safer part of the country if necessary?
  • Light bulbs, and alternate sources of lighting.  If we can't buy them, we're stuck with what we've got.  I try to keep at least one spare bulb in reserve for every 3-4 in the house, plus emergency lighting that I can bring into play during prolonged power outages.
  • Prescription medication.  I have a minimum of 90 days' reserve supply of every single prescription medication my wife and I take, and I'm working towards getting that up to 180 days across the board.  For a couple of critical items (i.e. without them, I'm going to die!), I have a year's supply in reserve.  I also have a small reserve of potentially critical antibiotics, in case of a real emergency.
  • Ammunition.  I'm not expecting to fight World War 3, but if society is severely disrupted by a crisis, who knows what looting and/or anarchy might break out?  I have enough ammunition in storage to see my wife and myself through any likely need, and to keep in practice during times like the present, when regular supplies aren't available and/or affordable.
Those are just a few areas of concern.  I'm sure you can supply your own list.

Because they didn't foresee, expect or prepare for disruptions in supply or their labor force, many factories - in some areas, all of them - had to close their doors during the COVID-19 crisis.  Let's take a lesson from that, and make sure we're not making the same mistake.

One more thing.  During a crisis, you'll hear many accusations of hoarding directed against those who are prepared to look after their own needs.  This is a lie, but it's a very common and very persuasive lie.  You should expect the authorities to try to confiscate any "excess" or "hoarded" stocks they can find, in order to satisfy the needs of the mob and provide public relations pictures of how they're "doing something".  They may even mount door-to-door searches for such stocks, in defiance of constitutional and legal norms, justifying them in terms of the current emergency.  (This has been a common element in several emergencies to which I was exposed.)  If you try to resist, you'll probably be arrested.

That's why it's important to keep your reserves as unobtrusive as possible, in plain containers that won't attract envy or suspicion.  If possible, store some in a secondary location, so that if one is found and "looted" (officially or otherwise), you still have the other on which to fall back.  Also, don't talk about your reserves to other people you don't know well, or aren't sure you can trust.  If you do, word about them is sure to get out during an emergency.  People will come knocking on your door, demanding that you share with them.  If you don't (and you shouldn't, except for those who have a legitimate claim on you for support), you're going to attract anger, resentment, and possibly violent attempts to take what you have.  That's not a good place to be.

Peter


24 comments:

libertyman said...

I remember a company that was supplying General Motors with essential parts, and their deliveries had to be within a narrow window - not too early and never too late. The GM execs noticed that the plant was in the flight path of an airport. What would have happened if a plane crashed into the factory, they wondered? Yet no plans were made to account for such a disaster. These manufacturing strategies work well if everything else works, no contingency plans otherwise. See the trucks Ford has almost finished sans a microchip or two. The dependency on China as a supplier must change if we are to manufacture anything in this country.

Eaton Rapids Joe said...

A great post.

You mention that life will change, for example, people will open windows and expose themselves to more allergens.

I think it will also become much more physical.

As I age, I see that everything takes longer to heal. Consider blisters. A blister was mostly healed in a week when I was young. Now it takes much, much longer to heal.

The answer, of course, is to use our brains and not get blisters to start with. Wearing double socks with a slippery, synthetic pair snug against our skin. Taking the time to break in shoes, boots and gloves.

Just wanted to toss that out there.

-Joe

Eric Wilner said...

I've been seeing problems with Just-In-Time for a few years now. I'll design in some electronic component, the global inventory of which is several thousand (while the product I'm designing has a projected need of a dozen or so the first year), and by the time we go to build the second prototype batch the component is sold out, with no resupply expected for several months, presumably because some other clown designed it in at about the same time I did, in a product with greater volume.
If production is carefully planned to match current demand, but then demand increases, and there's nothing in warehouses, customer disgruntlement is inevitable.

Francis Turner said...

On that note, it is worth considering what happens if (when) we get another Carrington event and the supply disruptions that will cause

See https://archive.is/e4gUC for a recent article, albeit one that suggests the US may weather the solar storm fairly well. But of course the countries the US obtains supplies from may not do as well - I'd be particularly concerned about what would happen in West Taiwan (aka the PRC)

In the past Instapundit has gone on about this also

Matthew W said...

The first rule of being a prepper is "don't talk about prepping."

SiGraybeard said...

As usual, the root cause of the problem is government.

How? The reason Just In Time got started was to minimize costs, but why would having more in stock than what you need that day or that week cost more? It might not even cost more to buy more stock because prices go down as quantity bought goes up. The reason was that governments started taxing inventory at much higher rates. The costs to have spare parts and even more product than they knew would sell suddenly went up.

Back in the mid-80s the IRS hit the book publishing world like the A-10's nose mounted cannon. It caused a flurry of surplus book sales that burned through stocks and emptied the world of back issues of important books.

Uncle Lar said...

All that the "Just in time" method does is move the burden of maintaining inventory from the manufacturer and placing it all on their suppliers. Beneficial for the end users naturally, but adds considerable risk especially if the supply lines are less than rock solid.
True story, I was part of the review of a proposal by a major aerospace company to supply launch vehicles at KSC. They touted their just in time methodology repeatedly in the documentation, bragged on it in fact. Thing was a large and critical component was produced in Louisiana, could only be barged to the Cape via the intercostal waterway, a journey taking 10 days to 2 weeks given perfect weather. Gulf coast, prime hurricane weather. So their just in time operation claimed no need for any spares at the launch site because of how awesome JIT worked.
Didn't take me long to poke holes in that.
They did not win the award, and in any case that program was cancelled so water under the bridge, but one of many cases where some operational buzz words were used with no real understanding of what they really meant.

Aesop said...

"Just in time" is always yesterday.
But JIT inventory always wants you to pay today for a hamburger they hope to deliver to you next Tuesday.
That shortsightedness is its own reward, as all of us have lived, and continue to do.

And the First Rule About Prep Club, is you don't talk about Prep Club.

.Gov wants to search for my preps?
Best wishes with that plan.
They won't be found.
Having a few really old cans of something nasty available to salt your pantry with, come the day, is never a bad idea.

But if folks are going hungry, best not to look too fat or well-fed, nor get caught cooking up something delicious.

Jonathan H said...

In my opinion, there a balance must be made between efficiency and reliability.
JIT and other streamlining moves push further and further towards efficiency - but at the cost of reducing the margin for delays and problems.
It isn't only companies and factories that face this problem; it is also an issue with utilities and transport in cities. What happens when water or electricity is supplied to a large number of people through a small number of sources (or a single source)?
Are there backups available? Backup doesn't just mean electrical - it can be water supplies, natural gas pipelines, drainage systems, roads.
Most cities have 1 to 3 transmission lines supplying power. These use large expensive transformers; they take 6 months or more to make and deliver. There are a small handful of replacements in the country - does your utility have any, and are they the size needed in your area?
Some recent examples of too limited infrastructure.
- Several years ago there was a big power outage in the Northeast - people walking out of Manhattan blocked roads enough that those with cars couldn't get through. What if, instead, the cars had been attacked by pedestrians? If you had to walk home from work, do you have good shoes, seasonal appropriate clothes, and water available?
- Around Christmas, a natural gas pipeline in Aspen, CO was shut down. Those without backup heat options were in trouble. Can you heat and cook without power?
- During Hurricane Katrina, some areas flooded because the pumps to drain them didn't work, or their backup generators failed.
- Wildfires outside Ft McMurray Alberta several years ago blocked the 1 road out of town and then burned through much of town. Do you know alternate routes out of your town. A single road can be blocked for many reasons, ranging from flooding, accidents, and fires to demonstrations or checkpoints.

Eaton Rapids Joe has written several installment based fictional scenarios of involving disease, widespread power outages, and civil unrest - are you ready to for them?

Eric Wilner said...

Jonathan H: "In my opinion, there a balance must be made between efficiency and reliability."

Just so. This is a large part of what engineering is about: finding balance among functionality, reliability, unit cost, up-front costs, maintenance costs, and so on; doing this properly requires understanding the requirements, which can be challenging when no one seems to know what's needed nor what tradeoffs are acceptable.
See also the Texas power grid... how much extra investment is appropriate to prepare facilities in Texas for a once-in-multiple-lifetimes winter storm?

Cruising Troll said...

I was going to raise the issue of the taxman and JIT, but SiGraybeard already nailed it.

So I'll address a simple personal prep that's oft overlooked. Vitamins. Lay in a supply. Malnutrition has two components, calorie deficit and vitamin/mineral deficit. Deficiency in both compounds trouble.

Tschifty Mccoy said...

Look, alot of these issues with JIT and supply chains etc.. are symptomatic of a larger issue the entire world suffers from: crazy abundance/wealth. The world has never seen the kind of sustained, exponential prosperity as we have since the end of the Cold War, 1989. The entire developed world has simply forgotten what real poverty, scarcity, and hunger look like. So our society operates blthely ignorant of the dangers all around us, assuming it will all go on forever, demanding ever more free stuff and luxuries without work or sacrifice. We are like the people living in the shadow of Vesuvius, paying no heed to the rumblings nearby until too late.

Mikey said...

Enterprise Resource Planning (ERP) systems like SAP that actually run the world must have re-order point values or network schedules changed to allow "safety stock" when variations in the supply chain occur. Readers who are not familiar with how ERP systems like SAP drive JIT and are taking over everything might want to go read up.

Tschifty Mccoy said...

As an alternative, check out Met-Rx Meal Replacement powder. It is loaded with 36g protein and a ton of vitamins. Easily stored, decent shelf life if kept cool and sealed. It mixes easily with water, decent flavors. Maybe not something to live off exclusively but an excellent way to supplement your diet, get great protein, and vitamins if conditions limit fruits and veggies.

Speaking of fruits, many people are surprised to learn that potatoes are an excellent source of vitamin C. If you only had space and resources for one plant to grow, hard to beat potatoes.

The Freeholder said...

I'd love to know how you've stockpiled so much of your prescription meds. Even if I want to pay for them out of pocket, I'm told at the pharmacy that my insurance won't allow it.

Tsgt Joe said...

In the early 80's I was in a graduate program in management. Since it was in the Detroit area many of my classmates were from the auto companies. The professional office/accounting types were all gung ho for "just in time" as it was quite in vogue. The professional production types-not so much. The front office boys and girls were dismissive of the production folks concerns, telling them they needed to be less hide bound and more creative. You really have to be out on the production floor when the line goes down to appreciate how serious it is.

Tschifty Mccoy said...

Alot of what Peter and others mention about preparing is tied to where you live and your neighbors. If you have serious concerns that your neighbors are a threat to you rather than likely partners in a neighborhood survival plan, then you may want to move. Now is the time to vet neighbors to see who you can trust. As Peter has written in his prior series, we don't make it as loners. We need to band together to have any hope of weathering the storm.

Which brings us to what storm? Best case scenario we are looking at a slow but steady decline into high inflation and increasing doses of Venezuela and Argentina like dysfunction. Not the end of the world but requires serious prep. If we're not so lucky-- Carrington, EMP, etc..-- then the kind of prep required to live 1870s will be daunting indeed.

PPPP said...

Freeholder -
With 90-day prescriptions refills, they'll usually let you re-order in less than 90 days from the previous refill. Keep refilling at the minimum re-order point, and in a year or two you'll be several months ahead.

Peter said...

@The Freeholder: Ditto what PPPP said in the comment above. Just by renewing a couple of weeks early, you can get ahead of the game.

I also went to my health care provider and asked for an additional 90-day prescription for each of my critical medications. I explained to her that I wanted to be prepared for any shortfall in supply, and would pay cash for them, not charge them to my medical insurance. She called ahead to the pharmacy, warning them that the incoming prescriptions for me should not be put on my medical insurance, but would be paid for in cash, and she guaranteed that they wouldn't be misused. With that assurance, the pharmacy gave me the additional prescriptions without demur. You might want to try something like that.

As for extending my reserves from 90 to 180 days, that's been achieved mostly through early refilling of prescriptions. It does add up, over time. If I think things are about to "go critical", I'll probably ask my health care provider for another set of prescriptions, just in case.

Antibiotics can be bought for animal use (birds, fish, etc.) - an Internet search will bring up many articles about it. I bought six different animal-use antibiotics that are identical, in capsule size, dosage, etc., to those prescribed for human use, and the supplier warranted that they were made to human pharmaceutical standards. They form my emergency reserve in case of severe infection or disease. (When my wife and I contracted COVID-19 for the second time earlier this year, I had the equivalent of five Z-Pacs already in store. I was able to use them, at a time when regular Z-Pacs were in very short supply. That effectively paid for my entire antibiotic stash, as far as I'm concerned.)

Hope this helps.

Wayne said...

@Peter That strategy probably works well for routine meds e.g. BP meds, oral diabetes meds like metformin, anticoagulants like Eliquis, Plavix etc. Savings clubs like GoodRx can help as well for the ones you are going to buy with cash to build up a stock. As for the earlier comment that the insurance company won't allow that, it's more that they won't pay for it.

Controlled substances like narcotic pain medication and anti-anxiety meds like Xanax are likely to be more difficult to stockpile with the CDC and DEA anally probing doctors who prescribe them.

The Freeholder said...

Aye, and there's the rub. My insurer is also a JIT organization. I can get a refill for anything, 1 or 3 months, 7 days in advance of the predicted date I take the last pill.

I'll talk to the docs about an extra script, off-insurance and in cash. That might work for everything except the migraine preventatives. Those are stupidly expensive, even thought they do work. One is about $2700 every 3 months, another is $1300/month. Insurance and a reimbursement program pay for most of the first and all of the second, or I wouldn't be able to afford them. And I'd be a basket case.

Be glad you don't have chronic migraine, folks.

tweell said...

Sound out your neighbors while you have time. You may be pleasantly surprised, and in any case will know better who to trust and how far. Having folks that will back you is worth some preps in my humble opinion. If nothing else, you have to sleep sometime.

I'm the only vet in our little group of families. Not great, but folks tend to listen to me more because of that. My buddy across the street has his family and his stores, he's a master mechanic. My sister and her son will be showing up if SHTF, that gives us a paramedic and a young man who has gone to Front Sight school. She has supplies as well. The east neighbor + wife is a prepper too. The west neighbor isn't, but he does have something we don't have - a large swimming pool. That gives us months of water, and yes we have multiple purification methods.

The 'lone wolf' prepper may be the hero of many stories, but reality is quite different. Choose your tribe with care, and your tribe will have a much better chance of surviving.

Nick Flandrey said...

WRT getting meds, you can always "drop a bottle in the toilet" on accident. That should work at least once.

For pain and abusable meds, no one ever asked us if we wanted them to build out the draconian anti drug apparatus, but they did it anyway. We are supposed to be oversight on them so that is at least in part on us. All I can offer is to husband the ones you have, get what you can*, but most importantly explore other options than medication.

Considering the cost, well, what is your ability to function worth to you? I discovered that my chronic pain was not something I could "just deal with" when I ran out of the stuff that keeps it from getting to the point where pain drugs are required. Sometimes you have to spend the money to keep that from happening. I bought a massage machine, an inversion table, and some PT equipment to apply the treatment myself that I might not be able to get from others. And I made sure I won't run out again.

nick

*the abusable stuff is a special case, but consider that they limit it BECAUSE the extra finds its way into the MARKETPLACE. Outside of the marketplace there are also medicine "pools" organized by various entities that might be worth looking for. There have been several articles that I can recall on the subject.

Redneck said...

Kind of touched on below, but Covid didn't do any of this. The government did.