It’s undoubtedly been a difficult few years for global supply chains. From the COVID-19 pandemic and disruptions to two of the world’s busiest shipping routes, to ongoing acts of genocide and over 60 countries heading to the polls this year alone, some experts believe the signs point to us entering a new age of perpetual supply chain instability.
“We’re in a new era. I don’t think that there is a normalisation anymore. I think that what companies are now facing is that supply chain disruption is the new norm,” said ,” Marissa Adams, head of global trade solutions at HSBC Americas, said to Yahoo Finance in a recent interview.
Unprecedented disruption?
It’s easy to look at events unfolding in the present and struggle to view them with the same objectivity as the distant (or even not so distant) past. Disruption has been a thorn in the side of global trade networks since they first started developing almost half a millenia ago.
HSBC’s new report on supply chain resilience admits that “Supply chain disruption is not new: shipwrecks, piracy, and natural disasters have disrupted supply chains for centuries.”
In the past century, two world wars, severe financial collapse, the downfall of empires, and several plagues with higher mortality rates than COVID-19 all conspired to make the gyroscope of worldwide supply chains wobble.
Surely, the kinds of disruption caused by these cataclysmic events throw current supply chain woes into perspective?
According to HSBC’s report, “the supply chain disruption keeping procurement executives awake at night in 2024 is very different from the disruption that their predecessors worried about in 1924 or 1824.” Today, the report’s authors argue, trade flows today are orders of magnitude larger, more complex, and more vulnerable to disruption. Not only that, but some of the disruptions being faced by supply chains today are genuinely unprecedented. The fact that over a quarter of the world’s population will head to the polls in the biggest election year in human history could have massive consequences for global trade relations, especially since the report notes that “in many of those ballots, messages of protectionism, isolationism and nationalism feature strongly.”
Steven Carnovale, a professor at Florida Atlantic University, warns that “In many cases, [procurement organisations] are thinking over a five or 10-year timescale, and predicting likely stability over that period is becoming increasingly difficult.”
- Risk & Resilience
