3 ms·

> Shouldn't contracts prevent that sort of behavior (without proper compensation)? That depends on how big the customer/order is, no? If (as a manufacturer) yo

by bkor 6y ago

> Shouldn't contracts prevent that sort of behavior (without proper compensation)? That depends on how big the customer/order is, no? If (as a manufacturer) you could get away with not having it in a contract, why include it? Similarly, instead of actually cancelling they could also "lie". Say that there are capacity issues, etc. That the capacity issue is mostly because they resold the existing manufacturing capacity, is left out. > Just in time delivery The well-known example of this is Toyota. Interestingly, they've started ensuring they do have stocks. See e.g. https://www.reuters.com/article/us-japan-fukushima-anniversary-toyota-in-idUSKBN2B1005 https://www.reuters.com/article/us-japan-fukushima-anniversa.... I found that rather interesting.

ethbr0 6y ago
As with all things, an optimization (e.g. agile, JIT/lean manufacturing) is predicated on certain assumptions. In this instance, "we exist in an ecosystem where our suppliers can rapidly respond to volatile demand from us." If the assumptions fail, then it's not a failure of the optimization, but an incorrect application of it. Maybe we don't currently live in a world in which elastic semiconductor availability at scale can be assumed.
- tehjoker 6y ago
  Nearly all industries have moved to Just-In-Time to reduce costs, at the cost of making the entire economy more fragile. We saw this highlighted in the pandemic as suddenly there were no reserves of hospital capacity due to JIT optimization.
  - to11mtm 6y ago
    Heck even consumer goods like toilet paper were impacted. JIT is useful when the end-product has a high depreciation rate and/or you forsee yourself frequently changing the part out for a newer version. Another tendril on the issue; modern accounting practices tend to prefer JIT instead of the costs/overhead mechanics of storing inventory.
- lenkite 6y ago
  When I first studied about JIT in college, I asked my professor: Doesn't this manufacturing methodology lack fault-tolerance and isn't it deeply susceptible to natural calamities or economic failures ? He replied that it was proven, adaptable and reliable. Other suppliers would come in if some suppliers failed. JIT (aka lean manufacturing) today has now permeated pretty much most of the global supply chain. Human civilisation is far more fragile at the moment than in the last few. hundred years.
  - ethbr0 6y ago
    The true argument should have been that it's more efficient (for everyone involved). Which would have invited the honest debate between the relative merits of resilience vs efficiency.
    - georgeecollins 6y ago
      That reminds me of Taleb's idea of comparing certain investment strategies to "picking up pennies in front of a steam roller" (or insuring mortgage backed securities). It's easy money until it isn't. But when it isn't, it is really bad.
  - perl4ever 6y ago
    >Human civilisation is far more fragile at the moment than in the last few. hundred years. It was less fragile when there were famines all the time? I don't understand how people can repeat this rhetoric when it seems obvious to me that however fragile it is, it's less so than in all of history. Even if things rapidly get much, much worse, it wouldn't change my opinion. How do you think we would determine which is the correct perspective?
    - ethbr0 6y ago
      There's a distinction between technology level and time disposition, I think. Compared to a self-sufficient small-scale agrarian society (say, 10th century Europe), what would have caused famine in their time would not for us. At the same time, we allocate our time differently than they did -- few of us actually farm for ourselves. If we allocated time more similarly + applied current technology, it'd be pretty hard for people to starve (between improved long term food storage, GMO crop yields, and environment mitigation). Side note: the always educational Bret Devereaux lays out a solid argument for why famines were the result of an underdeveloped monetary and trade system, that led to fragile choices being optimal for individual farmers. [0] [0] see "Risk Control" section https://acoup.blog/2020/07/24/collections-bread-how-did-they-make-it-part-i-farmers/ https://acoup.blog/2020/07/24/collections-bread-how-did-they...

by bkor 6y ago

ethbr0 6y ago

As with all things, an optimization (e.g. agile, JIT/lean manufacturing) is predicated on certain assumptions. In this instance, "we exist in an ecosystem where our suppliers can rapidly respond to volatile demand from us." If the assumptions fail, then it's not a failure of the optimization, but an incorrect application of it. Maybe we don't currently live in a world in which elastic semiconductor availability at scale can be assumed.

tehjoker 6y ago
Nearly all industries have moved to Just-In-Time to reduce costs, at the cost of making the entire economy more fragile. We saw this highlighted in the pandemic as suddenly there were no reserves of hospital capacity due to JIT optimization.
- to11mtm 6y ago
  Heck even consumer goods like toilet paper were impacted. JIT is useful when the end-product has a high depreciation rate and/or you forsee yourself frequently changing the part out for a newer version. Another tendril on the issue; modern accounting practices tend to prefer JIT instead of the costs/overhead mechanics of storing inventory.
lenkite 6y ago
When I first studied about JIT in college, I asked my professor: Doesn't this manufacturing methodology lack fault-tolerance and isn't it deeply susceptible to natural calamities or economic failures ? He replied that it was proven, adaptable and reliable. Other suppliers would come in if some suppliers failed. JIT (aka lean manufacturing) today has now permeated pretty much most of the global supply chain. Human civilisation is far more fragile at the moment than in the last few. hundred years.
- ethbr0 6y ago
  The true argument should have been that it's more efficient (for everyone involved). Which would have invited the honest debate between the relative merits of resilience vs efficiency.
  - georgeecollins 6y ago
    That reminds me of Taleb's idea of comparing certain investment strategies to "picking up pennies in front of a steam roller" (or insuring mortgage backed securities). It's easy money until it isn't. But when it isn't, it is really bad.
- perl4ever 6y ago
  >Human civilisation is far more fragile at the moment than in the last few. hundred years. It was less fragile when there were famines all the time? I don't understand how people can repeat this rhetoric when it seems obvious to me that however fragile it is, it's less so than in all of history. Even if things rapidly get much, much worse, it wouldn't change my opinion. How do you think we would determine which is the correct perspective?
  - ethbr0 6y ago
    There's a distinction between technology level and time disposition, I think. Compared to a self-sufficient small-scale agrarian society (say, 10th century Europe), what would have caused famine in their time would not for us. At the same time, we allocate our time differently than they did -- few of us actually farm for ourselves. If we allocated time more similarly + applied current technology, it'd be pretty hard for people to starve (between improved long term food storage, GMO crop yields, and environment mitigation). Side note: the always educational Bret Devereaux lays out a solid argument for why famines were the result of an underdeveloped monetary and trade system, that led to fragile choices being optimal for individual farmers. [0] [0] see "Risk Control" section https://acoup.blog/2020/07/24/collections-bread-how-did-they-make-it-part-i-farmers/ https://acoup.blog/2020/07/24/collections-bread-how-did-they...