Supply Chain Disruptions Reach the CEOs – Again

Houthi rebels from Yemen have attacked commercial vessels in the Red Sea since late November. CEOs expect these disruptions to last for a while.

However, the situation is much more dramatic than it looks on the surface. The USA as the “policeman of the world’s oceans” shows weakness here, which is mercilessly exploited by pirates (backed by rogue states).

The historically unique peace in global shipping that the USA maintained since WW II is giving way to an uncertain era in which companies themselves have to organize solutions for their supply chain and transport security.

Nearshoring, security associations and partnerships with governments are measures that need to be seriously addressed now.

As a consequence, CEOs and SCM Leaders must restructure their global production system to a regional footprint now. Local production for local demand.

Besides, this also increases sustainablity, quality and local employment. Action is required now, because the volatility will not go away in the foreseeable future.

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