This is a result of the bullwhip effect https://en.wikipedia.org/wiki/Bullwhip_effect
Rolling supply chain disruptions were predicted to happen early this year when China shut down much of its economy due to the coronavirus.
Rolling supply chain disruptions were predicted to happen early this year when China shut down much of its economy due to the coronavirus.
Yup, and has been unable to meet nV's demand-- such that this has been accused of being a "paper launch".
There are three major prblems:
1) Nobody holds inventory.
This is the primary root of all problems. Because everybody is on just-in-time inventory, nobody can absorb even the slightest shocks. Maximally efficient is minimally robust.
2) Semiconductor industry consolidation
The semi companies have been on a competition buying spree over the last couple of years. There's no need worry about a competitor holding inventory and winning a contract from you if you've bought them all out.
3) The "minimum volume" of a chip run through a fab is enormous.
An 8 inch wafer is about 32,000 mm^2. If your chip is 2mm per side (pretty big for "popcorn" type chips), a single 8 inch wafer produces 8,000 of them. If it's 1mm per side, you've got 32,000 of them.
You probably won't produce less than 10 wafers at a time.
So, that means your inventory goes from dead 0 to roughly a quarter million in a single whack with an 18 week lead time (and I'm just counting wafer starts--I'm not even talking about testing and packaging resources getting choked). And most projects never reach a quarter million in volume--and the ones that do generally blow WAY past it in a hurry.
Good luck managing that inventory flow.
I always like to tell my friends and family the same thing by saying, "Efficiency is not the same as efficacy"
It is interesting how it has similarity with software development - several years ago i worked on a project that was being done under total Lean/Agile/Scrum regime. Scrum forces significant lead times into the upstream/downstream components chain(graph) like in a supply chain. As a result the whole upstream/downstream components graph relationship on that project got extremely slow (a sprint wait to get new upstream component version, try to use it in this sprint and fail because of bugs, file the bugs, the bugs get fixed the next sprint at best, while other components trying to move forward in their development ) and ultimately completely broke down after about 2 years to the point where the product couldn't even be built as not just functionality (the functionality got really lost months before that), the interfaces got completely out-of-wack without any chance of reconciliation in the setting of that process, and the product was quietly canceled soon as a result.
yeah.
If we optimize for efficiency, we get supply disruptions every 5 years or so. If we optimize for redundancy, we suffer from higher prices all the time, and delayed availability of all new tech. I don’t know which is worse.
JIT works for fungible commodities, you suddenly realize how much the cost/volume/downside ratio works when your always-on JIT capacity goes to zero.
I don't want my water treatment plant to go down because a bean counter decided that spare parts are now stocked entirely by McMaster-Carr.
Combine that with the evolution of an industry (safe players dying out) and it's another dynamical systems thing. Industries get riskier and more coupled and more efficiently tuned to normal circumstances then blow up.
Anyway, yes, all those things are tools that should be used with an understanding of their positive and negative impacts (even Scrum has some positives...), not something undiscerning managers impose despite the realities of the field.
And if you go read Deming, the guy that created most of what goes into Lean (production, not software development) and JIT, he has some very interesting opinions on undiscerning management.