Tuesday 12th Dec 2017 - Logistics Manager

Keep your friends close…

Resilience was forced to the front of supply chain professionals’ minds last year as a result of the tragic Japanese earthquake and ensuing tsunami.

While the impact of this was terrible, at first sight it appeared to be limited to that particular region. It is a reflection of how interlinked supply chains have become, that the impact was soon felt all around the world.

The lessons from this are still be learnt. But there are plenty of other factors that can test the resilience of a supply chain.

For example, what happens if you fall out with one of your supply chain partners?

Well Apple is finding out right now. It is engaged in a legal battle with Samsung, one of its major competitors in the smart phone market, over infringements of its intellectual property rights.

In fact, it has just won a $1 billion law suit in California.

And, while Apple now seeks to have the offending Samsung products banned in the US, Samsung says it is going to appeal against the ruling. At the same time there are reports that Samsung is planning to sue Apple over patents relating to 4G technology.

While all this is going on, Samsung is one of Apple’s most important supply chain partners providing a number of different chips for iPhones.

The Korean press is now full of stories that Apple is taking steps to reduce its reliance on Samsung. Nevertheless, it is still expected to be a major customer for some key components.

Disputes on the billion dollar scale are fortunately rare. But maintaining working relationships when you are in dispute with a supply chain partner is a situation anyone could face.

Sun Tzu, the Chinese military strategist, once said: “Keep your friends close and enemies closer.” 

Now there’s a man who knew a thing or two about modern supply chains.