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For decades, the global supply chain operated like a well-oiled machine — complex, invisible, and seemingly invincible. Leaders didn’t have to think much about where things came from or how they arrived.
Click, ship, restock, repeat. That illusion shattered overnight when the pandemic hit. Empty shelves, idle factories, stalled production lines.
Suddenly, supply chains weren’t just a backend function. They were front-page news. And the truth became painfully clear: our systems were stretched and brittle by design.
In this episode, The New York Times Global Economic Correspondent Peter Goodman joins us to reveal what really went wrong. Drawing from his new book How the World Ran Out of Everything, Peter takes us beyond the headlines to unpack the decades-long decisions that set the stage for collapse.
From offshoring and just-in-time inventory to the AI hype and geopolitical risk, our conversation exposes the blind spots leaders can no longer afford to ignore.
Listen to the episode here on Apple Podcast & leave a review!
The Supply Chain Wasn’t Designed — It Just Happened
The global supply chain isn’t something anyone really “built.” It’s not a system with a blueprint. It evolved over time through millions of decisions optimized for cost, not resilience. From cereal to semiconductors, we rely on countless intermediate products crisis crossing oceans and borders. And yet, most of us rarely think about what it takes to make everyday life function…until it stops.
A car, for example, has over 30,000 individual parts, some of which have crossed the ocean multiple times before they land on an assembly line. So when just one link fails, like a computer chip stuck in transit, entire industries can grind to a halt.
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The Risks We Didn’t See Coming
Here’s the uncomfortable truth: the supply chain crisis wasn’t a one-off disaster. It was the logical outcome of chasing maximum efficiency at all costs. For years, businesses offshored production to the cheapest bidders, embraced consulting-driven “efficiency” models, and minimized inventory in the name of shareholder value.
But this lean, cost-cutting approach came at a price: zero slack in the system, over-dependence on single sources (especially China), and no room for error when a real shock hit. The obsession with just-in-time inventory worked great — until it didn’t. Leaders realized they’d been operating in a system they didn’t fully understand.
Peter shared stories of rail operators shipping products in the wrong direction just to hit metrics like “dwell time,” and executives turning away essential parts because they’d hurt quarterly numbers. These weren’t isolated mistakes, they were symptoms of a larger system that rewarded short-term stock price bumps over long-term viability.
Some Companies Were Ready. Most Weren’t.
Not all organizations were caught flat-footed. Toyota, for instance, had designed its supply chain with supplier proximity and resilience in mind. That helped them weather the pandemic with fewer disruptions. Meanwhile, giants like Ford were parking thousands of finished trucks in lots — waiting for chips that never arrived.
Larger retailers like Amazon, Walmart, and Target were able to charter their own ships, shift production more quickly, and even see the disruption as an opportunity to gain market share. But small businesses? They didn’t stand a chance. Without resources or alternatives, they were stuck waiting for parts stuck in floating traffic jams off the California coast.
The Consulting Playbook and the Illusion of Control
We can’t deny the role that big consulting firms played in pushing this fragile model even further. Peter reveals how companies were encouraged to cut deeper, reduce backup inventory, and follow rigid playbooks that looked good on spreadsheets but failed in the real world.
One example that stood out was a manufacturing company that eliminated low-cost parts — like $5 brackets — only to later spend tens of thousands in emergency shipping to make up for the delay. The irony? All of it was considered “strategic” by consultants focused on improving return on assets.
Listen to the episode here on Apple Podcast & leave a review!
The AI Hype Trap
Technology is often presented as the fix for broken systems. But Peter warns against blind faith in AI. While predictive algorithms and automation can make logistics faster, they don’t make systems wiser, especially when applied to outdated, brittle infrastructure.
AI might tell you when to ship and where to reroute. But if it’s making decisions in a vacuum without human context or accountability, it could amplify risks, not reduce them. Leaders must treat AI as a tool, not a savior. It needs human judgment layered in, especially in high-stakes global systems vulnerable to geopolitical shocks and black swan events.
Rebuilding with Resilience in Mind
So what should leaders do? Peter lays out a new way of thinking: Supply chains must be treated as strategic assets, not backend processes. That requires a shift in mindset — from maximizing efficiency to optimizing for adaptability.
- Build transparency across layers. Know who your suppliers’ suppliers are. Map vulnerabilities beyond the surface.
- Invest in regional diversification. Don’t over-index on any one country or region. The China-only playbook is outdated.
- Reframe inventory as insurance. Stockpiles aren’t waste — they’re protection against collapse.
- Balance AI with human foresight. Use automation to enhance, not replace, decision-making.
- Rethink cost-cutting culture. Stop chasing the cheapest option and start funding robustness where it counts.
Peter makes a powerful case that the real job of leadership isn’t just shipping products — it’s seeing around corners. And in a world where supply chains are vulnerable to everything from wars to weather to pandemics, leaders who don’t engage with their full system will be blindsided by the next disruption.
Final Thoughts
The global supply chain may feel like someone else’s job, something for logistics or operations to handle, but as Peter makes clear, it’s now a core part of leadership. It calls for leaders to ask tougher questions, make longer-term bets, and resist the quick wins of cost-cutting in favor of sustainable, shock-proof systems.
Peter Goodman’s call to action is clear: if leaders don’t understand the fragility of what they’ve built, they can’t protect it. And in an era where resilience is the new competitive edge, this understanding is urgent.
Listen to the full episode below to dive deeper into these strategies and learn how to build a more resilient, future-ready organization.