GM could shut down for weeks & have minimal impact. Remember that brake plant strike a couple of years back? One part at one plant shut down most of GM's North American manufacturing
Yes, I know about that story. The major focus I have in analyzing events is that they are systemic and interelated to others, with cascading effects both forward AND backward on any chain. In this context, I analyzed that shutdown also in an economic sense. Did you read about the local and regional severe economic effects? Examples include many of the locals losing their jobs or having much less business due to the workers losing their takehome pay.
Basic issue is that cars, at least in the immediate term, are not a critical good. I can goose my old flivver along for a few more months. There are plenty of spare cars on the used car lots.
...OK...in the immediate term- you thus conclude that any GM disruption due to any crucial supplier being unable to supply parts, thus shutting down the GM plant will only be temporary...Again, I see the problem as systemic and resulting in a cascading effect, resulting in the GM senario, as a typical example, long-term or indefinately.
Here are a few key qustions to ask to help determine how long the shutdown:
1. how many of the 100,000 suppliers will be out of business or at least shutdown themselves due to their own system malfunctions?
2. how many parts will GM lack as a result of x number of said suppliers being down?
3. how many of them will go bankrupt?
4. how many can GM find sub suppliers for in a reasonable time?
(it must be noted that a substantial number of the current suppliers are the only ones making specific parts)
5. how many of the 100,000 suppliers interfaced with GM system, will re-corrupt theirs, even if GM becomes complaint in time, which is doubtful?
6. during the period GM is down, how many of the suppliers, espically those who can not be replaced, will go bankrupt, esp if they only supply GM?
7. what happens when many of the parts from overseas are no longer available due to the overseas companies having their own disruptions?
8. what happens when shipping is disrupted and some/many parts do not arrive or 'in time'?
9. what are the effects when the grid and telecom are down for x period of time?
Addition key questions to ask:
1. will GM be a target of cyberterrorism and/or physical terrorism?
2. if/when major civil unrest occurs in the areas surrounding the plants as well as key suppliers, how many workers will go to work vs. staying home for safety concerns or to protect their families?
3. as most experts expect banking disruptions, as well as many banks going bankrupt, much less a collapse, or at least, problems with transactions, how many workers will show up when they don't receive salaries after x time period?
4. only a very small % of the workers will store sufficient water and food; most will have about a normal supply of food for about 5 days, average: when food distribution chain is disrupted, how will the workers eat or obtain water, when water delivery systems are disrupted, in both cases for x number of days, weeks, months?
5. I project a market/economic meltdown months before Y2k- how will this affect GM stock?
7. when GM shuts down for x time period, how many shareholders will bail, with what cascading effects on the company?
8. the cascading economic effects of a GM shutdown, cascading thruout much of their supply chain, as well as dealer chain, after x time period can be/will be disasterous for the economies in a number of cities- will such be significant enough in themselves to cause a depression? maybe....
The permutations are endless...
And, that is specifically my point- EVERY single such vital issue must be evaluated and planned for in a SYSTEMIC, INTERRELATED, INTERDEPENDENT context!
As applies to GM specifically, what is their fault tolerance when there are so many layers to their chain....from materials acquisition/mining/manufacturing at source......down to auto delivery to the dealers....how fragile is that entire global, sophisticated, extremly complex interdependent chain of perhaps 10-12 layers?
What is the fault tolerance of other interelated chains, such as oil/gas/refining/heavy transport, with its own about 10 layers, which, if/when signficantly disrupted, will make autos irrelevant?
What is the fault tolerance of the grid, and telecom....?
As my article points out, no one can ascertain the answers...We will not know before the fact....
But, whether modern civilization continues or gradiently closes down, will be determined by the above unanswerable questions....
My group is taking several companies (with enormous potential) public very soon...we are doing so in the expectation that there is at least a reasonable chance that the fault tolerance level of the infrastruture and of society will withstand so many disruptions in so many sectors occuring simultaneously/or nearly so....
Any comments to the above?
Ken |
