Supply chain myths in the resilience and deglobalization narrative: consequences for policy

Abstract

The economic disruptions experienced during the COVID-19 pandemic and Russia’s invasion of Ukraine have generated a narrative of resilience and deglobalization that brings the old world order into question. Heightened public attention on perceived supply chain failures has exerted pressure on governments to intervene in firm-level operations to assure supply of essential or strategic goods. This paper argues that the narrative is founded on false premises. In particular, three supply chain myths have emerged in public and academic discourse: (i) lean management has gone too far and exacerbated disruptions in global supply chains; (ii) efficient supply chains are less resilient; and (iii) foreign supply makes supply chains less resilient. We argue that these beliefs are not adequately supported by evidence. They can displace analysis to negatively impact policy and actually diminish resilience. Drawing upon IB and supply chain management research, we investigate the root causes of perceived market failures. Recommendations are for an evidence-based debate on current events and policies.