Port strikes, border closings, tariffs, wars, strait and canal closings, factory fires, droughts, wild fires, volcanic eruptions, earthquakes, tsunamis, mine collapses, etc. There are now an innumerable number of natural and man-made ways your supply chains can come to a screeching halt and cut off your primary (or sole) supply of critical components, parts, and materials that you need to make the product(s) in your key product line(s).

When that happens, you need to so something. If you’re lucky, you have already identified an alternate supply and can switch to it or ramp it up. If you’re not, you have two choices: identify an alternate source quick or re-design to use less/none of the component/part/material in question.

The same way Japanese snack giant Calbee switched to black and white packaging when it could no longer get the coloured ink it needed because of the situation with the Strait of Hormuz, or the same way Tesla rewrote it’s software and firmware to use different chips during a semiconductor shortage, or IKEA reimagined the metal heavy lamp to use 60 precision cut birch veneer pieces to create a spherical lampshade.

But product design can only do this if they know they can get the alternative components or materials quickly and cost effectively. They need to be able to search supplier and product databases, logistics capabilities, and build realistic cost models to see if a an alternative design is worth pursuing before digging in deep, asking a supplier to provide a customized offering, and then having Procurement saying it will cost too much, sales saying the new price point will make the product unsaleable, supply chain say it can’t fulfill the product now because of a man-made or natural (disaster) supply chain issue, etc.

Plus, once it believes it has a workable, cost friendly, alternative it can immediately involve Procurement and Supply Chain, share the data, have its thesis validated, and prepare to update production lines with confidence.

One has to remember that there are two reasons the railroad barons became so rich. The first was their exploitation of workers (before unions and worker protection laws). The second was that they were built by engineers who built vertically integrated organizations that optimized every step and ensured every interaction that was required was executed to keep costs down and profitability high. Remember that vacuums are empty, and thus devoid of profit. So don’t create them between departments if you want to be successful.