The redoubtable Sydney Freedberg reports (click here) on some very promising utterances out of the U.S. Navy leadership regarding whether the sea service can operate according to precepts devised to make business firms more efficient. I commented on this over at The National Interest a couple of years back (click here).
Short answer: no.
Thankfully, navy kahunas have come to agree. As they should. Take “just-in-time” manufacturing, which has been all the rage since Japanese firms pioneered it during the 1970s (click here). To oversimplify, that’s the notion that a business reaches maximum efficiency when it keeps few if any spare parts and supplies on hand, and depends on the supply chain to deliver just the right things on demand.
Makes sense, doesn’t it? Why invest in excess capacity?
And indeed it does make sense provided the assembly line runs smoothly and provided the supply chain performs as expected. But that’s not reality for armed forces. Edward Luttwak points out that warlike endeavors unfold according to a “paradoxical logic” that—one hopes—a manufacturer like Toyota will never encounter. Toyota runs by peacetime cost/benefit logic, and just-in-time techniques suit predictable, non-threatening operating conditions.
Now superimpose wartime surroundings on our hypothetical Toyota production line. Suppose saboteurs from Honda are constantly trying to interrupt the supply chain, starving Toyota of materiel to damage its competitive standing and grab market share for Honda. That’s what martial competition is like: antagonists trying to outdo each other by fair means or foul. No regulator will step in.
Still think Toyota would embrace just-in-time production? Nope. Prudent managers—those who cared about staying in business—would stockpile the makings of cars lest the infernal Honda sever the supply chain. They would regard a surplus as—with luck—suffiicient, and just enough as a likely deficit that could work disaster. Toyota would do the same to its competitors—and back and forth the competition would go by Luttwak’s paradoxical logic.
One hopes the navy leadership, the Pentagon, and the Trump administration as a whole now grasp that, as Big Bird used to sing, one of these things is not like the other. Military services are not businesses—and import the latest management theories from the business world at their peril.
That’s a supply chain to beware of.