25 Mar Get the Scoop on the 100 Day Supply Chain Review
There’s been quite a few conversations in the media this spring about reviewing our country’s supply chains all spring. But why is this necessary for the defense industry?
100 Day Supply Chain Review
Back in February the Biden White House released The Executive Order on America’s Supply Chains. The intent of this executive order is to conduct a 100 day review to identify risks and establish policy that will increase American independence in the supply chains that are the lifelines of our country.
In the wake of the Covid-19 pandemic, vulnerabilities in many vital supply chains that our country depends on became quite apparent. One major shortfall was our shortage of essential PPE and we were forced to be reliant on competitive countries that have traditionally not held our best interest. Because of these issues, the President has expressed special determination in building a more robust and resilient supply chain network.
The supply chains under the most scrutiny from the 100 Day Review include semiconductor manufacturing, high capacity batteries, minerals and rare earth elements, pharmaceutical manufacturing and pharmaceutical ingredients, as well as healthcare supplies.
The main goal behind the 100 day review is to identify:
- the most critical goods and materials within each supply chain.
- the manufacturing or procurement processes within each supply chain.
- all possible vulnerabilities within each supply chain.
- any available backup or alternatives to critical supplies within each supply chain.
- workarounds in the event that a supply chain is severely impacted.
Reviewers would also hope to identify ways to increase domestic production for foreignly produced aspects in our country’s crucial supply chains. We expect new policy to also come into play in an attempt to mitigate future risk to the supply chains under review.
Over the course of the year, there will be an additional review of every vital supply chain used to run the country from national food production and distribution to military stockpiles.
Lawmakers Delve Deeper into the Defense Supply Chain
In tandem with President Biden’s order for a review, Lawmakers in the House of Representatives Armed Forces Committee have called for a special task force to take a deeper look into possible fixes for weakness in the defense supply chains.
The lawmakers involved are particularly interested in where shortages can cripple the military. Many aspects of military tech are dependent on microelectronics, battery technology, and rare earth minerals and elements. Over the past year, these supplies have been difficult to obtain and we were once again reliant on countries that don’t share our values.
The special task force is hoping to find work-arounds and more direct procurement of these vital supplies so that the military can run efficiently–even in the middle of a global disaster. After a three to six month review, the results of their findings will be presented on the House floor.
But what does a supply chain review mean for contractors?
While we can’t say for certain what new policies or legislation will be passed, it’s likely that there is going to be a call to reduce our dependence on products manufactured in China. The President wants the United States to put precedence on procurement of vital supply chain components from allies and, preferably, from within the United States itself.
In the case of semiconductor manufacturing, this could mean putting an emphasis in purchasing materials or manufacturing in other Asian countries like Taiwan, Vietnam, or from our southern neighbors in Mexico. There are also signs that some parts of electrical component manufacturing are moving back to the United States.
Once the 100 Day Review has been completed, we expect secretaries from each sector to report on their findings with policy changes to follow. We might even see new recommendations added to the drafting of the 2022 National Defense Authorization Act.
The President has expressed hope that these policy changes will increase our domestic industrial base in supply chains involved in national defense, public health, biological preparedness, and food production.
dasg By Your Side
No matter what changes come to the industry, we will walk with you every step of the way. With years of defense acquisitions practice, we have the knowledge and experience to help you manage obstacles and win contracts. Start a conversation with us today.