100 Days Under President Biden Packs a Supply Chain Punch
America has reached the 100-day milestone under a new presidential administration that has put supply chain front and center. In line with the increasing awareness and importance of supply chain, President Biden has acknowledged the critical role of this field more than any of his predecessors. A number of his early activities have set up both domestic and global supply chains for resilience after a tough 2020.
Pandemic supply chains get a booster shot
Health care supply chains were of course one of his first priorities. On his second day in office, Biden signed the Executive Order on a Sustainable Public Health Supply Chain to build and sustain “long-term capacity in the United States to manufacture supplies for future pandemics and biological threats.” More specifically, the strategy aims to strengthen the global pandemic supply chain system, create necessary redundancies to address possible points of failure in supply chains, set up mechanisms to respond to emergency supply needs and expand domestic production of pandemic supplies.
The Defense Production Act expands the manufacturing of COVID-19 tests, personal protective equipment and vaccines. This helped to double the original goal, with more than 230 million COVID-19 vaccine shots administered and about a third of the U.S. adult population fully vaccinated.
In addition, the White House forged a historic collaboration between rivals Merck and Johnson & Johnson to resolve bottlenecks.
The Biden administration also opened opportunities in health care supply chains by initiating a program that turns pharmacies and community health centers into vaccination sites; setting up federally run vaccination centers across the country; and expanding the list of eligible vaccinators to include dentists, paramedics and other medical professionals.
Paving the road to resilience
About a month into his presidency, Biden signed the Executive Order on America’s Supply Chains, which spells out a key point that supply chain professionals have long known to be true: Resilient supply chains revitalize manufacturing capacity, help maintain a competitive edge in research and development, and create well-paying jobs.
"The Association for Supply Chain Management is very enthusiastic about the Biden administration’s recognition of the field and the people who power it"
The executive order set in motion another 100-day timeline, during which the U.S. Secretaries of Commerce, Energy, Defense, and Health and Human Services will assess the supply chain risks related to semiconductors, high-capacity batteries, critical minerals and other strategic materials. Of course, the shortage of semiconductors, which engineers need to control the electrical properties and behavior of certain materials during manufacturing, has complicated the production of cars and trucks; personal computers, digital cameras and other consumer products; household appliances, such as smart refrigerators and washing machines; and countless other common items — in short, everything that’s modern and electronic.
The worldwide semiconductor issue highlights another key point: these initiatives may come from the White House, but they will not be successful unless they are carried out with an eye to universal challenges. International raw material and commodity shortages, escalating food prices, the Suez Canal debacle and, of course, a global pandemic all highlight that we live in an interconnected world.
Which brings up arguably the most important 100-day initiative: just hours into his presidency, Biden signaled his administration’s dedication to defending humanity’s ultimate infrastructure. By rejoining the Paris Agreement, the White House showed it is serious about slowing climate change and creating more sustainable business practices, which will undoubtedly change the way companies operate for the better and protect our collective future.
More to be done
The Association for Supply Chain Management is very enthusiastic about the Biden administration’s recognition of the field and the people who power it. There certainly have been some real victories in this short time. Still, it’s important to keep in mind that many of the 100-day strategies are just that: strategies. Rhetoric is good; action is better — and it’s going to take a lot of work to turn these initiatives into effective solutions. As always, those of us in supply chain are ready and eager to use our valuable skill sets to implement plans and infrastructure, achieve efficiencies, manage risk, and deliver results.
Biden establishes Supply Chain Disruptions Task Force
The US government is to establish a new body with the express purpose of addressing imbalances and other supply chain concerns highlighted in a review of the sector, ordered by President Joe Biden shortly after his inauguration.
The Supply Chain Disruptions Task Force will “focus on areas where a mismatch between supply and demand has been evident,” the White House said. The division will be headed up by the Secretaries of Commerce, Transportation, and Agriculture, and will focus on housing construction, transportation, agriculture and food, and semiconductors - a drastic shortage of which has hit some of the US economy’s biggest industries in consumer technology and vehicle manufacturing.
“The Task Force will bring the full capacity of the federal government to address near-term supply/demand mismatches. It will convene stakeholders to diagnose problems and surface solutions - large and small, public or private - that could help alleviate bottlenecks and supply constraints,” the White House said.
In late February, President Biden ordered a 100 day review of the supply chain across the key areas of medicine, raw materials and agriculture, the findings of which were released this week. While the COVID-19 health crisis had a deleterious effect on the nation’s supply chain, the published assessment of findings says the root cause runs much deeper. The review concludes that “decades of underinvestment”, alongside public policy choices that favour quarterly results and short-term solutions, have left the system “fragile”.
In response, the administration aims to address four key issues head on, strengthening its position in health and medicine, sustainable and alternative energy, critical mineral mining and processing, and computer chips.
Support domestic production of critical medicines
- A syndicate of public and private entities will jointly work towards manufacturing and onshoring of essential medical suppliers, beginning with a list of 50-100 “critical drugs” defined by the Food and Drug Administration.
- The consortium will be led by the Department of Health and Human Services, which will commit an initial $60m towards the development of a “novel platform technologies to increase domestic manufacturing capacity for API”.
- The aim is to increase domestic production and reduce the reliance upon global supply chains, particularly with regards to medications in short supply.
Secure an end-to-end domestic supply chain for advanced batteries
- The Department of Energy will publish a ‘National Blueprint for Lithium Batteries’, beginning a 10 year plan to "develop a domestic lithium battery supply chain that combats the climate crisis by creating good-paying clean energy jobs across America”.
- The effort will leverage billions in funding “to finance key strategic areas of development and fill deficits in the domestic supply chain capacity”.
Invest in sustainable domestic and international production and processing of critical minerals
- An interdepartmental group will be established by the Department of Interior to identify sites where critical minerals can be produced and processed within US borders. It will collaborate with businesses, states, tribal nations and stockholders to “expand sustainable, responsible critical minerals production and processing in the United States”.
- The group will also identify where regulations may need to be updated to ensure new mining and processing “meets strong standards”.
Partner with industry, allies, and partners to address semiconductor shortages
- The Department of Commerce will increase its partnership with industry to support further investment in R&D and production of semiconductor chips. The White House says its aim will be to “facilitate information flow between semiconductor producers and suppliers and end-users”, improving transparency and data sharing.
- Enhanced relationships with foreign allies, including Japan and South Korea will also be strengthened with the express proposed of increasing chip output, promoting further investment in the sector and “to promote fair semiconductor chip allocations”.