COVID 19 S Impact On Globalization and Innovation
COVID 19 S Impact On Globalization and Innovation
Tammy McCausland
We are more than six months into the Reconstruction and Development, sug- as well as the global economy.” A sub-
pandemic with no signs of the corona- gests in her Financial Times piece that sequent BofA study published in July
virus abating. In that short time our “the quest to find the most cost-effective 2020, notes that “companies in over
world has changed dramatically––how suppliers has left many companies with- 80% of global sectors have experienced
we live, shop, educate our children, out a plan B” and that businesses will disruptions in their supply chains during
receive healthcare services, and engage be forced to “rethink global value the pandemic.” Many stakeholders are
with others personally and profession- chains … [that were] shaped to maximize drawing the same conclusion—namely,
ally. Companies have had to adapt efficiency and profits.” She asserts that Browning writes, that “portions of sup-
quickly or risk going under; many are the coronavirus “will not end globaliza- ply chains should relocate, preferably
reinventing themselves and reshaping tion, but it will change it. Companies within national borders, and failing
how they operate. Experts offer differ- will have to adapt to succeed.” In a that, to countries that are deemed
ing opinions about the best path for- CoronaNomics podcast episode, journalists allies.” And while reshoring will come
ward for companies, especially those Ben Chu and Lizzie Burden discuss with higher costs, she says the costs will
with global operations: some advocate deglobalization with Harvard economist be manageable.
reshoring and bringing operations Dani Rodrik and Penelope Goldberg, for- Reshoring is a “complex proposi-
home; others encourage companies to mer chief economist of the World Bank. tion,” writes Michelle Comerford in
open up and collaborate; yet others sug- Rodrik and Goldberg offer their perspec- “‘Reshoring’ in the Age of a Global
gest using data to help companies pivot tives about what a less globalized world Pandemic,” because it requires site
more quickly. might look like. selection planning, defining the opera-
The decades-old global supply chain Since the pandemic caught Europe tion’s scope, determining project financ-
was created during the push to global- and North America with their prover- ing and incentives, and careful planning
ize; companies moved manufacturing bial pants down, businesses are evalu- and execution. Sara Brown notes,
offshore because it was cost-effective ating their supply chains. According to “Many companies are looking at
and efficient. But in the early days of an April 2020 Thomas survey of 878 restructuring their supply chains, trying
the coronavirus, as countries scrambled North American manufacturing and to balance resilience with efficiency and
to source scarce personal protective industrial sector professionals, “64 per- reduced costs—a process either started
equipment (PPE) and ventilators, prob- cent of companies across the manufac- or accelerated because of the pan-
lems with relying on only a few players turing and industrial sectors ‘are likely demic.” But in her article, “Reshoring,
in the supply chain became glaringly to bring manufacturing production and restructuring, and the future of supply
obvious, especially given tensions with sourcing back to North America,’ to chains,” Brown quotes MIT professor
China and the global competition for avoid similar difficulties in the future.” Yossi Simchi-Levi, who says restructur-
these supplies. Beata Javorcik, chief COVID-19 has “exposed fault lines in ing plans vary by industry and reshoring
economist at the European Bank for global supply chains,” writes Candace doesn’t guarantee resilience, and MIT
Browning in a recent Barron’s commen- professor David Sheffi, who says, “While
In this space, we offer a series of summaries on tary. Browning, head of global research some companies have been leaving
key topics, with pointers to important resources, at Bank of America (BofA), cites a China over the last decade as costs go
to keep you informed of new developments and
help you expand your repertoire of tools and
pre-coronavirus BofA study in which up… most can’t and won’t, move their
ideas. We welcome your contributions, in the the authors noted that “companies in supply chains out of the country com-
form of suggestions for topics and of column half of all global sectors for North pletely.” Brown also points out how
submissions. America were reshoring their pilot proj- both professors agree that overall, the
DOI: 10.1080/08956308.2020.1813506 ects… the first signs of reversal in a supply chain has held up well.
Copyright © 2020, Innovation Research
Interchange.
multi-decade trend that could have pro- The pandemic hasn’t been all bad
Published by Taylor & Francis. All rights reserved. found implications for manufacturing, news. COVID-19 spurred the rapid
face masks, face shields, and parts for Henry Chesbrough. 2020. To recover faster from Covid-19, open up: Managerial implications
ventilators to help solve the shortage. from an open innovation perspective. Industrial Marketing Management 88: 410–413.
https://doi.org/10.1016/j.indmarman.2020.04.010
3D printing, as I outline in “3D Printing’s
Time to Shine,” has played an important Michelle Comerford. 2020. ‘Reshoring’ in the age of a global pandemic. Supply & Demand
Chain Executive, July 8. https://www.sdcexec.com/warehousing/article/21131159/
role in this innovation.
reshoring-in-the-age-of-a-global-pandemic
Adi Gaskell offers other examples of
Luis Dahlander and Martin Wallin. 2020. Why now is the time for “open innovation.” Harvard
positive innovations that have hap-
Business Review, June 5. https://hbr.org/2020/06/why-now-is-the-time-for-open-innovation
pened during the pandemic in his article
Adi Gaskell. 2020. How the coronavirus is transforming innovation. Forbes, June 4.
“How The Coronavirus Is Transforming
https://www.forbes.com/sites/adigaskell/2020/06/04/how-the-coronavirus-is-transforming-
Innovation.” Gaskell mentions “low- innovation/#52313a88c73e
hanging fruit” innovations, like plexi-
José Guimón and Rajneesh Narula. 2020. Ending the COVID-19 pandemic requires more
glass installed by grocery stores and international collaboration. Research-Technology Management 63(5): 38–41. DOI:
other retailers; he also discusses more 10.1080/08956308.2020.1790239
radical change, like robots in hotels and Megan Hart. 2020. Remote work after the pandemic. Journal of Accountancy, July 13.
digital transformations in education and https://www.journalofaccountancy.com/news/2020/jul/remote-work-after-coronavirus-
health care. Gaskell writes, “while inno- pandemic.html
vation is a fundamentally disruptive Beata Javorcik. 2020. Coronavirus will change the way the world does business for good. Financial
affair, the process of innovation itself Times, April 2. https://www.ft.com/content/cc2ff3f4-6dc1-11ea-89df-41bea055720b
can be disrupted. We’re already seeing Lynn Kier. 2020. Remote work: The ultimate equalizer for talent acquisition and employee
the early signs of that in the initial experience. Forbes, Aug. 10. https://www.forbes.com/sites/forbescommunicationscoun-
months of the pandemic, and it’s a cil/2020/08/10/remote-work-the-ultimate-equalizer-for-talent-acquisition-and-employee-
transformation that is likely to have sig- experience/#3fa117327986
nificantly further to go yet.” Tammy McCausland. 3D printing’s time to shine. Research-Technology Management 63(5):
Henry Chesbrough, the father of 60–62. DOI: 10.1080/08956308.2020.1790290
open innovation, asserts that innova- Sudneesh Nair. 2020. 5 data-driven solutions to the global disruption of supply chains. Fast
tion will have an important role to play Company, May 27. https://www.fastcompany.com/90508657/5-data-driven-solutions-
to-the-global-disruption-of-supply-chains
in the recovery from the pandemic. In
an article published in Industrial Thomas. 2020. Supply chain dive: 64% of manufacturers say reshoring is likely following
pandemic survey. May 14. https://business.thomasnet.com/press-room/news-highlights/
Marketing Management, he writes,
supply-chain-dive-mfg-reshoring-is-likely
“Opening up mobilizes knowledge from
many different places, causing our World Health Organization. 2020. R&D Blueprint. https://www.who.int/teams/blueprint/covid-19