De Veerkracht van Supply Chains

We spreken Glenn Aguilar Hernandez. Hij bekeek in zijn postdoc onderzoek de veerkracht van de toevoerketen, a.k.a. de supply chain - en in het bijzonder die van semiconductors [halfgeleiders]. Dat zijn de chips die in zo’n beetje elk elektronisch apparaat te vinden zijn. Tijdens de pandemie bleken deze ineens moeilijk te krijgen: hoe kwam dat?

Hij vertelt hoe het tekort ontstond en welke lessen uit zijn onderzoek breder toe te passen zijn bij ingrijpende gebeurtenissen in de toekomst, zoals bijvoorbeeld het huidige conflict tussen Rusland en Oekraïne. Zitten we straks weer zonder chips? Of beschikken supply chains over voldoende veerkracht? Glenn spreekt geen Nederlands. Het interview is dan ook in het Engels opgenomen.

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Host: Deborah Sumter

Meer informatie: Website Centre for Sustainability

Productie: Klaenk
Artwork: Visual Friday

Transcript

00:00:00
Glenn Aguilar: Think about your computer. Think about your smartphone and any electrical component that has a computer inside, it might require semiconductors.

00:00:12
Deborah Sumter: Je luistert naar Uit de Ivoren Toren. Vandaag spreek ik Glenn Aguilar Hernandez. Hij doet onderzoek naar de veerkracht van supply chains, in het bijzonder die van semi-conductors. Dat zijn de chips die in zo'n beetje elk elektronisch apparaat te vinden zijn. We vragen hem naar de belangrijkste lessen uit zijn onderzoek en hoe die toe te passen zijn bij verwoestende gebeurtenissen in de toekomst. Ik ben Deborah Sumter. Dit is aflevering 4 van seizoen 4: De veerkracht van supply chains. Let op. In deze aflevering doen we het net even iets anders dan je van ons gewend bent. Onze gast Glenn spreekt namelijk geen Nederlands. Je hoort dan ook een interview dat vanaf nu is opgenomen in het Engels.

00:00:56
Deborah Sumter: Yeah. Hello, Glenn. Welcome in the studio. Yes. I'm just going to jump in and ask you my first question. Can you tell a little bit more about yourself, who you are? What do you do?

00:01:15
Glenn Aguilar: Sure. Well, thanks for the invitation. I'm very happy to be here. My name is Glenn Aguilar, and I'm a post-doc researcher at Leiden University in the Institute of Environmental Sciences. Well, a bit about myself. I'm originally from Costa Rica. And in terms of research, I've been working over 3 years in sustainability projects from academic and non-academic institutions, and I'm very passionate about interactions between economy, society and environment. And yeah, that's basically why I'm here as well.

00:01:51
Deborah Sumter: Yes. You said you were very interested in sustainability. Can you tell us more like when that started or what was the specific moment where you... for you, where you were like, okay, this is an important subject to focus on?

00:02:06
Glenn Aguilar: Yes, sure. So for that, actually, I would like to tell you a bit about my background. Right. And well well, I grew up in Costa Rica and I wasn't a city boy. I grew up in a rural area very close to the mountains. For those that know about it, it's very close to San Jose, but just in the mountains. And I grew up next to a coffee plantation and around 5 kilometers from there, there was a national park. So why I'm telling you this, I mean, since I was a kid, actually, I was really aware of the interaction between the community and the environment. I mean, we were as kids,` like, really driven to to protect the rivers, the forests and so on. And this was not only because of the sake of, of of of conservation of nature, but also for.... because it was beneficial for the community.

00:03:08
Deborah Sumter: Can you tell us a little bit more about that?

00:03:10
Glenn Aguilar: Yeah, sure. So basically I'm working in different projects and just having experience on combining multiple projects regarding critical raw materials and also global supply chain. So for example, last year we just finished one of the projects that was on understanding how COVID 19 has affected global supply chains. And well, basically, you can see the influence of many aspects over there, right. And and well, the COVID as a disrupted event, we were really interested in to look into those sort of things because that tell us also about how adaptable can be a supply chain in general. Well, that adaptability is something that we refer to as resilience as well.

00:04:12
Deborah Sumter: And you specifically looked at the semiconductor industry. Why semiconductor? Tell us more.

00:04:22
Glenn Aguilar: For semiconductors itwas really interesting...because if we think about semiconductors, we're referring to components that go into electronics. So think about your computer, think about your smartphone. And any electrical component that has a computer inside it might require semiconductors. And it was very interesting because what we would expect to see at the beginning of the pandemic, at least in the Netherlands, is that the demand for semiconductors and, well, all the products that are related to to the supply chain will be reduced. Right. Because you have less trade and actually people... well... well in the middle of an economic crisis, you wouldn't expect that people would spend [money] on electronics and so on. But if you see the numbers, actually at the beginning of the pandemic, it was a rise in electronics, which means there was a rise in the... in the semiconductor demand for... from the Netherlands. And that was very interesting because like, okay, how come in the middle of a pandemic we're still also taking electronics outside and... and therefore the semiconductors. So basically that was the main motivation that we have for understanding why this... this system has started to evolve in an opposite way than we expected.

00:05:55
Deborah Sumter: And why was it? What was the reason?

00:05:58
Glenn Aguilar: Now the reasons are very interesting. So yeah, let's get back, 2 years ago at the beginning of the pandemic, right? So we start with the lockdowns basically.

00:06:11
Deborah Sumter: So 2020.

00:06:12
Glenn Aguilar: 2020 exactly. We start with the lockdown. Basically what happened in terms of consumption is that I mean, of course, I need a mouse, I need a laptop to work from home and a new laptop and so on. So the consumption in electronics went up during that period. Now, if you think about... about your consumption during that time, maybe you wouldn't think about buying a car, right. And, well, car industries are also related to semiconductors. They need it for their sensors and also the computers in the cars. So despite the decrease in certain industries like cars and the demand for cars, they were rising in electronics. And everything started just with the lockdowns, right. Just to take that decision. Now continue in 2020. Well, we have some ups and downs, of course, because we have some relaxation process in the middle of 2020. Then we have a strong lockdown at the end of 2020. So what happened next. Just at the beginning of 2021? Well, basically, the consumption of electronics continued to be as.. as high as before. And yeah, suddenly, I mean, people feel like more flexible. We have also well, we have the vaccine by then and then they start to buy cars. So you can imagine the pressure of the... of these... of the semiconductor production. Right. Because then something that was missing in 202. It becomes important in 2021.

00:08:04
Deborah Sumter: Now looking at the current situation with the war in Ukraine, I can imagine that that is now more of a disruptive event that's happening and that can also influence like the supply chains.

00:08:22
Glenn Aguilar: Indeed. Yeah, well, we can't hear right now on the news. So one of the things that we've been doing for the...for.. for the... for the research on semiconductors and COVID 19 was well, looking into news. Right. And going into social media, for example, Twitter. And when I go back to January this year what I noticed is that indeed you will see news regarding the semiconductor shortage and also linked with the whole COVID situation and the global supply chains. I tried to double check this information two weeks ago and the narrative was completely different. Right now, you can see that people are talking about semiconductors and the first thing that they refer is with... with raw materials related to Ukraine, for instance. So what I would expect is that, well, in the coming months, well, the narrative will change completely. And perhaps what we have done during last year will be already. Well, it has to be up to date for... for sure. And this might be... sounds depressive from my side, right, as a researcher, because. So why did I do the research beforehand? But also, I think it is important to consider the process itself. Right? So if we think about the conflict between Russia and Ukraine and how that's going to affect the world, if we think about what happened in the past two years with... with COVID, actually, we can talk about disruptive events in general. And it doesn't matter in which period we are, we will face this type of disruption. So analysing one of each and... and try to find actually an alternative to... to become more resilient and have more resilient supply chains, actually is something that might be beneficial.

00:10:36
Deborah Sumter: So I was wondering whether the learnings that you had from analysing COVID as a disruptive event when it comes to global supply chains and the learnings that you had from how to make supply chains more resilient, whether you could translate some of those learnings to the situation now looking at the conflict between Ukraine and Russia?

00:11:01
Glenn Aguilar: All right. Yeah I think that we can translate a few... a few ideas. So the first one, perhaps it's about the new dynamic that we're seeing in global supply chains. So, I mean, it is clear that in the past 30, 40 years we have this dynamic in which every country is very interconnected, because well, because of international trade, also the outsourcing. Right? This concept that actually I don't need to produce in my own land, I can produce elsewhere so that it's cheaper and just bring back the products. And suddenly you start to to see this, this discussion about regionalization reshoring, which means that actually, okay, we need to come back to bring the production back to... to our regions. And this might be for multiple reasons. Right. And one of.. one of the reasons it's what we discovered during... during our research is that this process of regionalization might provide more resilience. Right. I mean, you are more autonomous in your supply chain. Of course, you cannot disconnect completely from the world. You at some point might need raw material from... from different regions and so on. But still... I mean, it's a completely different it's a transforming world in that sense. And right now between these different... between these two disruptive events, with the COVID and also the current conflict, Russia and Ukraine, I, I would expect that actually the the discussion, at least from, from countries that are not directly affectedare on how actually they can come back t... how they can bring the production back to home. Right.

00:13:23
Deborah Sumter: So countries doing more of their own production as far as possible.

00:13:29
Glenn Aguilar: Exacltyl. And for doing so als these ideas about circular economy are quite important as well. Right. Because at some point when you have... when you have this economy, that that is more autonomous, you have to be more resource efficient and perhaps rely on materials that you wouldn't expect to use in the past. But right now, they're very valuable. So I'm thinking about things that you discard as waste and just bring them back to, to to the economy somehow. So yeah, I mean, that follows more discussion right now regarding the regionalization and also thinking about how to become more circular in... in the near future.

00:14:17
Deborah Sumter: Yeah. I was also wondering whether you can say more about the complexity of supply chains. So for example, is it the case that the more complex a supply chain gets, that it's more beneficial to yeah. To conflict between regions or countries? Or would that lead to more peace?

00:14:42
Glenn Aguilar: Wow, that's a very interesting question. Let me see. So. The complexity of the supply chain refers more to... to how many steps do you need to cover in order to achieve certain goods or service. Right. So the complexity itself doesn't give you any hint about the conflicts or the disruptions that might happen. And. Of course, if you have like so many variables, right? Like like so many steps in order to.. to achieve something you might have more risk on in terms that... I mean, you have more more variables that might be affected by something. And for disruptions, I mean, we're thinking about, I don't know, like geopolitical conflicts or. Well, the the healthcare situation with the COVID, but also you can think about natural disasters, for instance. So at some point, the complexity might give you like more variables. But on the other hand, the complexity also allows you to.... to be more... to be.... to be able to diversify your supply chain. So. I mean, these many dots or steps might mean that actually you have more... more places where to get certain raw material or certain goods that you need. And this one, in terms of resiliency, this diversity part is quite important because actually it allows you to be more resilient.

00:16:29
Deborah Sumter: Yeah. Then I have more questions about you as a researcher and how you stay in contact with society. So the podcast is called Outside of or Beyond the Ivory Tower, being researchers sitting within that tower. How do you stay in touch with society?

00:16:52
Glenn Aguilar: Oh, I wish to have more contact with... with society. Right now the way that I see it and I'm working a lot in education. So of course, the younger generation, it's something that I'm tackling right now, but still with knowledge, right? Sometimes I know that as a researcher and academics, we might become a bit abstract in our ideas and. Yeah. So yeah, it's the biggest contact. Also I tried to, to be active in, in social media. But I have to say, this is a big challenge for me. As an introvert it's not very easy to... to express yourself and find the words. And, well, it requires a lot of energy from my side to.... to develop it. But still, I'm I'm trying to do it. Apart from that, yeah, I have very limited contact with.. with the public.

00:17:56
Deborah Sumter: What do you think that an important development would be like within your field, your research field, in the next ten years?

00:18:10
Glenn Aguilar: Well, something that you can see with the alliance already is the... the transition towards a circular economy. I think that has been a topic for well for the... for the past couple of years. And it's something that they will definitely evolve in these ten years. And it's very excited to think about these ten years, because also we have the the Sustainable Development Goals and they were set by 2030, right? So this is going to be in the coming eight years. So we're talking about the same decade. And so what I would... what I would like to see and I'm definitely looking forward to see from... from.. from the alliances, is actually how to link the circularity transition and the combination with the Sustainable Development Goals? And I know that there are a lot of researchers and well such a great team behind and I'm pretty sure that we will see very exciting outcomes and, and things that might help society in that sense as well.

00:19:23
Deborah Sumter: And are you also thinking to contribute to what you would like to see? Are you also doing projects that are related to a circular economy and that you would like to kind of combine or connect more to the Sustainable Development Goals?

00:19:38
Glenn Aguilar: Yes, definitely. I'm really excited about one project that... that I am trying to propose and it's to look into the circular. into the circular economy more from a global perspective. So as I mentioned, well, that was something that I kind of did in my PhD, but we're missing a lot of pieces of the puzzle, I would say. So one of the pieces is regarding what happened with circular economy in... in emerging economies like these middle income countries that might have different aspects to consider in terms of circularity and also how we... I mean, well, there are two questions there. There are multiple questions, but the first one might be whether it makes sense to have a global circular economy. What might be the benefits of that and also how. I mean, if that is useful and helpful, so how we can do it, right? So looking into emerging economies is important because they're very linked to high income countries. Right. And high income regions. And that is something that I would like to have as a contribution, just to be understanding on how to to develop this circularity, but more from a global perspective.

00:20:57
Deborah Sumter: Yeah, we have a final question from the previous guest. That was Karel van den Berghe. He's an assistant professor at TU Delft, and he's looking into circularity within cities. So spatial planning and circular city development.

00:21:15
Karel van den Berghe: Ik denk dat dit onderzoek ongefelijk interessant en relevant is. En wat bij mij dan direct naar boven komt is de geopolitieke kant daarvan. En ik denk niet dat hij daarmee bezig is. Als dat wel zo is dan super, want het is natuurkijk vandaag een onderwerp van geopolitieke spanningen, he. Op z'm minst. Zelfs ruzies. Dus in hoeverre is het onderzoek is het onderzoe dat wij en ik zeg dan Nederland, ontwikkelen op die... in die computerchips. In hoeverre slapen we er ook in om die kennis hier te houden en vooral onze problemen-en dat is ook al normatief: Wie is ons? Wie is hij? Wie is hun. Maar goed. Misschien weet 'ie daar ook al antwoord op. In hoeverre slagen we erin om die kennis die we hier ontwikkelen ook vooral hier in te zetten voor de maatschappijlijke problemen die wij hebben?

00:22:06
Glenn Aguilar: I mean indeed something that we found in the literature was the geopolitical aspects. Right. So and when you think about semiconductors in terms of material, in terms of raw materials, we are thinking about silicon, we're thinking about arsenic, we're thinking about callium, just nameing some of them. So the mining of this material appears in. In a few places in the world, actually. So one of the big players, for instance, is China. So you could imagine... you can imagine that even if you want to become autonomous and have only the production of electronics within the EU or the Netherlands specifically, you will still need to depend on China because you need the, I don't know, the silicon in order to make the semiconductors that go into your electronics. So, yeah, these type of dynamics are, I would say, that are related. I mean, I'm referring more to a geographical point of view, the political part. it's something that we didn't tackle too much. But of course, it's very important and it's one of the variables in the system and something that happened is also that the places where you can find the foundries for semiconductors, there are only a few places as well. So there are some in China and one ones that are becoming developed.` Taiwan is a big player there as well. And yeah, I mean, indeed, that's something that is very interesting in this case study is that despite the diversity on the products that use semiconductors, the semiconductor itself, the chip itself comes from... from only a few places in the world. The aspects that might drive the policies regarding raw materials in general, it's about protectionism. Right. And what you want to do is to try to well, to have a society that is still works. It doesn't matter with which type of disruptive event you have. Right. So having I mean, just coming back to the question and the reflection on the geopolitical part. Well, that specifically the political aspect of it. Yeah, it's more about protectionism and on how each government can actually well satisfy their demand somehow.

00:24:51
Deborah Sumter: The next researcher is Daphne Truijens. She is a researcher from Erasmus University Rotterdam and she's looking into behavioural policies or evidence based policies and how to kind of nudge people into making more well, also making more sustainable decisions or contributing more to sustainability. What would you like to know from her?

00:25:19
Glenn Aguilar: So my question is, do you take into account the cultural aspects in your research? And if yes, how do you take into account the cultures?

00:25:30
Deborah Sumter: Yeah, well, Glen, thank you for being here in the studio. And I learned a lot of new things about supply chains, resilience and yeah, I'm really curious to see more about your research in the future. Also, circular economy and emerging economies. Yes. So thank you for being here.

00:25:51
Glenn Aguilar: Oh, thanks for the invitation. I really enjoy it. Thanks.

00:25:56
Deborah Sumter: Bedankt voor het luisteren. Kun je nou niet genoeg krijgen van supply chains. Luister dan seizeon 3 aflevering 1 met Ankita Singhvi en Rene Kleijn. Over 2 weken zijn we terug. Dan spreek ik Daphne Truijens en hebben we het over het beinvloeden van gedrag. Kunenn we langzaam richting duurzaamheid genudged worden? Tot de volgende Uit de Ivoren Toren.