The Resilient Enterprise

Yossi Sheffi wrote this after studying how companies responded to disruptions including the 2001 attacks, the 2002 west coast port lockout, the 2000 Philips semiconductor plant fire and the foot and mouth outbreak. It established supply chain resilience as a management subject.

The analytical framework distinguishes the phases of a disruption: preparation, the disruptive event, the first response, the initial impact, the full impact, preparation for recovery, recovery, and long-term impact. Sheffi argues that most management attention goes to the response and that the decisive work happens in preparation.

The central case is the Philips fire, which damaged a chip plant supplying both Nokia and Ericsson. Nokia detected the problem within days through its own monitoring, escalated immediately, secured alternative supply and reallocated designs to available components; Ericsson accepted the initial assurance that the disruption was minor, discovered the truth weeks later, and lost a large share of the handset market as a result. Sheffi uses the contrast to argue that detection speed and organisational escalation matter more than any physical redundancy. He also covers the trade-off between redundancy and flexibility, the value of standardised parts and processes that permit substitution, the role of supplier relationships, and the observation that firms which build these capabilities gain competitive advantage in normal conditions as well. The book is practical and its central case has been taught ever since.