In an average year, 134 strong earthquakes (magnitude 6.0 to 6.9 on the Richter scale) and 17 major or great earthquakes (magnitude of 7.0 or greater) take place around the world. Although many strike remote and less-developed sections, some hit major centers of economic activity. When they hit, they expose the vulnerability of global supply chains.
So begins Chapter 2 of “The Resilient Enterprise” by Dr. Yossi Sheffi, a professor at the Massachusetts Institute of Technology. The book was published in 2005, a few months after Hurricane Katrina struck New Orleans and a year after an earthquake triggered the deadly tsunami in Indonesia. Interestingly, the very next section of the chapter talks about the magnitude 7.2 earthquake that struck Kobe, Japan on January 17, 1995. In addition to killing about 6,000 people, the earthquake “damaged all of the transportation links in and around Kobe” and the port (the world’s sixth largest at the time) was “virtually destroyed…halting one-fifth of Japan’s export and import activities.” Dr. Sheffi goes on to write that “The full impact of the Kobe quake, however, would not be felt until days, weeks, even years afterward.”