Condense all the strength that can be condensed

A key factor in the “supply chain offensive and defensive war” is time. In the extended timeline, old controls will weaken and new controls will emerge. The advantage of the original connection will be attenuated, and the connection of the new supply chain system will be strengthened. Two forces against the beat, fight is the growth acceleration.

USC329AE01 In terms of control, the United States hopes to use external forces to establish a “less Chinese” supply chain alliance. The alliance is not invulnerable. Multinational enterprises have their own concerns, commercial interests lead to obvious cracks in the middle, and their strategic determination is also suspicious.

The United States established the “cut-off alliance”, participating in the semiconductor equipment sanctions are Tokyo Electronics and Nikon, the Netherlands ASML, as well as the United States Applied Materials, Pan Forest and other companies. These companies have a high degree of similarity in etching, settling and other equipment, and Nikon also competes with ASML in mid – and low-end lithography machines. Their products pose a complex competitive relationship, and both are highly focused on the Chinese market: Japan’s Tokyo Electronics has one-third of its sales in China; Nearly 25% of Fanlin’s market is in China; Asml’s mid-end lithography machines account for more than one-third of the Chinese market. In a highly dependent user market, the alliance relationship for the purpose of banning sales is fragile, as long as there is an unequal proportion of sales phenomenon, the “broken supply alliance” is easy to break.

USC329AE01 This is the meaning of time. Chinese enterprises are also waiting for changes in the situation while breaking through technology and fighting back with efficiency.

It is basically impossible for China to achieve complete self-control of the whole chain, and it is also impossible for multinational enterprises to form a comprehensive blockade of China’s supply chain. Made in China needs to unswervingly interweave the domestic supply chain with the international supply chain, and gather all the forces that can be gathered to weaken the force of the blockade.

This requires a balanced approach, looking at risks and opportunities along the entire supply chain rather than at individual nodes.

The formation of linkage lies in closer links between supply chains. The formation of control requires efforts at both ends, including knowledge feed-back from back-end users and energy transmission from front-end scientific and technological innovation. Design power superimposes the power of industry and country.

USC329AE01 While choosing to gain control, it is necessary to design the resultant force of the system. Small and medium-sized companies that specialize in making breakthroughs in a single technology are receiving extensive support. Since 2011, China has started to cultivate small and medium-sized enterprises with special skills. These companies seem to have been overlooked by the US, which has focused more on large scale enterprises. Force Distance Times, an American industry research magazine, has published a report “Little Giant” and “the challenge of a Single champion”, which believes that China’s precise industrial policy and unparalleled ability to cultivate have sounded the alarm for the United States. This, the magazine argues, provides a perfect window into how “advanced, sophisticated and comprehensive” China’s industrial policy is. By supporting specialized small and medium-sized enterprises, China is creating an asymmetric competitiveness.

It is worth noting that better supply chain design is needed to protect the long-term viability of these specialized, innovative smes. Leading companies and those in the supply chain need to establish strategic partnerships and even conduct joint research and development.

USC329AE01 Only when the supply chain innovates synchronously can a decisive breakthrough be achieved. It is necessary not only to use a longer period to plan a country’s industry, but also to build a soft power escort. The volume of made in China looks large, but the industrial security system behind it is relatively weak. To enter the middle and high-end value chain, China’s manufacturing must have a healthy industrial system behind the guarantee, it is far more than a company can do. As far as the industrial system is concerned, there must be a quality, measurement, testing and identification system, as well as intelligence agencies, standard systems, research institutes, and university science and technology transformation back to the main battlefield of application. Reshaping China’s industrial system is a comprehensive supply chain encirclement.

“Supply chain attack and defense war” is a protracted war, which is not a stress response in the face of challenges, but in order to be more conducive to self-development. We cannot replace calm thinking with amplified emotions, we cannot replace systematic thinking with local thinking, and we cannot replace basic breakthroughs with applied research and development. Supply chain competitiveness is not only the joint force of all supply chain nodes, but also the sum of a country’s manufacturing capacity.