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Global Supply Chains and Human Behavior Converge During Covid-19 Pandemic

Shipping containers are staged for transport in Jakarta, Indonesia. Covid-19 has had sweeping impacts on the global supply chain, and psychologists who study human behavior are taking note. (Photo by Tom Fisk from Pexels)
Shipping containers are staged for transport in Jakarta, Indonesia. Covid-19 has had sweeping impacts on the global supply chain, and psychologists who study human behavior are taking note. (Photo by Tom Fisk from Pexels)

It has become a familiar sight in the United States, and around the world: bare grocery store shelves — especially in the toilet paper aisle.

The prevailing theory in the scientific community is that the novel coronavirus came from an animal host. If true, it would mean that a shared virus among species has led to at least one shared instinct among species.

“Our brains as mammals, and even in birds, exhibit this phenomenon that stress potentiates this drive to hoard — squirrels hide nuts, birds hide seeds. People also hoard when they think a resource that’s necessary is in short supply, especially in times of stress,” said Stephanie Preston, a professor of psychology at the University of Michigan.

“What you see is really a very natural consequence of people feeling stressed and uncertain and anxious,” Preston said.

This kind of hoarding can be seen with items like canned food, rice, pasta, and water, which are recommended by public health authorities for disaster-type situations. So, too, with comfort foods. But why toilet paper?

“Toilet paper is like the perfect storm for this situation,” Preston said, citing the pervasive fear of contamination, which triggers anxiety, which then leads to hoarding.

This type of behavior is found throughout the animal kingdom, according to Preston, who mentioned the example of kangaroo rats who will keep food in their cheeks, like a wad of chewing tobacco, when they feel scared from their surroundings. Preston’s research also suggests that hoarding behavior can be induced in small animals by taking their food during the night, causing them to react as if a neighboring creature had stolen it.

Though looking at empty shelves, in real life or on social media, can be unsettling, supply chain experts have reiterated that there is no shortage of food nor of toilet paper, the latter of which is mostly made in the United States.

The reason for the shortages is a phenomenon called the “bullwhip effect,” which is when the end of the supply chain, in this case, consumers at grocery stores, introduce massive changes in their buying patterns. This disruption then resonates back through all the parts of the chain, including distributors, manufacturers, and suppliers.

“By the time it gets it gets to the other end of the supply chain, it can be 10- or 20- or 100-fold worse, so it just creates these massive overages and shortages,” said Lisa Anderson, president of LMA Consulting Group, which focuses on supply chain performance. “But there are some things you can do to alleviate it.”

Anderson said a top strategy, which has been implemented widely, is for companies closer to the consumer to impose limits on purchasing certain items. For distributors and manufacturers, technologies that allow for real-time monitoring or inventory and demand can help them make better decisions about how to allocate resources.

While these strategies can help, Anderson said, ultimately manufacturers have to ramp up production in order to meet higher demand. Here, companies have a few options.

“They can do simple things like run overtimes, but if they have people who are sick that’s a huge problem, so they might struggle to have enough employees, and not just because they might be sick but because, for instance, their kids are at home,” she said, noting that it’s hard to add additional shifts quickly due to the need to train new people.

Anderson said that manufacturers will often look to fill this gap by reaching out to other companies who make a similar product, which might not be as much in demand, so as to hire their workers, or borrow equipment, on a temporary basis.

In the current environment, such moves are easier to make than in past disruptions.

“You’re either really busy right now or you have no volume,” Anderson said. “It’s a good time to collaborate.”

At the time of this interview in late March, Anderson did not foresee food or product shortages for domestically-made goods.

“There is supply. Especially with food, they’re continuing to manufacture and produce more. And also with toilet paper and things made relatively close by, they are going to produce more. Be assured there is going to be more next week, and sometimes even later in the day,” she said, referring to the fact that some sections, like the meat section, might only have 30-40% of their inventory on the floor.

Products made overseas, however, could make for a different story

Indeed, a dip in imports has already occurred. The Port of Los Angeles and the Port of Long Beach, which together comprise the busiest U.S. ports, experienced a 22.8% drop and 17.9%, respectively, in loaded imports in February 2019 compared to February 2020.

Because of the complexity of supply chains, to say nothing of human psychology, political decisions, and the course of the pandemic, it is hard to predict a date when grocery stores will return to normal.

“Everyone is trying to increase capacity, and prioritizing, but they’re not going to increase it to a never-ending scale beyond what they know their ongoing needs are going to be,” Anderson said.

While the scale of what is occurring on the supply chain front is unprecedented in her thirty years of experience, Anderson said the dynamics are well understood within the industry, and might catalyze a mix of old and new practices.

“I think in the future people will think about the advantages of local sourcing and manufacturing. You have more flexibility to do something quickly. Also, there could be more thinking about robots, which won’t get sick. I’m not suggesting we should have full robotic workforce, but they can maintain production.”

Even with the strength of the food supply chain, which runs contrary to the perceptions of many, Preston urged empathy towards others along with a realization that we tend to carry our own biases.

“Hoarding is a natural response to a perceived shortage, it’s not something to be denigrated,” she said.

“There might be cases where people have gone overboard, like selling items at very high prices with high demand, but that’s a very small number of people in the big picture. Social media is making them so salient, but it’s not representative. All the people who took a normal amount in their cart, you didn’t notice. You only noticed the person who tried to grab all the rice,” she said.

Short of fully stock shelves and a return to normalcy, she said hoarding can be alleviated in a couple of ways. One would be to reduce the source of tension, for example, by reassuring people about the ample supply of groceries —  as a counter to images of empty shelves. The other is to show who is being harmed.

“Altruism and empathy are evoked by direct stimuli,” she said. “It doesn’t work well as an abstraction.”

So while a lengthy, broadly-written note might not do the trick, showing photos of hospital workers who got sick because they did not have supplies is more likely to evoke a response.

“People are really very altruistic naturally,” Preston said.

“They are responding in an adaptive way and they’re doing the best they can. No one is trying to do harm and be malicious, on the average.”

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