Since the onset of the COVID-19 pandemic, global industries have grappled with supply chain issues, product shortages and Force Majeures. Planning for digital transformations, expanding data processing and storage capabilities, and refreshing general IT infrastructure have been significantly impacted. At the time of writing, there’s no clear end to these challenges.
IntraLAN, an industry leader in enterprise-level IT, technology and critical network provision, acutely understands business leaders’ challenges when planning IT-centric initiatives. To help facilitate your IT plans, Andy Horn, IntraLAN CEO, explains the top four ways to manage supply chain pressures.
What is causing supply chain issues?
Before explaining how to navigate complex supply chain pressures, it’s essential to understand what is causing delivery delays and hardware price increases. Depending on the industry, issues affecting supply chains may be different. For the purpose of this article, we’ll examine those affecting anyone buying IT and technology services, solutions and infrastructure.
COVID-19 was the initial catalyst that triggered a cascading effect of supply chain issues, including:
- Increased raw material and component costs
- Global problems, such as the war in Ukraine, Brexit and shipping container shortages
- Worldwide labour shortages
- Superconductor chip shortages
- Extreme weather events
In addition to these, specifically impacting data centres and businesses reliant on storage capacity for scalability, is the news of a massive 8% product loss when Japanese NAND announced contamination at two of its facilities.
These contributors have created what industry experts define as a ‘black swan event’, an unpredictable situation with potentially severe consequences – effects we’re only truly seeing now.
Four Ways to Manage Supply Chain Issues
As we deal with ongoing supply chain issues, businesses will inevitably deal with disruptions at some point. No two companies will be impacted in the same way, but understanding the situation and preparing for any eventualities will ensure your business is ready for when or if supply chain issues make their way to your business.
1. Communication is Key
Crisis communication is different from your everyday customer comms and supply chain problems are a crisis. If you’re responsible for IT within your business, you must convey consistent messaging across all forms of communication, including to other business stakeholders, employees, customers, suppliers, shareholders and the media.
It’s essential that your business is honest and transparent about challenges, how your business is tackling them and what customers can expect. Whilst no one likes receiving bad news or passed-on costs, complete silence is deafening and can irreparably harm your brand well past the end of the supply chain issues.
2. Experts Make the Decisions
This one might be a hard pill to swallow for the C-Suite, but it is essential to business longevity.
Decisions about component or product alternatives or changes to installation or manufacturing should be micro-decisions made by experts in their fields – not just CEOs or C-Suite execs. Experts know what changes can be made to implementation and infrastructure that won’t impact service levels or product capabilities. Choosing the wrong components or making a reactive decision could lead to detrimental impacts.
For example, over a decade ago, after the Fukushima earthquake, tsunami and nuclear meltdown in Japan occurred, a shortage of components required to make heated seats for General Motors’ vehicles crippled the industry. The Japanese VP of General Motors decided to build the seats without the component in place, causing further issues.
The experts who design and install these products would have been invaluable in creating a contingency plan that wouldn’t have led additional problems.
3. Analyse Your Supply Chain
Complete supply chain visibility will be integral to your business’s long-term plans as supply chain issues persist.
We suggest mapping out your entire supply chain and the risk exposure towards your IT, including:
- Who are your suppliers?
- What do they manufacture or provide your business?
- If they aren’t a manufacturer, who is their supplier?
- Where are your suppliers and their suppliers located?
- How critical are their products to your business’s bottom line?
- What are their inventory levels?
Supply chain visibility also includes quality control of the products you manage to receive from your suppliers. As component shortages continue, you may find quality degradation of finished products or longer delivery times, both of which can negatively impact your business if you’re unprepared.
Even if your suppliers are delivering on time and the quality is to your standard, it is essential for IT planning to ensure you’ve researched alternative suppliers and have contacts with them should you need short notice support.
4. Plan for the Future
Whilst we’ve been under long-term supply chain shortages, it’s vital for companies to view this as a short-term objective and focus on long-term business continuity. Whilst supply chain issues will be at the forefront of your agenda; you should also concentrate on:
- Employee well-being and reward system
- Flexible working, including part-time and remote or hybrid arrangements
- Alternative suppliers, workflows and products
- Developing your business to be more lean and agile, allowing you to respond to future challenges faster
- Customer experience
- Building brand reputation
Additionally, after examining your supply chain, now may be the time to rethink underperforming products and customers or organisational changes. Supply chain pressures are like recessions, they’re challenging, but we can come out of this crisis with a more robust, streamlined industry.
Customers will understandably be frustrated, though every business that sells or provides storage and processing-centric products will inevitably be experiencing the same things you are. Everyone in the IT industry is experiencing the same component and product shortages and lengthy delivery periods. The key to overcoming these challenges is through preparation and communication.
IntraLAN understands the challenges you’re facing. We can help ensure your business and its networks and systems are streamlined, dependable and secure through state-of-the-art IT, technology and telecoms and industry-leading SaaS and IaaS.
Contact our team to learn more about how your business can see success through supply chain challenges.