Last year I wrote about global shipping and delivery bottlenecks causing havoc on global supply chains.
But will 2022 be the most difficult stretch yet?
With the Omicron variant causing crippling staff shortages, transport issues, the unpredictability of a broken supply chain, and a lack of the financial support that was made available in 2020 and 2021, we are now looking at prolonged supply chain disruptions (which some experts were saying were starting to abate)¹.
Many nations that ship Australia its goods are either dealing with low vaccination rates or COVID-19 outbreaks.
In China, it’s both— outbreaks of the Omicron variant and a vaccine that’s far less effective than the Pfizer and Moderna versions are complicating the nation’s availability to keep workplaces open.
The arrival of Omicron has provided a timely reminder of the unpredictability of the pandemic. The emergence of new variants during 2022 could accentuate some of the current pressures. In this context, China’s continuing zero-COVID strategy with its tight border restrictions could create even more problems.
Despite some easing in recent months, international shipping costs are likely to remain high in 2022.
The six primary factors we’ve identified that are contributing to the current bottlenecks in the supply chain:
- Port backlog
- Truck driver shortage
- Chip shortage
In short, we can’t expect a swift end to the supply chain crisis. It is likely that different industries will experience both shortages and over-supply problems throughout 2022.
The ongoing coronavirus pandemic has disrupted demand and product supply, which has led to imbalanced supply and demand. But while the pandemic has brought on supply chain problems, other contributing factors, such as the increasing use of chip-based products and intensified demand, won’t be going away when the virus becomes less of a threat.
As The Economist neatly put it recently, “the era of predictable unpredictability is not going away”.
Disruptions in the supply chains are expected by CEOs this year, with only 17% expecting improvement and 31% saying it will be no different from the turmoil experienced last year.
Global PC demand has surged to its highest level in a decade and the surge still has a way to go. According to IDC every segment in the supply chain has been impacted across multiple industries because of widespread component shortages, overburdened production capability and ongoing container shortages.
The shortage of semiconductors has affected various industries across the globe. Lopez Research said the semiconductor industry is facing a “perfect storm” of demand and supply at the moment which is unlikely to be resolved anytime soon.
In fact, component shortage across industries and segments are expected to continue throughout the calendar year.
With global shipping prices still high and workers in major factories still facing outbreaks and restrictions, demand for many products has exceeded capacity.
And in an era where we have become accustomed to shopping convenience and speedy deliveries, people are being made to wait months for products or pay double.
Business has to be resilient and capable of adapting to major disruptions so that it can develop long-term strategies and solutions to these complex challenges. In the meantime, shoppers are likely to see higher prices, with companies passing on increased shipping and other logistics costs to customers.
As ever, effective leadership in business is paramount. But strong leaders need to be thinking beyond the pandemic. Business leaders need to focus on changing inventory practices and supply arrangements.
So how do they navigate a future filled with uncertainty?
There are many strategies companies can use to bolster their supply chain strengths, the need to create resilience and the need to create options and flexibility has never been more critical than it is now.
Adapt and be open to change. Solve problems creatively. Foster innovation among the workforce.
Maintain the dialogue with your suppliers.
At ThingsAt, our goal is to maximise supply usage and reduce backlog while streamlining our processes and workflows or greater efficiency.
We are using all the resources available to us to deliver optimum outcomes for our clients and one key area we can help with is device management.
If your business needs new devices or has planned a device refresh in 2022, you will struggle. We’d recommend undertaking a device audit so that you only replace what you need to replace.
As an HP Power Services Partner we are able to offer HP TechPulse – a cloud-based telemetry and analytics platform that aggregates critical data from devices and applications, putting deep insights at IT’s fingertips to predict and resolve device issues before they impact employees.
HP TechPulse provides AI-driven insights that enable IT to make decisions on delivering the right devices, software and services to employees at the right time.
HP TechPulse reporting resulting from proactive device monitoring drastically improves device management visibility. All device insights such as software performance, CPU/memory usage, and device utilisation can be viewed at a glance on the HP TechPulse dashboard. It allows IT to rapidly respond to failures, and to predict and alleviate problems — such as a battery or disk failure — before they occur, which means the company can take pre-emptive measures, such as backing up data or replacing a battery before performance declines.
Contact us today about our ‘Device Audit Discovery and Recommendations Plan’ so you can optimise your fleet and get it working for your business.