NORTHBAY – Supply chain issues are not going anywhere anytime soon, the audience of a conference on rural and remote broadband held by Canada’s Rural and Remote Broadband Communities (CRRBC), heard today.
CRRBC’s conference featured several panels and talks, including a keynote speech titled Supply Chain in Crisis and the panel Rural Funding Project Deadlines and Supply Chain “The Perfect Storm”.
The keynote was given by Peter Collier, vice-president of technology products and solutions at Sci Group Inc., a Toronto-based logistics and supply chain company.
Collier kicked things off with a laugh, showing the audience a cartoon picturing two students walking, one telling the other “don’t tell them the dog ate your homework, just say there were supply chain issues.”
“I found that humorous in a number of ways, because for those of us who work in logistics and supply chain, we all realize that every day we’re constantly dealing with those issues and that our job has to address them – it’s not as simple as just saying oh, there’s a supply chain issue, we can’t do it” he said.
Collier noted it is interesting “that even with everything we’ve seen in the last two years, it shows how big the crisis is that even two students, fictitiously here walking along the street are going to blame supply chain issues… If only it were that easy for the rest of use to pass the buck.”
During the keynote, Collier talked about different supply chain-related types and levels of crises, including those that happen on a global scale, limiting the ability to forecast. This level includes what is happening now with the ongoing pandemic.
When dealing with this level of crisis, Sci has found it is important to have a framework for decision making that can be applied to whatever the problems are because “there’s obviously things that are happening now that never happened before or if they did, they happened with a different product or [were] maybe not as globally impacting,” said Collier.
Structure is important and setting guiding principles. There will not be an easily definable, quick answer, “but it’s an opportunity for everybody to at least put some principles down so everybody in the company can have a structure and a checklist that they can look at to say, this is the right thing to do in this particular situation based on whatever information’s available now,” Collier said.
He also talked about chip shortages, noting they have “seen people make decisions about types of products that are going to continue to get the chips, maybe using different chips, maybe holding certain products back depending on the timing of the year and where they are and obviously companies making adjustments to the type of designs that they include.”
These are long term issues, Collier said. “There’s no immediate end that we can see to when that’s coming to a close.”
Collier’s keynote more generally highlighted several supply chain-related issues Canada is seeing right now. This includes a reduction in the availability of commercial real estate, a reduction in the availability of labour and increasing pressure on wages, an increase in tracking and monitoring requirements, limited component availability, a competitive shipping environment and damage to infrastructure, for example to highways and bridges in B.C., due to extreme weather.
The panel following the keynote took up this topic of supply chain issues in Canada. It was moderated by Jodi Bloomer-Kaput (right), co-founder and chief business development officer for Canadian Fiber Optics and Northern Lights Fiber. Panelists included Collier, as well as Tim Emoff, vice-president of telecom and partner at Sales Outsource Solutions and Jerry Cederlund, senior vice-president of supply chain operations for Calix, who has experience in all parts of supply chains.
“There’s no doubt they’re ubiquitous,” Emoff said of supply chain issues. “But what makes telecom a little different and not to paint too bleak a picture is it’s almost a perfect storm.”
Telecom demand is exceeding supply. “You’ve got exponential growth in terms of broadband building,” Emoff explained. The backdrop to this is there are multiple funding programs in Canada including those from federal and provincial governments for building broadband networks. On top of this, “the elephant in the room” is the U.S. is at the same time dropping billions of dollars into funding for broadband builds as well, Emoff said.
There’s a robust market and you have “manufacturers that can barely keep up today because of all the supply chain issues. Peter mentioned the manufacturers are not able to ramp up quickly… the most optimistic prognostications have them ramping up towards Q3 and Q4 of next year.”
In addition to this, Emoff points out there are shortages of important raw materials such as steel tape. There are also transportation issues domestically and internationally.
What this means for telecom is “shortages, lots of shortages,” Emoff said. “It’s also meant price increases.” Because of this, forecasting is essential. “We need to forecast, you need to forecast,” Emoff told the conference audience. “We need to communicate what the needs of our network builders are going to be for the next, not just next year, but the next three, four or five years.”
Cederlund also emphasized the importance of forecasting in the face of ongoing supply chain issues.
“I’m placing orders for the end of 2023,” Cederlund said. “We’re using the forecast from you, statistics, the knowledge you have of big rollouts. Anything you can do to keep us in information, we’ll make sure that we roll that into the overall supply chain.”
Cederlund talked about the semiconductor supply gap. “The semiconductor industry is going to ship 1.1 trillion devices, chips this year and capacity is right now sold out through 2022,” he said.
“Lead time for new orders, if I were to order something new to that 52 weeks, minimum, 78 weeks sort of on the long end. And then I have to build it, test it and get it into the United States or into Canada. So, a very, very long lead time.” He indicated there may be some slight easing of this by the end of 2022, but he does not “see normalcy for possibly a few years.”
Image of Bloomer-Kaput is a screenshot taken during the virtual conference.
