At Drummond Bridge, we have been reaching out to our network to ascertain views, impacts, and lessons from the current COVID-19 pandemic. We are delighted to share the views of seasoned Supply Chain Director Colin Hughes who recently joined Current Health. Current Health is a patient monitoring platform that combines vital-sign sensors, connectivity, and telemedicine capability into a single platform. This fantastic wearable technology can be placed on patients at risk of COVID19 either in hospital, or at home.
With over 25 years’ experience in Supply Chain, focused mainly in large scale Global Electronics Manufacturing Services arena, we asked Colin on his views on the current situation and potential impact on supply chains, as well as his thoughts in general on transporting materials and consumables, as well as any potential positives to arise from the crisis.
With Current Health’s proprietary hardware manufacturing being outsourced, we rely heavily on our EMS partners to manage continuity of supply and maintain close collaborative communication to understand the challenges. These challenges have evolved very quickly over the last three to four months where, at first factories were stopping output and reliance was on existing inventories in the chain to fulfil demands, through to these being quickly exhausted, in certain commodities, due to sharp demand increases driven by products supporting the crisis efforts.
To compound the challenges further, carrier capacity reductions, due to border and transportation restrictions, has meant changing our expectations of transit times. An example we have experienced is being informed you goods are booked to ship on a certain flight does not necessarily mean the flights will actually depart on said day or at all. This reduction in transportation capacity then backs up the port/dock throughput which has already a reduced capacity with social distancing safety measures in place for workforce. Add on the physical space to accommodate this backlog then you realise the scale and the time needed for things to normalise.
Whilst today many component supplier factories are resuming production, particularly across Asia, it will take a number of weeks for inventories to fill up. This will be a relief of course, however, allocations of said inventories will continue for some time. Whilst high volume sectors such as consumer/mobile, automotive etc. are either ‘low or no’ output currently, the desperate need for ventilators is taking up much of the inventory and fresh supply across several commodity groups in the electronics sector as well as the very sudden spike in computing to support the remote working explosion. Major component OEMs are focused on ensuring their products are going where needed most, so unless you have class one or two (one being frontline critical and two being essential support/care) status for the products, then in the supply chain, we are experiencing extended lead times.
I believe supply disruption will continue to be uncertain even beyond the peak demands of products supporting the pandemic. Who can accurately predict how fast, if at all, thing come back to pre-coronavirus norms. If it’s a strong bounce back, then consumer confidence may drive demand to another peak just as we see relief from the COVID19 challenges. Whilst social and leisure sectors appear to be at the tail end of any lockdown/restriction lifting, what people choose to fill the void could well drive strong consumer demands in automotive, fashion, consumer electronics, home improvement, etc.
There are of course other general challenges: Is your normal contact point actually reachable? If not, and your supplier/assembler/factory has a breakout then what can you do?
I will keenly be interested to see what we will have learned on the other side of this crisis in many aspects of the industrial infrastructure of the global village! There appears to be a growing appetite to have a ‘Made at Home’ conversation. Could this really become viable?
One huge positive to arise from this global crisis is the strength of human will and spirit to overcome these challenges and the drive to be successful. Self-interests and motivations have dwindled and replaced with an energy and appetite to contribute.
Colin Hughes , Supply Chain Management at Current Health
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