Chip demand by revenue in 2020 (US$ bn)
“The crisis may actually be the greatest shock to supply that the semiconductor industry and its customers have ever seen.”
Jim Farley, Ford CEO
Far from a short term issue, it is likely to persist for years rather than weeks or months, and the sense of urgency is only just emerging. Additionally, trying to understand and remedy the short-term crisis has shone a light on some of the more fundamental flaws in the overall industry supply chain.
Richelle Wiley, COO of Workz Group, explains how and why the current situation arose, the impact on telecoms operators, how they can adapt, and the longer-term market outlook.
How did we get here?
Is there a crisis?
Semiconductor manufacturers by market share
Chip lead time: before and after COVID
How are telecoms operators impacted?
Everyone’s taking a hit
What should telcos do?
In addressing concerns of increasing price and stock outs, we recommend some specific actions for operators to minimise end user impact in the short term and achieve tangible operational benefits. These include reviewing product specifications and qualifying additional modules to have access to more tested chip options that are fit for requirement, and building inventory banks for up to 4-6 months of supply due to expected delays. We also recommend working together with us as we offer guidance to help you develop advanced demand planning strategies and capabilities to ensure stock outs are avoided and products always remain in supply.