We are all, I think, aware of the global chip shortage. Pandemic shutdowns and increased demand, trade wars, drought and a factory fire all contribute to a challenging production environment. REDTAIL has met these challenges head-on with lead from Terry Warwick our Supply Chain Manager, who has exemplified our core values of problem solving and partnership in meeting the demand of our valued customers.
REDTAIL Telematics devices for both Stolen Vehicle Tracking & Recovery and Usage-Based Insurance having around 760 components, all of which can be impacted by the global shortage. Terry (based in Cambridge) is in the office early each day to understand the very latest on component supply and pricing from our assembly partner in the Far East, and yes it does change daily, and it is rarely good news!
‘It is a game of 3D solitaire!’ says Terry; ‘and entirely unpredictable. I can receive an email with a particular shortage very first thing, which will set off a chain of detective work to find that particular part which is usually sorted out, but sometimes not always with a satisfactory outcome.’
REDTAIL has seen lead times quoted of as much as 60+ weeks; even 52 weeks is becoming more commonplace, and price hikes in the region of 10%. At times, the lead times have been unacceptable, in which case we turn to our design engineering colleagues to look at a change in specification to get around the absent component.
REDTAIL has enjoyed a 17-year relationship with our manufacturing partner Clarion Malaysia. (Please see my previous blog on what Partner means to us).
The honesty and transparency fundamental to that relationship has enabled us to move the pieces around (3D solitaire remember?) as we have found fixes for a particular component supply. Volumes and lead times have been flexed to the max, but throughout (I should say so far, this is not over!) we have sustained a positive dialogue, action plan and outcome. The last word should be with Terry:
‘Paramount, of course, is sustaining our customers’ businesses. They depend on us to fulfill devices (and of course valuable data from those devices) in support of policy or vehicle sales. We’ve been able to do that through the quality and determination in our approach.’
Well quite. Procurement is served by problem solving and partnership at their best.