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How Vertiv Is Managing Supply Chain Lead Times Through The Pandemic

How Vertiv is Managing Supply Chain Lead-Times Through the Pandemic

As we start to see businesses and industries open up to full-capacity production, we are hopeful that shipping and manufacturing lead times will decrease to a pre-Covid-19 margin. Unfortunately, that has yet to be the case.

While there isn’t a “freeze-time” on products, as we witnessed in April 2020, production times and shortages are still affecting equipment manufacturers and suppliers. Vertiv has been dealing with some parts and materials shortages and has learned to leverage their creativity to find solutions.

Vertiv’s CEO Sheds Light on Facing Ongoing Challenges

Vertiv’s CEO, Robert Johnson, said they had delayed previously planned programs for footprint optimization, which focuses on managing the supply chain constraints and inflation. With the limitation on the supply chain, data center suppliers must account for and plan for some components with a 52-week lead time. One of the most significant factors for this is the global chip shortage.

Luckily, the CPU supply is steady, as their demand and profit prioritize other industry subsectors. Silicon continues to see extremely long lead times, affecting network-switch vendors. Companies have been spending more time, energy, and money than accounted for while dealing with supply chain management. Even larger companies, like Intel and AMD, have had to make operational changes to manage and mitigate the CPU silicon wafer and components lead-time challenge.

The chip shortage is just one part of the supply chain crunch caused by the pandemic. Data center equipment suppliers find it hard to obtain enough fans for cooling equipment, lithium-ion batteries are harder to come by, and materials are in short supply.

Transitioning to a More Digital World

The pandemic has pushed most people to work, study, and play remotely, causing the demand for digital services to escalate. Even data center suppliers have had to learn and utilize new digital tools to continue efficient production.

With the transition to a digital space for business operations, Vertiv and other data center suppliers and manufacturers have maintained status as an essential business, allowing a steady albeit slower flow of production.

Vertiv’s CEO, Rob Johnson, boasts of Vertiv’s ability to meet production demands despite both supply constraints and Vertiv’s 20% year-over-year growth. With an emphasis on communication with their customers, Johnson says it’s a day-to-day process of creating solutions, planning around order times, and adding more suppliers.

Looking to the Future

Vertiv and our other partners are committed to our customers and helping them face the challenges of managing their data center supplies during this challenging time. We understand the importance of transparency when facing limited resources and management of supply chain constraints.

While the last two years have been challenging for all industries, we recognize what the IT industry has accomplished and the importance of communication, efficiency, and security across the world. We look forward to working with our partners to continue to provide the best knowledge, products, and services to keep your business running efficiently. Hear more of what Rob Johnson spoke of during his appearance on The Data Center Podcast.

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