From cars to computers to baby toys to washing machines, semiconductor chips have become a crucial part of almost every electronic device present in modern life. For that reason, it’s no surprise that the current chip shortage has impacted virtually all industries. Leading electronic brands such as Samsung and LG have already reported delayed release dates as factories struggle to fulfill previous orders before accommodating new ones. Several reports attribute the shortage to:
- Unchanged demand for electronics during the pandemic. Automotive and appliance manufacturers greatly underestimated electronic demand, causing many factories to order less chips. However, the pandemic seems to have inspired more electronic purchases as people spent more time at home.
- Improper counts for incoming shipments. Most leading manufacturers employ just-in-time inventory management to avoid overstocking costs, yet in the case of semiconductor chips, just-in-time management can complicate order fulfillment for past orders since clients need to wait for parts to arrive before being able to purchase a wholly assembled product.
- Silicon shortage stemming from vaccine production. Lastly, silicon, which is a vital material needed to create chips, is currently in short supply since it is also used to produce vaccination vials used for the current COVID-19 vaccines.
The time to enhance operational visibility is now.
Because chip manufacturing and shipping involves many moving parts, supply chains must now focus on expanding communication channels and tracking systems to certify chip orders are properly received, used, and shipped within a timely fashion. To help our clients do this, SMG3 emphasizes the following three efforts:
- Automated Tasks – By automating workflows such as data capture and sharing, teams can decrease processing times, increasing throughput without overbearing workers. Modern enterprise-grade mobile computers exemplify this by streamlining data processing and scanning through one digital device connected to your centralized management system of choice.
- RFID Locationing – Real-time tracking of both inventory and assets prevents bottlenecks and surprise out-of-stocks as teams can monitor material quantities throughout the workday. Today’s intelligent RFID products can now track in-motion inventory, providing clear insight into just-in-time material delivery so workers can adjust workflows based on how much raw material is available.
- Increased Network Connectivity – To sustain communication within facilities, WiFi and network channels must function smoothly, especially during high demand seasons. Dependable network management systems ensure connectivity channels operate undisrupted, so changes within demand can be quickly communicated to all concerned teams.
To learn more about how SMG3 is partnering with manufacturers to navigate through the chip shortage, contact our modernization teams.