Categories
Electronic Components

Procurement executives concerned about digital innovation

Manufacturers are using digital advancements to battle current supply chain disruptions.

Almost all (97%) of those surveyed said they had significant disruptions in their direct materials supply chain.

67% said they were not confident that the technology can cope with the current or near-future challenges.

The most significant technology disadvantages seem to come with lack of visibility into supplier, ‘disjointed’ source-to-pay process with multiple systems, and a lack of spend reporting.

Even more (87%) said modernising the manufacturing procurement and supply chain takes precedence, and it is their biggest challenge yet. A further 92% said avoiding disruptions to their supply chain is their main goal for this year.

The main issues

Among the main concerns for modernising the supply chain are potential disruptions during implementation, skills shortages, and scale and challenge of change management.

Around half of those surveyed (44%) predicted that the supply chain crisis would begin to calm by 2023. Significantly less (18%) thought it would reduce by the end of this year.

The study surveyed 233 senior procurement executives from US and UK manufacturing companies. It was commissioned by Ivalua, a spend management cloud provider.

See the original press release from Ivalua here.

Analysis

While Covid-19 was seen as a factor in the supply chain instability, it was not the only culprit. Global supply chains had already been in a vulnerable position, partly due to factors like too much outsourcing and an overreliance on ‘just-in-time’ supply management.

What some are calling ‘outdated technologies’ are slowly being replaced in Industry 4.0. However, the implementation of tech like IoT, AI, machine learning and cloud computing is not a quick process.

The issue may be that this transition period would only further add to the current shortages rather than solving them in the short-term. Most companies are being deterred by this potential loss, and have been avoiding the change for as long as possible.

Whenever digital innovation comes, it will be a gradual and time-consuming process, but businesses will be better off for it.

Categories
component shortage

The global electronic component shortage – what happened?

Arguably the biggest ongoing crisis in the tech industry is the global semiconductor shortage. You can’t go far online without seeing news about it, and many people have seen it firsthand when trying to buy a brand-new car, or a recently released games console.

When did it start?

The obvious factor contributing to the shortage is COVID-19. The virus infected millions and sent the world into lockdown, which then led to the housebound masses logging in and going online.

At the start of lockdown in March 2020, 60% of 18-24-year-olds were increasing their use of home delivery instead of leaving the house. Amazon’s revenue also rose at a quicker pace than in previous years, with the company making $88.91 billion in Q2 2022.

Alongside the increase in online shopping came an increase in other digital activities like PC and console gaming. In the last quarter of 2020 desktop, notebook and workstation sales rose to a record 90.3 million units. Tech company Sony saw 25% of its revenue come from game and network services, and around 18% from electronics products and solutions.

In another case of bad timing, both Microsoft and Sony were about to release their next generation of game consoles, and Nintendo Switch sales were booming. All of this meant demand for components was skyrocketing.

This then led to delays in car manufacturing. Why? Because all the available chips were being bought up by computer and electronics manufacturers, so there were none left for the automotive industry. A car part may need between 500 and 1,500 chips, and are used for many parts including the dashboard display and to control the airbag.

There were other elements that contributed to the shortage before this: The US and China had been imposing increasingly high tariffs on each other for the past two years, and natural disasters and fires took out several factories in Japan, Taiwan and China.

When will it end?

The comeback from the semiconductor shortage will not be quick. Some factories that were shut down by natural disasters are still repairing the damage and trying to reopen production. But as the demand is staying high, there will need to be new facilities created to cater for the increase in demand.

The time, expertise and money needed to start a new factory will be too much for smaller firms to manage, so then the hole in the market needs to be filled by larger corporations like Intel and Samsung. Both companies currently have plans to open new fabs in America, but it will be a while before they can start production.

Intel’s ambitious plan to construct the one of the largest chip factories ever in Ohio would alleviate demand, but is not due to start production until 2025. Similarly, Samsung’s Texas fab will not be operational until 2024.

Despite smaller factories opening, the substantial backlog will not be solved by these alone. There will need to be a combination of an increase in production, time efficiency and, with the pandemic in mind, automation to decrease person-to-person contact. There will also need to be a stock of chips manufactured to avoid shortages in future.

Europe and America have both put an emphasis on increasing their domestic chip production in the next decade, in the hopes that this will prevent importing issues in the future.

The speed at which technology is currently being developed also puts manufacturers in a tight spot. Not only are more electronic devices being produced all the time, but the technology of the components within them is also advancing quickly.

While it is difficult to forecast entirely, experts say the shortage could last a few more years. Hopefully, with the opening of the larger plants estimated for approximately the same time, the chip shortage might be mitigated by 2025.

We can help

The market is currently just as competitive in the case of other electronic components, but Cyclops can help. With our extensive stock of day-to-day and obsolete components, we can supply you when others cannot.

For all your component needs, contact Lantek today at sales@lantekcorp.com. Or submit a rapid enquiry through our website.

Categories
Technology

5G Technology and drones – The future taking flight

The last decade has seen the commercial market for drones explode. The global drone market was estimated by PWC in 2016 to be worth just under £100 billion ($127bn) and that was 4 years ago, before the emergence of 5G technology.

Rapid advancements in the propulsion, navigation, sensory and battery systems that power drones has brought about the likes of drone delivery services, aerial photography, and a new way to conduct mountain search and rescue operations.

These varied examples of drone applications perfectly illustrates the real usefulness of drones. Key to their adoption has been lithium-ion batteries that charge rapidly and better navigation systems that enable pinpoint control.

However, as drones have been increasingly adopted, our data transfer needs have increased and 4G technology has been shown up to be less than ideal.  

The need for 5G

5G can theoretically reach speeds of 10 gigabits per second and it is expected to reliably offer 1 Gbit/s to 2 Gbit/s in a few years.

This is much faster than 4G. For drones, it means faster data transfer and data collection, enabling real-time analysis and access to big data files quickly.

However, while much has been made about the increased speed of 5G over 4G (it is up to 100 times faster than 4G) the real value for drones is the lower latency.

Latency is the lag that occurs when resources are requested over a network. For example, you might wish to check wind speed when flying, but when you request the data, it takes a few seconds to load. This delay is caused by latency across the network.

Latency for 4G is around 30 milliseconds, whereas with 5G it’s below 5 milliseconds. In a best case scenario, the latency can be 1 millisecond.

This latency improvement is massive for drones. It makes reliable live view and live streaming possible. Real-time footage becomes a reality. Load times become imperceptible and responsiveness increases between devices.

Another area where 5G benefits drones is the 5G New Radio interface, which enables a higher number of devices to be used in one area over a wave spectrum. This means more devices can be controlled to reduce congestion.

Meeting demand for 5G component sourcing

5G is an exciting technology but it is still in its infancy, and up until now drone architecture has been designed around 4G.

5G requires different components to handle the speed increase and demands placed over the network. Drones need a new architecture to transfer data in milliseconds and transmit high-definition footage in real-time.

In short, the current technology has to evolve.

Sourcing components like ESCs, flight controllers, GPS modules, receivers, antennas and batteries for 5G drones will become more challenging as more players in the market start to evolve their products to meet demand.

Day-to-day component sourcing will require good contacts in the industry just as it always has. But the race to 5G will accelerate demand and increase competition. This is where the value of an electronic components distributor like us comes in.

We can supply active, passive and electro-mechanical components, including 5G components, working directly for you to procure the best components at the lowest prices. If the future is 5G, we’ll help you meet it.