This article is part of a series about the automation supply chain. Read more on the topic here.
Similar to their clients and users, system integrators have been severely impacted by recent supply chain stretches and snarls, and have been forced to rearrange their projects and schedules.
“We’ve taken massive hits to our supply chain and are struggling with them. Two years ago, it was common for automation hardware to ship in a couple of days. Now, we may have to wait months or a year for any top automation component,” says Logan Terry, client success manager at Grantek, a CSIA-certified system integrator and business consultant with offices in the U.S. and Canada. “We see no end in sight, but it’s likely to get worse before it gets better, so it’s causing a lot of stress for us and our clients.”
Previously, when Grantek had capital expenditure (CapEx) approvals from clients, its project list could usually be executed during summer shutdowns or at Christmastime. “In the past, if orders weren’t in by the beginning of May, then it was very unlikely that a summer project would get done,” explains Terry. “Now, if orders that aren’t in by May, then a Christmas project won’t get done either. In addition, many projects were shut down due to COVID-19, and now clients want to open up and start them again. However, they can’t due to long wait times for hardware.”
Terry reports that Grantek employs three main methods to keep its system integration projects going despite today’s supply chain delays:
- Increased upfront design and planning begins with creating a custom strategy based on each client’s knowledge; assembling a procurement list for their projects regardless of when they’ll actually be done; and developing a “predictive procurement plan” much sooner. This enables Grantek and its client to be ready when a project gets underway nine or 12 months later.
- Interact with a more diverse group of hardware platform vendors to evaluate potentially using comparable technologies or suppliers with shorter lead times without compromising a project’s design or performance requirements.
- Beyond individual projects, work with clients on more overall facility management and maintenance issues. A client may know what critical parts it needs in the short term, or rely on its distributor. However, neither may be fully aware of which devices are likely to fail in eight months and can’t be procured in time.
Because it’s a full-service system integrator that sprawls across all types of processes, Grantek designs and implements control systems, process and packaging automation, industrial information technology (IT), and enterprise resource planning (ERP) and management execution systems (MES). As part of these projects, it also installs and configures PLCs and variable frequency drives (VFD), network switches, server devices and other components, which have been hard hit by supply chain delays.
“Server hardware previously took a couple of weeks or a month to arrive, but now their lead time is 13-14 months,” explains Terry. “This means we have to coordinate much earlier. Grantek has been in business for 40 years, so we have many distributor partners, and we can often reach out to 12-13 of them to see what components or alternatives might be available and/or coordinate to fill orders more quickly. The problem now is that no distributor has a full stock of parts, so we had to develop a project strategy with more upfront design and planning ahead, and help our clients be very aware of these situations. This is the biggest piece in keeping projects on track and maintaining trust.”
To increase awareness and enable procurement further into the future, Grantek offers a “critical spare assessment” program, which includes visiting a client’s facilities, checking their equipment, putting together an asset list, identifying critical items, and determining what they should retain or keep in their warehouse, so they won’t be caught unprepared later. “If users wait until they need many of these items, it may already be too late,” adds Terry. “This is why it’s better to order and receive them now or as soon as possible, especially because of all the recent supply chain problems.”