In conjunction with ongoing efforts to help share supply chain management information related to the ongoing COVID-19 Coronavirus outbreak, we have called reader attention to recently released member survey research data from The Electronic Components Industry Association (ECIA). Members are noted as 6000 industry participants, 85 percent of which are located in China. Our previous blog highlight of this particular survey was published on March 17.
Supply Chain Matters is highlighting this particular data because component electronics are not only a supply network lifeline for high tech and consumer electronics manufacturers, but increasingly automotive, medical device and other equipment industries who rely on the supply of assembled electronic displays and other control components.
Last week, the association released results of the fourth survey on the ongoing impact of COVID-19, and from our lens, the data provides a real-world perspective on the pitfalls of supply chain risk response, and lack of end-to-end supply chain visibility.
According to the latest ECIA report release:
“Despite the exponential growth of Coronavirus around the world, this survey shows a major jump in positive expectations regarding the impact on the ability of companies to supply customers on time. There is a large shift toward “no impact” and “minimal impact” in all three component segments with the largest share of responses falling in these categories… In addition, the largest group now expects no disruption in the supply chain.”
At first glance, such news should be rather positive for the many supply networks that are dependent on consistent supply of electronic components and associated high tech electronics finished products. Especially since the conclusion of the prior survey had indicated that the largest number of companies with visibility on the supply chain expected the impact of the crisis to be moderate and the disruption to last until somewhere between the end of April and the end of May.
However, the statement that really caught our eye indicated that: “.. a large share of respondents continue to struggle with adequate visibility on the supply chain and are unable to quantify the impact of the crisis.”
That latter statement will more than likely ring true for many multi-industry supply chain teams, namely waiting for any shoes to drop from suppliers that are still assessing or unable to quantify supply impacts up to this point.
In the case of the latest ECIA survey, the blind spot is identified as semiconductor manufacturing participants, the lowest and most crucial tier of high-tech electronics supply networks. According to this latest release, more than 60 percent of this semiconductor group are still unable to assess the impact level.
Readers can access the data and conclusions summarizing this study at this ECIA Resource web page.
Supply Chain Matters Perspectives
As we and many other supply chain management media have reminded our community, the most significant lesson of the 2011 Fukishima tsunami disruption in Japan was the latent discovery of significant supply disruption at the lowest tiers of supply networks. Eventually, these suppliers did assess the impacts, and the surprises turned out to be single-sourced items.
In the case of electronic components, we certainly hope that history will not repeat, but the number of 60 percent lacking end-to-end visibility is a large yellow caution sign flashing, one that could be revealing in the weeks to come.
Time and continued persistence on the part of supply chain management teams will tell what the ultimate impacts will be.
Supply Chain Matters can certainly share in the optimism of few impacts, but indications of a continued lack of total visibility is often is an indicator that cannot be ignored.