The Supply Chain Crisis is an Opportunity to Reimagine Your Strategy
Posted by Scott Mortenson on Jun 24, 2022
It’s bad enough there are chip shortages, fiber shortages, hardware shortages and component shortages affecting the fiber optic industry. Now there’s another layer causing concern: a labor shortage.
Even if a magic wand were passed over the land and all the product scarcities were removed overnight, there’s a sufficient lack of qualified, skilled people to get it all connected and running. The material and hardware concerns are a sore point. Supply chains were already getting squeezed before COVID-19 raised its head. Then the pandemic all but ground production to a complete halt.
Now that factories are operating again – though perhaps not at full capacity – it will take time to get through the backlog of orders and shipments. Fiber build-out capacity is not keeping up with demand, delaying service provider network expansion. Consumers may see an ad touting a new fiber network, only to go online and discover it’s not available in their neighborhood yet. Part of this is certainly due to the material shortages, but a lack of skilled labor adds another speed bump to the process.
There are probably more than enough people to fill the roles needed to help connect the networks coast to coast . . . but training new workers takes time – anywhere from 6 months to 1 year. Some companies hire trainees, putting them through the necessary courses, basically paying them to go to school. The field work may not be getting done until the “students” graduate. While it is good to invest in people for the success of the company and the industry, it’s not a quick undertaking.
Alternately, the Telecommunications Industry Registered Apprenticeship Program is adding to the workforce, and others have partnered with local colleges, universities and trade schools.
So, between the supply chains not getting filled as quickly as demand would like, and the bottlenecks at the harbors and freight yards where material sits, waiting to get shipped and delivered, there’s not enough qualified people to get everything connected, powered and running.
AT&T, for example, had targeted 3 million homes for fiber rollouts, but fell short by 500,000. Small ISPs got hit even harder, reporting widespread delays, not only for fiber, but the electronics to run it – routers, optical network terminals, modems, etc. What was a 3-to-4-week delay turned into 12 weeks, with much of the 2021 planned construction pushed into 2022.
And it’s not just a fiber shortage haunting purchasing departments. Challenges in getting parts of all types – server equipment, switches, cables – made shelves less stocked than companies wanted them to be. While Fiber-to-the-Home is profitable and a big moneymaker for the companies providing it, if they can’t get the fiber and associated hardware to make it work, there are only costs.
Fortunately, as the Coronavirus loosens its grip on society and the workforce, and supplies start flowing again, the backlog and headaches will start to ease up. Planning and patience will take the place of pandemics and pressure. Yes, demand will continue to increase, always out-stripping supply capabilities, but at least it should be somewhat manageable, if not reasonable.
The shortage of pretty much everything may be another “new normal”, but at least it is a known issue. And although it’s not an ideal predicament, there is a light at the end of the tunnel. Approved Networks is fortunate to not have all our eggs in one basket, as we utilize several reliable custom manufacturers to keep the supply chain moving. Transceivers, DACs, AOCs, cables, passive WDMs, rack mount sliding panels, MTP cassettes, adapter plates and more keep our customers up and running.
We may not have the solution for labor difficulties, but we’ve got the products for your fiber optic network needs.