Supply Chain Issues 2024: How Good Reliability and Maintenance Helps

Elizabeth Ruiz

Posted 5/22/24

Introduction

2022-2023 experienced a supply chain crisis caused by COVID-19, geopolitical issues, and mass labor shortages. (1)

What are the supply chain issues manufacturers are facing in 2024? What do these challenges mean for large operations? How can a good reliability and maintenance program help organizations ameliorate the situation?

ocean freight bottleneck; supply chain issue

2024 Supply Chain Issues

2024 is expected by experts to see some of the same challenges along with new ones causing problems in the supply chain.

Orkestra lists these 6 as the top supply chain risks for 2024:

Labor shortages: Labor shortages in one industry will affect other industries, so it is difficult to solve this problem for everyone. The labor shortage affects both production speed and speed of transport, for example.

Ocean freight bottlenecks: Ocean highway traffic can back up due to the labor shortages and shutdowns causing ports to operate beyond capacity. Along with these issues, the problems at the Suez and Panama Canals have had lasting impacts such as volatile freight costs. (2)

Increasing inflation: Labor, energy, and transport costs are all up, which is a big risk to the supply chain.

Global port congestion and warehouse shortage: Again, COVID-19 and labor shortages are the culprit, along with outdated infrastructure, contributed to bottlenecks at ports which pushed warehouses to capacity. Supply chain leaders are now scrambling for enough space.

Sustainability issues: Fortunately, new laws and regulations like trade embargoes are preventing companies to sell or source material in places where human rights abuses are taking place. There are also new climate crisis rules being established to reduce emissions. This has created a need for new and creative solutions for the supply chain.

Resurgence of COVID-19: COVID-19 is still a threat, and any new variations and the implications that may arise are a risk to the global supply chain. (1)

Supply Chain Management Review focuses on a different set of challenges:

Difficulties implementing new technologies:

Leaders are having a hard time figuring out exactly how to utilize new tech such as IoT, AI, and autonomous vehicles within the supply chain.
New technology means a new need for cybersecurity.
A strong change management process is needed for organizations when sorting out process changes, new roles and responsibilities, etc.

Lack of collaboration across functions and externally: More support and guidance is needed for collaboration.

Lack of governance/poor data management: Inaccurate data negatively affects an organization’s ability to effectively use analytics and automate activities, among other problems. (2)

On a Positive Note…

It’s not all bad news!

Although there is a learning curve among maintenance professionals, emerging technologies, big data, and advanced analytics being integrated into the supply chain strengthens foundational data and processes.

The potential supply chain issues have created a culture of preparedness, which can increase workplace safety. There is also rapid innovation helping to progress the field. (2)

There is a greater focus now on human rights issues and lowering emissions within the supply chain as a whole.

How Supply Chain Issues Affect Manufacturing

While the biggest consequences are felt by consumers, manufacturers of consumer goods are feeling the pain from supply chain issues as well.

Manufacturers rely on import/export processes to be on time, and the previously mentioned port congestion and closures contribute to supply line disruption. (3) Costs are up, which makes budgeting more difficult (4). Labor and material shortages also make it difficult to keep an organization operating at its best. Long lead times in parts delivery makes equipment repair difficult. (6)

So, what can be done? USC Consulting Group offers these solutions to common supply chain issues for manufacturers:

Diversify supply chains
Reshoring
Sales, Inventory and Operations Planning (SIOP)
Investment in employee training (5)

Orkestra has some ideas as well:

Reevaluate hiring processes, retention practices, and compensation, and focus on employee wellbeing and safety in the workplace.
Invest in new technology such as predictive visibility platforms, cloud-based solutions and autonomous technology – it’s time to lean into digital transformation! Warehouse managers should use Warehouse Management Software (WMS).
Collaborate and coordinate on scheduling for an easier time when bottlenecks occur. Standardize international freight shipping documentation.
Keep an eye on inflation trends. Multi-source the supplier base and apply strict contract time periods to help alleviate the problems related to sudden price changes.
Create solutions for sustainability issues that utilize AI-driven technology – and implement them. (2)

How Reliability and Maintenance Can Help with Supply Chain Issues

The long lead times and scarcity of spare parts make a well-established reliability and maintenance program essential in plants, mills, and mines today. Making sure equipment can run as long as possible without breaking, and fixing potential failures in equipment before they occur, can save a lot of money in repair costs and help maintain profitability. (6)

Three important parts of a motor reliability and maintenance program are to find existing problems and repair them before failure. PdMA (via IRINFO.org) suggests closing gaps in these three areas of your plant, mill, or mine:

Quality Control:

Don’t assume that newly installed equipment will run perfectly. Always test new equipment to ensure that it is operating properly.
Share data digitally and establish historical trends.
Properly store parts and components to maintain their quality and avoid infant mortality failures.

Trending:

Collect test data and analyze data trends.
Even with equipment that can measure data points, it is vital to invest in training or hiring qualified employees who are able to spot irregularities in data trends.

Troubleshooting:

Troubleshooting allows for quick diagnosis and repair.
Establish a detailed troubleshooting plan.
Include vendors in the troubleshooting plan – they are aware of potential problems that can occur in a piece of equipment or component.
The plan should aim to minimize downtime and find root causes to address and repair the problem as quickly as possible. (6)

Conclusion

In 2024, the supply chain continues to face significant challenges stemming from labor shortages, ocean freight bottlenecks, increasing inflation, global port congestion, sustainability issues, and the ongoing threat of COVID-19. These supply chain issues complicate operations for large manufacturers, leading to delays, increased costs, and material shortages. To mitigate these challenges, organizations can adopt strategies such as diversifying supply chains, reshoring, and investing in employee training and new technologies.

Moreover, a robust reliability and maintenance (R&M) program is crucial in ensuring the longevity and efficiency of equipment. By focusing on quality control, trending, and troubleshooting, organizations can identify and address potential motor failures before they occur, thus reducing downtime and repair costs. Embracing these proactive measures and innovations can help organizations navigate the complexities of the modern supply chain, ensuring resilience and sustainability in their operations.

Sources:

1. “6 risks in supply chain management to look out for in 2024.” Nick Murmann. Dec. 12, 2023. Published online by Orkestra.

2. Excerpt from “Preparing for 2024 supply chain challenges and priorities.” Marisa Brown, Senior Principal Research Lead, APQC. March 4, 2024. Original article published in the March-April 2024 edition of Supply Chain Management Review magazine. Excerpt published online by Supply Chain Management Review.

3. “The Ripple Effects of Disruptions on Supply Chains.” Seth Weisblatt, Director, TrueCommerce Home. May 6, 2024. Published online by Industry Today.

4. “How manufacturers can tackle supply chain costs in 2023.” Kate Magill, Manufacturing Lead Editor. Feb. 14, 2023. Published online by Supply Chain Dive.

5. “4 Tactics to Help Manufacturer With Supply Chain Issues in 2024.” USC Consulting Group Blog. January 23, 2024. Published online by USC Consulting Group.

6. “How to Use Reliability to Offset Supply Chain Issues.” Noah Bethel, CMRP, VP Product Development with PdMA Corporation. May 1, 2023. Published online by IRINFO.org.

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Supply Chain Issues 2024: How Good Reliability and Maintenance Helps