Supply Chain Snarls Today. Competitive Advantage Tomorrow.

You can’t solve a problem that you don’t understand. Recognizing that supply chain issues were coming and would linger for a long time, Compass Datacenters went to work with our suppliers, requesting full transparency and the opportunity to collaborate and work toward solutions. This is a strategy that most firms can follow to help alleviate economic pressures that are challenging the supply chain. And by following these two steps, you can ease these issues to get ahead of major impacts downstream.

Step 1, admit you have a problem

Last year, it became evident we could either be victims of circumstance and throw our hands in the air, assigning blame for project delays to a vendor upstream. Or we could spring into action, roll up our sleeves, and devise a better way. We did the latter.

Because you can’t control that which you can’t understand, we asked our suppliers for a seat at the table to discuss supply chain interruptions. There was some reticence to engage at first. But once we made it clear that we weren’t coming to the table to air our grievances and beat them up, but rather collaborate on solutions, vendors were open to giving us a peak behind the curtain. From then on, we started having very focused and regular updates with our primary supply chain vendors.

Many people are changing vendors hoping to find one that’s magically immune to the disruptions. That was never something we were going to do. Loyalty has rewards and made suppliers more apt to work with us on solutions. We’re big on continuous improvement, and if ever there was a time to challenge ourselves to bring about improvement, this was it.

We went deep with our existing bench of suppliers, meeting at least weekly with our supply chain partners and their component suppliers. Historically, we didn’t need to know the status of parts. We left that to our partners to manage and assumed everything would come together. But now we have all the details we need to be part of the solution and stay ahead of issues.

In short, we’ve come to learn at a granular level, what suppliers are facing and how that will impact projects. Putting a system in place for gathering and synthesizing this information was an undertaking in 2021. By year-end, we relayed that information to our customers and engaged them to help us with workarounds…an all-hands effort to keep projects on track.

Step 2, bringing all parties to the table

Today, in addition to weekly meetings with suppliers, we have regular meetings with customers, focused specifically on supply chain disruptions and any project resequencing that may need to occur as a result. We’ve created a “Supply Chain Notice” communication system to provide immediate notice with full transparency into supply chain developments. In it, we make recommendations for mitigation, like substituting a different part or another material.

Transparency and collaboration extend to our architectural and design partners as well. We work in close collaboration to stay ahead of supply chain issues. Under the current conditions, we are working in concert with one another to resequence projects based on material availability. Design packages are released for fabrication and ordered well ahead of historical schedules. Items that we once ordered 8 to 12 weeks in advance now need to be in the queue 8 to 12 months in advance, so we’re constantly reworking projects to meet delivery dates.

Finally, in the spirit of transparency and working together on solutions, we now have customers—particularly hyperscalers with multiple projects and significant buying power—looking at the issue with us to collaborate on workarounds. Customers can reprioritize projects and request pieces of equipment be diverted from one to another. It’s a bold move. And it’s working. While we aren’t immune to delays, we haven’t missed delivery dates and continue to meet established milestones.

Key Takeaways

1: Honesty is the best policy. Just like your mom always advised, it’s best to be upfront and transparent about the challenges brewing downstream to avoid project delays.

2: Be creative. It was surprising to discover customers’ willingness to make concessions on one project, or alter the scope, to support another. Sometimes there’s a business case for robbing Peter to pay Paul.

3: Transparency matters. Knowing your clients’ bigger-picture priorities and the internal dynamics they’re responding to is impossible. When matters like supply chain struggles, which are wholly out of your control, surface, you’ve got to bring them to light to serve customers best.

Lemons to lemonade

None of us wanted to be in the supply chain bind we find ourselves in, but I’m proud of how the Compass team handled our situation. We didn’t sit on our hands and become victims. Instead, we turned this temporary challenge into a long-term advantage. The resequencing of work we’ve done to compensate for delays has helped us discover new and better ways of doing things. What feels like a hassle today will make us better tomorrow.

Nancy Novak

Chief Innovation Officer, Compass Datacenters