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How supply chain issues affect data storage and what IT can do

Supply chain issues challenge IT teams and data storage administrators. It's important to be as proactive as possible when managing storage in an era of such uncertainty.

Storage administrators face a bigger challenge than ever in trying to contend with a supply chain that has been racked by the COVID-19 pandemic, increased costs, global shipping problems, labor and chip shortages, and shifting customer buying patterns. To make matters worse, two Japanese manufacturing plants recently discovered that they used contaminated materials to build NAND flash, resulting in the loss of more than 6.5 exabytes of memory.

It's unclear when these issues will end. As a result, storage admins must look for new strategies to address today's supply chain woes.

The biggest supply chain challenges facing storage admins

Many of the supply chain problems for IT are the result of a semiconductor chip shortage that has affected storage systems both directly and indirectly. For example, the semiconductors for flash drive controllers are harder to come by and take longer to get. The same goes for the NAND chips themselves, as well as other memory types.

The chip shortage has also affected IT equipment that supports the storage systems. This equipment includes storage and backup servers, plus network equipment, such as Ethernet switches. There have also been shortages in resistors, capacitors and power management integrated circuits, which manage power on electronic devices, such as SSDs and high-performing servers.

The many causes of the chip shortage include problems with substrate manufacturing and an overreliance on the Taiwan Semiconductor Manufacturing Company (TSMC), which builds more than 50% of the world's chips. When Taiwan experienced one of its worst droughts in over 50 years, TSMC lacked the water it needed to maintain full production.

But the global COVID-19 pandemic brought the supply chain to its lowest point. With workers either sick or in lockdown, factories reduced production or closed altogether. Upstream stoppages and lack of materials disrupted factories that could continue to operate. This coincided with a large increase in demand for data center and home office equipment as organizations and service providers tried to accommodate a large workforce that had suddenly gone remote. Lead times for getting equipment grew longer, with some items almost impossible to find.

Supply chain issues were further exacerbated by labor shortages, extreme weather events, overbuying and stockpiling, as well as the general tendency to prioritize hyperscalers and other high-margin customers over other organizations. Some of these issues also contributed to global shipping problems that caused additional supply chain disruptions and even longer lead times.

Earlier this year, the picture for data storage grew even bleaker. Two Western Digital and Kioxia factories in Japan had to scrap more than 6.5 million terabytes of 3D NAND flash modules because one of the materials used in the manufacturing process had been contaminated. This alone could cause NAND flash prices to jump up by as much as 10%, according to a TrendForce forecast.

What does it all mean for storage admins?

As a result, cost is one of the biggest challenges -- both Opex and Capex.

The price of storage itself is on the rise, especially for SSDs, which rely on semiconductor materials. Prices are increasing at every stage of the manufacturing and delivery process. At the same time, the demand for these products has not abated, contributing even further to the higher prices.

But IT teams have more to contend with than just hardware costs. They must also spend more time on supply chain management (SCM) and the procurement process in general and get more life out of the equipment they already have. All this added effort takes time and energy on the part of the admin, which translates to additional Opex.

Product shortages and long lead times can also make it more difficult for IT teams and storage administrators to respond quickly to changing business requirements or new business opportunities, which results in lost revenues.

If IT teams decide to purchase additional storage -- or any of its supporting infrastructure -- they must then contend with the ever-increasing lead times, which could mean months of waiting. It might also mean that components come trickling in, while IT cobbles together a temporary strategy to accommodate the new equipment. For example, they might eventually get the storage arrays they ordered but then need to wait still longer for the network switches to support those arrays.

Supply chain shortages affect organizations of all sizes, although it's the smaller businesses that get hit the hardest.

5 ways for storage admins to deal with supply chain issues

Supply chain shortages affect organizations of all sizes, although it's the smaller businesses that get hit the hardest. At this point, it's unclear when these shortages will end. Until then, IT teams and storage administrators must come up with ways to maintain their storage infrastructure and still meet current and future business requirements.

1. Plan ahead

Invest in the time and effort to improve forecasting capabilities and carry out effective capacity planning. Be willing to order equipment in advance. Buy extra components, and hold them in storage. Above all, have a good understanding of the organization's supply chain and what it will take to support storage requirements.

2. Broaden the supplier base

Consider different approaches to procurement, such as purchasing pre-owned or refurbished components. Some teams have even resorted to eBay. Strive to maintain good relationships with suppliers, keeping communications open and making sure they're paid on time. Try to collaborate with hardware manufacturers to get components.

3. Look to equipment at hand

Identify what sits idle or underutilized, and then put that equipment to better use. At the same time, try to extend the lives of current systems as much as possible, relying less on vendor refresh recommendations and more on how well the equipment is working. Take the steps necessary to assess, monitor and maintain those systems on an ongoing basis. Put into place good data management practices that eliminate unnecessary or duplicate data, and archive the data that doesn't require everyday access.

4. Optimize operations

Look for ways to make operations as efficient as possible. This efficiency includes SCM, equipment refreshing and procurement. Evaluate storage management practices, and modify them as necessary to optimize maintenance and utilization. Look for technologies that are conducive to better storage utilization, such as software-defined storage, composable disaggregated infrastructure and infrastructure as code.

5. Turn to the cloud

IT teams and storage administrators might be able to address their immediate data needs quicker and with fewer headaches if they move some of that data to the cloud. This option is even more appealing for smaller organizations that compete against bigger customers, such as the hyperscalers, for those products. The cloud option, however, is not an all-or-nothing strategy. IT teams need only move some of their data to the cloud, basing their decision on the type of supported workloads and the availability of in-house storage resources.

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