B2B Tech Talk with Ingram Micro
B2B Tech Talk with Ingram Micro

Episode · 6 days ago

How Honeywell and Ingram Micro are reducing the impact of supply chain challenges


Supply chain challenges are expected to persist for the foreseeable future. In the meantime, how are Honeywell and Ingram Micro working together to minimize the impact and create selling opportunities for partners?.

Shelby Skrhak speaks with Jeff Yelton, vice president of technology solutions and specialty technologies at Ingram Micro, and Andrew D’Amelio, vice president and general manager, U.S. and Canada, at Honeywell, about:

- How the supply chain is causing headaches for partners

- How Ingram Micro and Honeywell are reducing impacts

- Advice for dealing with shipping delays

- Opportunities that exist within the channel

For more information, contact the Ingram Micro Honeywell team (honeywelloperations@ingrammicro.com) or visit Honeywell’s distribution center information page.

To join the discussion, follow us on Twitter @IngramTechSol #B2BTechTalk

Listen to this episode and more like it by subscribing to B2B Tech Talk on Spotify, Apple Podcasts, or Stitcher. Or tune in on our website.

...you're listening to B two B tech talkwith ingram Micro the place to learn about new technology and technologicaladvances before they become mainstream, this podcast is sponsored by ingramMicro's imagine next. It's not about the destination, it's about goingsomeplace you never thought possible. Go to imagine next dot ingram micro dotcom to find out more. Let's get into it. Welcome to B two B tech Talk withingram Micro. I'm your host. Shelby skirt talk my guest today are JeffYelton, vice president. Technology solutions and specialty technologiesfor ingram Micro and Andrew, D'Amelio Vice President and general Manager U. S.And Canada productivity solutions and services for Honeywell. Jeff and Andrew.Welcome. Thank you Shelby. We're looking forward to this. Yeah. Goodmorning Shelby. Thanks for having us. Well, fantastic. So today we're gettingreal about the global supply chain and discussing ways that Honeywell Link orMicro are really creating selling opportunities for the channel despitethese challenges. So Jeff, will you set the scene for us? I mean whatspecifically in the supply chain is causing the most headaches for partnersright now? Yeah, that's a great question Shelby. Um I'll tell you, it'sit's a complex uh answer. You know when it first started we thought it wasmainly the shipping containers that were out of sync and with where theyneeded to be. But when we dove into this, the supply chain issues are much,much more complicated. It starts all the way at the highest level wherewe're having component shortages And I'm sure Andy can talk more about thispiece of it, but where the manufacturers are having componentshortages uh to be able to manufacture the devices themselves. But once theydo get manufactured and most of the manufacturing is in the Asian basinarea. Trying to get those products to the U. S. Is very very difficultbecause of the shift from buying in store to the shift. And this is at theconsumer level to the shift of buying online. The amount of products that arebeing shipped from Asia to the US has increased substantially. And the amountof capacity from a ship point of view and a container point of view has beenvery low. Then when you get to the United States in ports like the portsthere near Los Angeles and Long Beach. The number of workers there to offloadthose containers. The amount of truck, number of truck drivers that have theability to move the containers off of the ports out into the interstatehighway system or to the trains and then the number of trains to transportthose containers out to the warehouses around the country. There areconstraints in all of those areas. And so it's an extremely complex problem.I'll tell you this past week, I was in Long Beach until you are there and yousee the size and complexity of the issue. The number of containers,literally there are hundreds of thousands of containers that are therethat need to be shipped. Its until you see that you understand how, how big ofa problem this really is from the information that we're gathering, Thisis something that's not going to be worked out in the next few months. It'sprobably gonna take all of 2022 and probably a portion of 2023 before thesupply chain starts to return to normal. That's mind boggling. And that'sinteresting. I hadn't heard that before, you know, from people that are there onthe ground. I mean, you hear yes, that there's all of these containers sitting.But you're right. I mean, having been to long beach, I can picture exact thatarea. And so now layer hundreds of...

...thousands of containers on that mentalimage of the that we have in our minds and that really kind of puts it inperspective. It does. And while I talked about Long Beach, a lot of thesesame issues are are the other ports. They're small reports than Long Beach,but all the ports on the west Coast are having some of these same issues. AndI'm actually located on the east coast in Greenville south Carolina andcharleston is a big part of ours. And charleston has a lot of these sameissues too. So it's it's it's all of the ports, all of the shipping entrypoints into the U. S. Right now. Yeah, well, you know, they're, you know,obviously material availability is uh is key there. I mean a 50 cent partcould be holding up a million dollar product. So Jeff, how does ingramMicro's inventory management system really help alleviate this? Well I would say I'm not sure wealleviated but it's some of the things that we're doing to try to reduce theimpact is one of the things that we're doing is trying to consolidateshipments um in Asia uh to make sure that we are filling up full containersso that that we get control of those containers earlier in the supply chainwhen those containers land here in the US and they get out of the ports. Oneof the things that we're doing is we are we have actually have some of ourown trucks now that we're taking those containers between our warehouses, wehave about seven warehouses here in the US and those products have to be putinto all of the different warehouses. And so where in the past we've countedon ups or Fedex or the L. T. L. Carriers, the less than load carrierswere starting to use some of our own trucks to move those products aroundwhich has helped but it definitely has not alleviated the problem because theproblem is so severe. Just trying to find trucks to rent is very verydifficult. Yeah. Well so I mean I'm glad you you hit on that because Iunderstand uh Andrew that Honeywell is is working on a lot of these issues. Imean um this supply chain movement of of goods and the lack of availableworkforce. Can you tell us about this move that Honeywell is making withpremium carriers to kind of help move things along for customers? Sure.Actually I'll expand a bit on what, what Jeff talked about it. I think Jeffdid a great job covering, you know, the logistics side. Let me just talk alittle bit about the components side and you know, maybe a little moreoptimistic. You know, I'm thinking Q three, Q four of next year. We shouldkind of be out of the soup here, Jeff, I think you mentioned maybe all the wayto the beginning of 2023 you know, I hope that's, that's not thecase. You may be right, but maybe you and I can place a nickel bet on that.I'm hoping I'm right on on this one. But, but we'll see. Look. It all startswith the component shortages and one of the key ones is the microchip. Somicroprocessors, you just can't get, there's such high demand and there'snot enough capacity. And this isn't something where you can just Turn on afactory or turn on a plant and within 30 days you have increased capacity,you know, to bring up a microprocessor. Fab facility. You know, could take morethan a year. And so that's one of the primary reasons why it's taken so longfor us to recover here. So you have the microchip shortage, you have all thesensor shortages. You know, you hear about the cars that are sitting at thefactories or in the lots and uh, you can't ship them. I heard that GM wasdoing something where they're now no longer offering heated seats becausethat takes up the highest amount of sensors in the vehicles just to try andbe able to deliver something to their...

...customer base. So you have a sensorshortage, you have a chips shortage for our type of offering. One of them isthe rugged mobile computer. You have a display shortage, There's issues tryingto get resins that go into the plastics, there's metal shortages. So imagineyou're trying to balance all this as well as the logistics shortages thatwere logistics problems that Jeff talked about. So we're doing a lot onthe component side replacing the longtime buys with our vendors to tryand overcome this. We're pulling in the full power of Honeywell. Imagine, youknow, you could have presidents of countries calling to try and get partsfor the factories, which means so much for their economy. And now at the sametime we have our chairman of the board calling, trying to get the parts thatwe need for our mutual customers. So we try and leverage that full horsepowerHoneywell. What I would say is, you know, don't delegate this if you reallyneed to get parts, we need to get something done. You know, it should behandled, you know, at our level and not kind of delegated down within theworkforce. We also have more than 30 reengineering efforts right now wherewe're trying to get second source components into the offerings. So maybewe can't get the first source, so we're out there actively trying to getsomething else. Spect in that we can still manufacture, working with ingram,working with our channel partners on skew substitution, you know, that'sanother big part right now. It's hard to get exactly what you want. But thereare various products that you still can get. So working with the teams on thatand then of course on the premium freight. I mean we have big contractswith all the large providers, which we all know. Honeywell does a lot, a lotof logistics and shipments and right now rather than make our customers wait,we are paying those premiums and uh, You know, they're going up probably 50%.And even though you pay the premium, I think Jeff talked about the, thecontainer part, even on the air shipments right now in the past, peoplewould think you could get something air from Asia within 7 to 10 days. It's 30days and longer now. So I think these issues are just prevalent all the wayup and down the whole supply chain. Let me let me add on one thing that um Andyhit on because it's really, really key and I want to make sure that everybodyout there understands the level of commitment that Honeywell has made whenhe talked about, you know, making commitments to these componentsuppliers there sometimes making commitments out a year or more on thosecomponents and the inventory risk of doing that is extremely high. So Ithink for a Honeywell to step up and make those type of commitments is astatement of of how committed they are to the channel and their products andmaking sure that that they're able to supply their products to themarketplace. Well, because yeah, I mean, it'sinteresting that it's affecting every level. I mean, yes, like the consumersare feeling it, but you know, Honey would themselves are in encounteringthese, these challenges trying to serve the channel. So uh it's interesting.Andrew to hear you say about the markup that's happening and just, you know,basically taking the bull by the horns and trying to get goods moving. AndI'll be interested to see which which of these projections end of Q four orearly Q three will will be the will be the, the answer. Right. I will tell youthat is one that is one bet that I hope to lose. I know I know I'm going tomake you pay that nickel to. Absolutely, absolutely. Mhm. Well, so um one thingthat also occurs to me is is the delays...

...that that's that this brings um we're also facing, you know, upcomingholidays, I guess. Andrew and Jeff, I'll put it to either one of you, whatkind of again, this real talk, what kind of delays, realistic delays are weseeing on each level, you know, from the consumer level to two partners tothe, you know, for the, the channel at large, basically what I guess is youradvice and maybe I'll put it to both of you, which is your advice for forunderstanding the time constraints and what a delay you can expect is AndyI'll let you start on that, then I'll follow up. Okay, good. I mean, look, wewe work with our partners, our customers, our sales team, we work withingram, I don't know, multiple, multiple times an hour, it seems. Andfor me it's all around communication. In the past, We could look at something60 days out and say that's plenty of time for us to respond to that. Maybewe looked a quarter out and we would say that's plenty of time. What I'mtelling my teams now is if we don't have our demand, our view of what thepartners and the end users are going to want 9 to 12 months from now. We'realready behind the eight ball. It was an interesting point that Jeff made,our new product development time is, let's call it 6 to 9 months. So by thetime we create our business case, get the team engaged, you know, 6 to 9months from them, we have a new offering out to the industry. Well, ifwe have to place bets on, on chips, 12 to 15 months in advance, imagine you'remaking a commitment to buy a technology where you haven't finished fullydeveloping the product. So now put on top of that, what's the real customerdemand going to be, what type of configuration is it going to be? Solook, my advice is we have to shift our way of thinking and it's all aroundcommunication and over communication work. We're in an allocation modelright now. Only once in my career have we done something like this and it was,you know, 20 years ago. So there are many people that are in our industrythat have never gone through a situation like this. So it's newlearning for a lot of us, we didn't even have a global allocation processthat we could go refer to and you know, Honey, Well, there's a lot of processesthat that we use on a daily basis, so it's a lot of new learning. And myadvice is to try and get as intimate as you can with the end user with thepartner, freely share the communication and then that's how you can be better.I think the days of hey, I think I'm going to need 1000 ingram put them onthe shelf for me and I would love to do that and and has done that for decades,but it's not that simple anymore. If it were, you know, we wouldn't have this,this problem. So just just keep the lines of communication open. You don'tunderstand that when your sales partner or ingram comes to you and says, hey,we need a decision on this within the next week. It's not a sales ploy, it'sreal. And if somebody is not willing to find out the information to make thecommitment, you know, those goods or services will probably be allocated tosomebody else. So I do think it's a bit of a different world we work in today.You know, we're lucky to have a great partner like ingram where, you know, wecan communicate and over communicate and kind of take risks and betstogether, but that customer intimacy is more important now than ever. Yeah, I would agree with that. Andy100%. The majority of the inventory we're getting, it, we're, it's calledCross docking. We literally bring it in one door and turn around and ship itout within 24-48 hours. And so if we don't have those orders in the systemnow, the odds of, of a customer being...

...able to get it are very, very low. Oneother thing, I would tell you, we have about four times about 400% of ourregular backlog. It's about at 400% of that right now. So we have that manyorders out there with manufacturers across, not only with Honeywell butacross the 1500 vendors that we have and we are backed up at 400% right now,wow, wow. Well, um, you know, of course, I guess the silver lining is that withchallenges. Do come opportunities, So Andrew what opportunities exist in thechannel. And can you give us some examples? Sure, Great, great question.Yeah. Look, it's, it's unfortunate but crisis does bring opportunity and it'snot as though every configuration of every type of offering is unavailable.You know, there is still product there. It may not be the first choice of aparticular product. And so, working together with the ingram team with theapplication engineers, the partner having the end user all work together,chances are that maybe there is a version that exists that you could getthat will work in the application now, maybe you may need to change a fewthings with the workflow. So that, that that's the first thing, you know,really digging in and understanding the use case. I think that there may besome some substitution that can be made to at least get somebody to start up afacility or kind of get them, get them over the hump. That's the first thing.The second thing is software, you know, software doesn't really have, have alead time, right. If you find an application that works for you, you canpretty much get it tomorrow. So that's the other thing that I would sayHoneywell is developing more and more software applications for our type ofofferings. I know that ingram has a whole business dedicated to that. So,so that's the other piece. Maybe there's a software application that apartner can sell to an end user, so that maybe they don't need as manydevices where they can get away with fewer devices because this applicationwill allow them to be to be more efficient. I think software arounddevice management and device up time, you know, anything that will go anddrive productivity today, especially when you have not only a constraint uhsupply chain, you have a constrained workforce. So you're kind of trying tosolve two problems at the same time. So really understanding how the end userworks and what the workflows are providing suggestions on how tooptimize those workflows and then really gearing that around what'savailable today In the supply chain, you know, Jeff talked about how long ittakes for goods to get into the poor and to get to, you know, get to theingram warehouses and then how fast they have to turn them around for me,that's that's part of it. Maybe in the past it would take 48 hours now we wantto get that stuff turned around within a couple hours and that requires newtechnology and different type of technology within those facilities,which I know that ingram has been invested in technology and and we'vebeen helping with some of that in their in their facilities as well. So youknow, the good thing about technology is it allows you to go faster and uhand typically allows you to maybe not need as many people and so as long aswe work together and try to create solutions what's currently available, Ido think that that provides a lot of opportunity in the channel and again,there's always a reason to talk to the end user and so what better reason thanto talk about what's different today, you know, versus a year ago and how wecan work together to make them be more efficient. So it's it's unfortunatewhen you're in crisis mode, but I do...

...think there's still plenty of businessout there for all of us to grab definitely. Well uh as we start to uhto close in on our time here, um we typically close each episode by askingour guests where do you see technology going in the next year now? You guyshave already given some of your uh your predictions But where do you seetechnology going in the next year, Jeff? Well for me, I think the um I saw agreat chart from Gartner a few weeks ago and they had concentric circlesabout technology that could actually generate revenue today or in the nextsay, you know, 12 months and then they in each concentric circle that went outon a year or two. And if you look at one of those that's relatively close inthat I think is going to have one of the biggest impacts on the data captureindustry. I think it's gonna be five G. Um and putting in the five G networksbecause as Andy talked about it, you know, more and more of the warehousesas an example or the manufacturing floors are being driven by software andvideo and so as people start putting in more software and more video, um theyneed a more robust robust network to be able to run that on. And I think theadvent of public five G, the advent of private five G. And even the advent ofof the private CB rs networks are going to be something that most of ourpartners are going to have to deal with and start determining when do I usewifi six? When do I use 800 gigahertz? When do I use uh private five G. Whendo I use Public five G. And the thing that I love about that from a Honeywellpoint of view is it's going to drive the need for a whole new set ofproducts That are coming from Honeywell, they will play in this space, and thenumber of applications that will be able to be laid on top of these new 5Gnetworks are gonna be very exciting. Going to drive a lot of efficiency andproductivity and I'm just really excited about that. One specifictechnology, Jeff CB Rs Um it's an open band. So um the 5G is um you have theprivate, I mean I'm sorry, you have the the where people buy the bandwidth andthen you have the open bandwidth, kind of like a radio, like a walkie talkieradio. Uh and there there is open bandwidth that anybody can use withouthaving to buy that bandwidth. And that's what the C B R s is. Got it, gotit Andrew. How about you? Yeah, I think those are great, great points, Jeff.And yes, Honeywell will be at the forefront of those technologies. I'llgo back to my engineering education and I'll cite moore's law and moore's lawsays that technology will keep getting smaller uh and faster and more powerful.And so when you think about that, you know, what does that mean? Well, itmeans that you can instrument a worker maybe with smaller devices, maybe witha smaller wearable and now have these uh these sensors and devices connecttogether and then communicate back through the technologies that Jeffmentioned. Maybe they're cloud based. Now we're in the past, they'd all be onpremise and these can allow for just very fast uh interchange of information.You can also imagine where now you have a shortage of workers that workersfully instrumented, that worker maybe getting commands to go move, move goods,either, you know, visually or through voice and at the same time, there'sautomation, maybe there's a robot or...

...some sort of machinery that's alsogetting commands to go, do you know, certain type of workflows now, I think,you know, down the road, everybody thinks about this fully autonomous,maybe type of warehouse or factory, you know, where there there there's nohumans there. I don't think that use case, you know, works in allapplications. What I think more about is as as we continue to evolve is a usecase where you have the machine or the robot working in unison with the worker.And then just as commands are being given to the human commands are alsobeing given to the robot and they're kind of working side by side. And thoseenabling technologies that Jeff mentioned really allow for that. And ofcourse moving the cloud based applications allow for that. And thefact that everything can get smaller, you know, also allows for that. Theonly thing I'll say though is as we go into this more data rich environment,security, you know, has to be a key concern for everybody. Even as recentas yesterday and today there were new security breaches that were publiclyannounced, right? So I think that as you pick, these new technologies, justmake sure you're partnering with companies that are kind of at theforefront on the security side and, you know, I would certainly place ingramand ingram and Honeywell right up there towards the top. So look, I think it'sgoing to be an exciting time for technology over the next three years,then over the next 10 years as it has been and I'm I'm really excited to bein this space. Well gentlemen, thank you so much for joining me. Thank you.My pleasure, Jeff, get your nickel ready. I'll be you know, I'm ready topay it, I'm ready to pay it. Hey, thanks for having me. It's been a lotof fun and thank you listeners for tuning in and subscribing to B two Btech Talk with ingram Micro if you like this episode or have a question, pleasejoin the discussion on twitter with the hashtag B two B Tech talk. Until nexttime I'm Shelby scare hawk. You've been listening to B two B tech talk withingram micro. This episode was sponsored by ingram Micro's. Imaginenext B two B tech talk is a joint production with sweet fish Media andAnger Micro. To not miss an episode. Subscribe today to your favoritepodcast platform.

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