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Plant Insights

Global Shortages Require Local Performance Improvements

December 20, 2021

A world in which people lived in isolation at home during the pandemic is now opening up, and there's a strong demand for the consumption of goods.

Global Shortages Require Local Performance Improvements

In the last 18 months, output had been reduced and manufacturing was in survival mode and focused on supplying essential goods. Increasing the local performance of plants is important because it can contribute to solving demand problems and easing inflation risks. Inventories in the chemical industry are rising, but they're far from what they used to be prior to Covid-19.

These survival mode problems don’t occur due to a single issue but rather materialize like a whack-a-mole game — a problem pops up, gets sorted and then something else occurs. The lack of raw materials and supplies is not only impacting the chemical industry but those that rely on chemicals, such as automotive, electronics, healthcare and even food. Material shortages in this supply chain can be incredibly detrimental, not only causing delivery delays for essential goods and medicines but also inflating prices and heightening the need to speed production.

Opportunities For Manufacturing Companies

Building new plants to curtail shortages isn't the solution because it can take years to construct them. In most instances, the better choice is to have machines, equipment and the workforce operate at maximum capacity. In such instances, small and medium-sized improvement projects provide an opportunity to respond more quickly to increased demand. Changing parameters such as raw material costs or prices of manufactured products can ignite new opportunities such as innovative production methods, alternative materials, new initiatives and lucrative supply chain partnerships.

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