Sue Williams, Managing Director at specialist business improvement firm, Hexagon Consultants, explores strategies for data centre operators to strengthen supply chain resilience against risks like component shortages and geopolitical disruptions. She delves into how data centres can optimise spare parts and hardware inventory to maintain uptime and performance, and shares insights on applying cost-saving measures from large-scale infrastructure projects to data centre builds and upgrades.
How can data centre operators enhance the resilience of their supply chains to mitigate risks such as component shortages or geopolitical disruptions?
Many organisations have not completed comprehensive supply chain mapping and risk assessment exercises, meaning they haven’t developed alternative options to mitigate risks and problems. Tech solutions host vast capabilities in the mitigation of business risks, from improved supply and demand forecasting to preventing component shortages to improving supply chain agility and minimising the impact of geopolitical disruptions. Key benefits include:
- Critical component stockpiling- In the current market, it’s crucial for organisations to maintain strategic reserves of long-lead-time or hard-to-source components to ensure availability during supply chain disruptions.
- Risk mapping and monitoring – Supply chain mapping and advanced analytics can effectively identify vulnerabilities and proactively address risks, for example, tracking geopolitical developments or supplier stability.
- Supplier collaboration – Ensure strong communication with suppliers to share demand forecasts, enabling better alignment and anticipation of potential shortages.
Based on your experience reducing inventory in distribution businesses, what strategies can data centres adopt to optimise their spare parts and hardware inventory without compromising uptime or performance?
Identifying constraints, bottlenecks and risks is imperative for business success, as is evaluating your supplier base, production and inventory management. The effective implementation of data presents flexibility improvement opportunities within supply chains, minimising inventory risk and optimising capabilities.
Tech solutions and strategies to reduce and optimise inventories include;
- Part segmentation – Understand the demand behaviour of the organisation’s spare parts and market demand to align the inventory and supply chain strategy.
- Preventative and predictive maintenance – Utilise IoT sensors, AI and Machine Learning capabilities to determine appropriate preventative and predictive maintenance regimes to minimise the risk of potential downtime.
- Lifecycle management – Understand the changing behaviour of equipment over time to align demand forecasting, maintenance scheduling and parts and hardware inventory planning.
- Leverage the supply chain – Investigate options such as vendor-managed inventory (VMI) to improve availability without inventory holding costs.
Data centre construction and expansion projects are capital-intensive. What cost-saving measures have you seen successfully implemented in large-scale infrastructure projects, and how can they apply to data centre builds or upgrades?
Tech solutions can be used to optimise processes such as material flow planning, streamline systems, improve inventory management and better align with consumer demand, leading to overall cost savings for businesses. Tech solutions which can be implemented in large-scale projects to drive cost saving opportunities include:
- Modular construction – Leverage prefabricated, modular designs that reduce build times and labour costs while allowing for scalable growth.
- Value engineering – Conduct rigorous reviews of project specifications to identify cost-saving opportunities without compromising quality or functionality.
- Energy-efficient design – Invest in energy-efficient cooling systems and power distribution units (PDUs) to lower operational costs over the data centre’s lifecycle.
- Local sourcing – Source materials and labour locally to reduce transportation costs and benefit from regional expertise (subject to understanding cost trade-offs).
- Phased expansion – Build in phases aligned with demand growth to spread out capital expenditure and mitigate over-expansion.
What lessons from sectors like aerospace and automotive can data centre operators leverage to streamline their operations and improve overall efficiency?
Businesses are becoming more empowered to adopt the transfer of knowledge across industries. This innovative process presents increased capabilities, allowing organisations to adopt proven solutions that can lead to a vast improvement in efficiencies along with the mitigation of potential challenges.
By embracing models from other industries such as aerospace and automotive that have demonstrable results, organisations can increase their bandwidth for new opportunities, as well as drive continued growth in today’s competitive business landscapes.
By looking outside of its own industry, an organisation is able to implement tested tech to achieve results more effectively to drive tangible benefits with solutions such as:
- Predictive maintenance – Utilise IoT sensors and AI to monitor equipment health, reducing unplanned downtime and extending asset life.
- Standardisation – Standardise components and processes where possible, reducing complexity and costs in future procurement and maintenance.
- Supply chain mapping and risk assessment – Understand each stage of the supply chain and where issues may occur. A better and more in-depth understanding of supply chains allows businesses to better predict and plan mitigation strategies.
As data centres face increasing pressure to reduce their environmental impact, what best practices can be applied to create a more sustainable supply chain, from procurement to disposal of outdated equipment?
There is an increasing number of companies globally who are looking for ways to improve the Environment, Social, Governance (ESG) impact of their business. There are various strategies that can be implemented to improve the environmental impact of an organisation, for example, creating a circular economy by improving lifecycle management to reduce pollution and improve product life.
AI and machine-led learnings are key ways in which businesses can focus on improving the sustainability of supply chains. Technology solutions can also be used to improve product and process design, for example, the implementation of digital twin solutions to allow organisations to design for sustainability, construction and operation through to the end of its life, specifically considering energy optimisation and use of renewable sources.
Given the critical nature of data centres, how can operators develop robust risk mitigation strategies across their supply chain to ensure uninterrupted service and avoid costly downtime?
As we become more reliant on tech solutions and data centres, the ability to mitigate risk and implement robust strategies to ensure uninterrupted services becomes increasingly important.
As organisations develop and become increasingly dependent on tech solutions for smooth running, financial success and sustained growth it’s imperative that businesses develop robust risk mitigation strategies. Steps to develop risk mitigation plans include:
- Scenario planning – Develop and implement contingency plans for potential disruptions, such as natural disasters, cyberattacks or trade restrictions.
- Regular stress testing – Simulate crisis scenarios to evaluate and improve response mechanisms across the supply chain.
- Supply chain digitisation – Invest in digital tools for real-time tracking, risk assessment and contingency activation.
With the rapid evolution of data centre technology, how can operators ensure their supply chains are agile enough to adapt to emerging trends like AI, Edge Computing and modular data centres?
As data centre technology evolves at an accelerating pace, driven by trends such as AI and modular data centres, operators must ensure their supply chains are flexible, resilient and capable of quickly adapting to new demands. In an environment where new technological breakthroughs are frequent, maintaining an agile supply chain is crucial to avoiding disruptions, staying competitive, and ensuring that infrastructure can meet the demands of next-generation workloads.
One of the most effective ways to achieve supply chain agility is to invest in modular data centre designs – software-defined systems that can evolve alongside technological trends. Modular systems enable data centre operators to build capacity in smaller increments, adding or removing units as demand fluctuates.
Leveraging AI and machine learning also boosts agility. By analysing trends and forecasting shifts, operators can make proactive adjustments to their supply chain strategies. Advanced analytics help identify potential bottlenecks, hardware failures, or supply shortages before they impact operations, allowing for a more responsive and reactive approach.
Flexible contracts also play a critical role in building supply chain agility. By negotiating adaptable agreements with suppliers, companies can better accommodate evolving needs, particularly for emerging technologies like AI and edge computing.
Finally, partnering with technology providers and integrators is essential for staying ahead of technological advancements. Collaborating with experts enables rapid adoption of innovative solutions, ensuring supply chains remain agile in a rapidly changing landscape.
