If there wasn’t enough pressure put on the supply chain, Business Week highlighted another issue.  In a article entitled “Beware the Bottlenecks“  Peter Coy highlights the potential for bump in prices and increased inflation because of bottlenecks and issues within the supply chain.   It’s an interesting article that outlines a scenario for increased inflation because of increased prices that occur when capacity cannot meet the demands.  Coy pointed out that both Ford and GM had shortages of selected vehicles (Escape and Cobalt) that were related to parts and steel needed to make the cars. 

Additionally an article in the same issue “What’s Holding Back Tech” by Steve Hamm reported that Nokia indicated that some of the $832 million  third-quarter loss was due to shortages of handset components (you can’t sell what you don’t have).  The article pointed out that there are spot shortages in a wide range of components because of lowered production during the recession.

This points to another issue that many companies will be facing during the economic recovery.   How do you forecast for the recovery, especially if your organization has no prior history with upticks from a slowdown.  How do you know when to switch from survival mode to growth mode, and better still, how do you make sure your suppliers are moving at the same rate of speed as you are?

Good communication and a watchful eye on your industry or other industries which are leading indicators for you are a good source.  Look to see who’s ramping up production for component parts.  Quiz your customers to see what the word on the street is,  Is there an actual increase in sales?  Or are people laying in stock for an expected strong holiday season?  Are your supplier’s supplier’s increasing production? 

Now is the time to gather information to make informed decisions, and the more information, the better.