House construction

Manage supply chain issues with in-house construction

An illustration of the planned Sabey Data Centers campus in Round Rock, near Austin, Texas. (Image: Sabey Data Centers)

In this edition of Voices of the Industry, Dale Spencer, Construction Manager for Sabey Data Centers, explains why in-house construction companies can help data center operators manage supply chain issues.

Dale Spencer, Construction Manager, Sabey Data Centers

Over the past two years, as businesses around the world have embraced technology to support a growing distributed workforce, the demand for connectivity has exploded. We have seen increased adoption of virtual resources such as telehealth, e-learning, e-banking, etc. Data center operators have reacted urgently to meet demand but, as in the rest of the world, they are facing pressure from an increasingly disrupted supply chain.

In recent years, raw material and container shortages, plant shutdowns, and shipping bottlenecks have worsened the imbalance between data center supply and demand. Data center operators have watched helplessly as delivery times for the necessary hardware have gone from 12 months to 18 or even 24 months. Some end users have responded by issuing purchase contracts in an attempt to warehouse material for future projects. Unfortunately, this reaction complicates delivery times for this critical equipment.

Entangled supply chains in corollary industries, such as construction, compound the plight of data center operators. The costs of roofing and waterproofing materials, for example, have doubled in recent years due to their reliance on petroleum products. In an industry where manufacturers are reporting that the price of something as simple as a screw has risen due to shortages and inflation, everything downstream is naturally getting more expensive.

However, data center operators with in-house construction companies can be more nimble in these challenging times. An in-house construction team allows the company to react more quickly to changes in the market, eliminating the time wasted in sourcing and outsourcing these services. Solely dedicated to building data centers, an in-house team is naturally proactive in sourcing critical infrastructure components, mitigating potential supply chain constraints early on. Data center operators who possess this innate ability to manage supply chain constraints can stay ahead of the tough market.

Current critical infrastructure supply chain disruptions add complexity and risk to data center projects. Volume, quality and cost are growing concerns that impact a supplier’s ability to meet growing customer demand in a fiercely competitive environment. In addition to long lead times, vendors are feeling increased competition for limited space, power, labor, and construction resources. In this difficult season, the key to an agile and responsive supply chain management strategy seems to be the use of a data center-centric construction team.

Dale Spencer is a construction industry veteran, having started his career nearly 45 years ago with Sabey Corporation. Currently responsible for all Sabey Data Center construction projects, he has overseen the development of over 3.5 million square feet of critical colocation space spanning the United States.