This year is without a doubt one we’ll all tell stories about. Many of which will have roots in the COVID-19 outbreak. Some stories will detail the hardships and setbacks, while others will be about the incredible resiliency from people and businesses around the globe. While staying on top of design and support trends is always important, certain trends may accelerate or decelerate as the world adjusts to the pandemic’s effects.
In 2020, the future of data storage is growth and change, then more growth and change. New technologies and national “data sovereignty” initiatives are moving some data out of the cloud to smaller data centers close to end users. As user applications and storage requirements multiply, is your company ready to meet these challenges and opportunities?
1. The data storage market is growing. Can you provide service after the sale?
Data storage spending overall was relatively flat in 2019, but analysts predict growth in 2020 as costs drop and businesses focus on the necessity of better data collection and analytics.
In 2019, IndustryArc predicted a compound annual growth rate (CAGR) of 21% for data storage between 2019 and 2025. Market growth should be exceptionally strong in the Asian-Pacific (APAC) region. Market analysts are bullish on India, in particular. It’s the region’s second-largest economy after China, and companies there are moving toward digitization and IT outsourcing.
Rapid growth brings both opportunity and risk. If a data storage failure crashes a critical application, the effects can cripple a customer’s operations and cascade down to their customers. Consider the blowback if an online retailer can’t take orders or a hospital’s electronic medical records disappear.
Customers have long memories. In 2019, 80% of B2B buyers said they had switched suppliers in the past 24 months due to service issues. Satisfied customers are repeat customers. Unhappy customers readily share their experiences with colleagues. A single service failure can easily become a cocktail party punch line — don’t let it be your company’s failure!
Take steps now to strengthen your service supply chain — particularly transportation logistics and service/repair functions — so that service is ready grow with sales.
2. Organizations are moving away from the cloud. Are you ready to support their hybrid models?
In previous years, cloud storage seemed to be the future for everyone, from OEM’s enterprise applications to friends sharing Google calendars. In 2019 though, it was clear that the cloud isn’t ideal for every application.
According to NetworkWorld:
“On average, organizations expect to move 50% of their public cloud applications to hosted private or on-premises locations over the next two years, IDC says. The top repatriation drivers, according to the research firm, are security (cited by 19% of respondents), performance (14%), cost (12%), control (12%), and to centralize or reduce shadow IT (11%).”
Regardless of what specific model your customers choose, you will need service technicians and forward stocking locations close enough to the storage facilities to ensure service level agreements are met. There could be more locations to service, but customers will still expect fast turnaround and 100% uptime.
That requires a robust service supply chain with in-region FSLs and the tools needed to respond on a dime to unexpected heavy traffic patterns, natural disasters or global pandemics to meet those SLAs.
3. International data storage markets are heating up. How strong is your trade compliance?
International operations can make every task more difficult, particularly trade compliance. A complex web of national laws and international agreements controls which products you can ship and where, paperwork requirements, and tariff and duty costs.
For example, many OEMs are tantalized by India’s rapid growth, but the culture, costs, and regulatory requirements can be quite a shock for exporters. For example:
- India has its own product coding system. Mistakes can increase costs by up to 20%.
- The country is prone to corruption, and bribery is commonplace. However, it’s strictly illegal under the United States’ Foreign Corrupt Practices Act.
- The customs duty calculation in India is complex. The seven-step process has tendencies to cause confusion.
There are no “small” mistakes in trade compliance. Shipments may be delayed or seized in customs and your company can be fined. A strong trade compliance team is an important component of your supply chain.
4. The environment is a top political and consumer issue. Are you ready to go green?
In 2019, there were more than 8 million data centers worldwide. The edge data center market is forecasted to grow at a 36.3% CAGR between 2017 and 2022. Data centers require huge amounts of energy and generate carbon emissions on par with the global airline industry.
Although data storage OEMs aren’t responsible for the efficiencies (or inefficiencies) of customer operations, they can take steps to make their own operations more environmentally friendly. For example, geospatial modeling is one way to manage a large, international install base more efficiently. It can help you:
- Determine the best locations for FSLs or repair centers to minimize transportation costs — and carbon emissions.
- Manage inventory more efficiently and reduce the need for costly air shipments.
- Create disaster plans to determine the best ways to support customers during disruptions caused by weather, natural disasters, or political upheaval.
In addition to being good for the environment, green initiatives are good PR for your brand. In 2019, 87% of B2B buyers said they consider a company’s brand values and philanthropy when choosing suppliers. Imagine explaining why your company is listed on an environmental advocacy organization’s “Dirty Dozen” list.
Are you ready for a premier service supply chain partner? Call Flash Global.
We have earned the trust of some of the world’s largest data storage OEMs, forming partnerships with companies that have annual combined revenues of more than $150 billion.
We are with you every step of the way, monitoring and strengthening every link in your service supply chain. Our services include:
- Worldwide support. Flash Global has operations is more than 130 countries.
- Spare parts logistics. Always have the right parts in the right places at the right times.
- In-region technical services. Screen and test parts in-region so you can get NTF/NFF components back into customers’ equipment quickly.
- GDPR compliance. We only stock GDPR compliant products. We can also help data storage facilities with their GDPR compliance efforts.
Contact us to learn more about how our team of supply chain experts can help you build brand loyalty and reduce total cost of ownership.