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Understanding the 3 S’s and How They Impact You!

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It’s been an infection point. Like a prism, the pandemic has had the power to focus, bend and refract priorities and values.

The shift from BC (Before Covid) to AD (the era of Accelerated Digitalization) has been nothing short of seismic, rippling change around the world and across every single industry sector. With these kinds of sea changes underway comes opportunity – and at the heart of those opportunities is what I call the Three S’s — semiconductors, supply chain and sustainability. They play a critical role in our success – not just today but in the future.

Let me explain why.

S#1 – Semiconductors rule the world

The entire world is digital. Every industry has been impacted by digital transformation – and the world’s demand for compute isn’t showing any signs of slowing. McKinsey has found:

At the heart of this new reality are semiconductors — they are the underlying technology that powers the digitization of everything. The global semiconductor chip industry is expected to reach about US$600 billion this year (Deloitte) with an  annual growth that could average from 6 to 8% a year until 2030, resulting in a $1 trillion industry (McKinsey).

What’s behind the demand?

Our world is increasingly connected, and all those products require chips. One small example of the impact of the proliferation of smart devices can be seen in the automotive industry where forecasts are saying the semiconductor content of a car will roughly double between 2013 and 2030.

We have a slightly different way of explaining the demand – it’s what our CEO, Pat Gelsinger, calls the four superpowers, which are not only driving demand but also the need to accelerate Moore’s Law and pack even more processing into smaller microchips.

Superpowers Slide.jpg


Bottom line: There is an insatiable demand for compute, and NO, we do not see it slowing down. THIS IS NOT A BLIP.

S#2 – Supply chain impacts continue

A little more than year ago, I wrote about supply chains and how the pandemic changed the way businesses looked at supply chain. I explored the cracks we were starting to see and just how important an integrated, resilient supply chain would become. I also suspected we were only seeing the tip of the iceberg.

Fast forward 13 months. Supply chains continue to face difficulties, not only due to the incredible demand for chips but pressure from new factors:

  • Manufacturing: The vast majority of the world’s integrated circuits are manufactured in very limited regional locations.
  • Conflicts: When wars break out (like the devastation we’re seeing in the Ukraine), the ripple effect is felt across all industries in neighboring regions.
  • Inflation: Increasing input costs, coupled with shortages, is continuing to cause price increases and adding further inflationary pressure. Many industries are struggling to provide their customers with quotes and pricing in this volatile market.

Building Resilience

Just as Rome wasn’t built in a day, neither is a semiconductor. It takes billions of dollars and many years to build a fab, but we can’t ignore the importance of rebalancing manufacturing and foundry services to more regions.

Intel’s goal – our dream – our moonshot – is to help drive the industry to a much more balanced model. We announced IDM 2.0 in March 2021 and have been making major investments in Ohio, Oregon, and Europe ever since. We’ve also made acquisitions to become a major provider of U.S.- and Europe-based foundry capacity to serve customers globally through Intel Foundry Services.

When I show partners a map of Intel’s manufacturing network, it always surprises them. We already have a geographically diverse manufacturing model, but we continue to invest and expand so we can create a more balanced supply and a secure supply within North America & Europe.

S#3 – Sustainability

The urgent need for action on issues like climate change, the deep digital divide, lack of inclusion, and global pandemics calls for a new era of shared responsibility.” That’s an excerpt from Intel’s 2030 RISE Strategy and Goals.

We’ve already reached some impressive milestones including:

  • Achieving net positive water in three countries
  • Sustained 80% renewable energy globally
  • Sending only 5% of our total waste to landfill
  • Expanding efforts to source minerals responsibly
  • $1.4 billion in annual spending with diverse-owned suppliers
  • Being named to the 2022 World’s Most Ethical Companies® List

But it’s not enough. Intel has pledged to achieve net-zero greenhouse gas emissions by 2040, increase our overall energy efficiency and lower our carbon footprint.

We’re not in this alone. We need to work together to create solutions that lower the greenhouse gas footprint of the entire technology ecosystem so we can, together, deliver technology for good while doing good for the environment.

Opportunity in all areas … Solutions Rule the World

The 3 S's represent opportunities, and those opportunities fall under another important S – Solutions.

Businesses don’t want products. They want complete solutions, and we need a wider range of hardware, software and service partners to deliver a complete solution that delivers on the promises of AI, Edge, Cloud and a remote workplace that is productive and secure.

But, when you’re creating or delivering solutions to customers, I would challenge you to add these important questions to your process:

  • Do you know who’s making the semi-conductors powering your hardware?
  • Do you know the details of their supply chain? Is it reliable, diverse and regionally balanced?
  • And finally (and perhaps most importantly) is it all sustainable? Are you working with a company committed to being responsible and protecting the planet?

Delivering DaaS or cloud services, supporting customers with supply chain solutions or helping deliver more sustainable computing with lifecycle solutions that help companies manage their fleets and deal with technology’s end of life – these are opportunities for a wide range of partners. Aligning your solutions and services to the Three S’s put you on the path to long-term success and the opportunity to make a real difference in our world!

About the Author
David Allen, Director of Platform & Distribution Sales for Intel US region, led North American Distribution for Intel since 1998, and gained responsibility for Latin American Distribution in 2016. Employed with Intel since April, 1993, David celebrated his 25-year anniversary with the company in 2018. In 2011 he received a Lifetime Achievement Award from Intel Americas recognizing his commitment and results over the preceding 18 years. Prior to joining Intel, he held sales and management positions with Aldus, Apple and Microsoft in the Toronto area. David is actively involved in the IT industry, currently sitting on the executive advisory board of First Robotics Canada, and he is a past member of the Board of Directors for the Canadian Channel Chiefs Council. From 2017-2019, he was recognized by CRN as one of the Top Channel Chiefs in North America. David is a graduate of Ryerson University in Toronto, holding a Bachelor of Business Management degree, with a double major in Management and Marketing. He is also a graduate of Fanshawe College with a Diploma in Broadcast Journalism. David continues to reside in Newmarket, Ontario, Canada with Christine, his wife of 35 years.