The recent shortage of semiconductor chips and container disruptions have caused major supply chain price pressure, leading to rising costs for businesses in various sectors. CEO Elon Musk of Tesla has highlighted the "insane difficulties" in the supply chain and the "industry-wide" price increases. The situation is unlikely to resolve quickly due to the challenges of bringing new chip production online and the ongoing container shortages. Ocean freight prices have quadrupled in many lanes and are expected to remain elevated through 2021. This highlights the importance of CPOs pivoting their focus to mitigating direct costs, particularly in the area of procurement. CFOs should pay attention to these issues as they can have a significant impact on the bottom line.
