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Achieving supply chain resilience

  • Blog
  • Read time: 7 minutes

 

“You need to ensure that communication is not a hindering factor.”

It comes as no surprise to people in the manufacturing industry that in order for you to make good business, you need a resilient supply chain. In other words, it has to be reliable and performant. Your end product is highly dependent on other companies’ ability to provide you with quality parts, components and services at a reasonable cost and timeframe. Setting up your supply chain and maintaining it is the main priorities of your purchaser(s) or perhaps even purchasing department if you are working at a big corporation.

Recent times have shown that streamlining your supply chain and focusing on perhaps just one or two of the parameters that make up a performant and resilient supply chain should be reconsidered. Finding the right balance among your suppliers between cost, speed, location (closeness), flexibility, quality, etc. is becoming more and more important.

  • How resilient is your supply chain?
  • How do you add another supplier to your network?
  • How do you replace a supplier that is not performing according to your standards anymore?
  • Are the legal processes in place for doing this? And how do you make it happen, technology-wise?

At Eurostep we have been helping companies, for over two decades now, in setting up their supply chain collaboration. From our experience, having the correct legal processes in place is crucial. There have to be contracts signed and NDAs agreed.  Note that nowadays, this can also be streamlined and performed online. But once you have an agreement there is still tons of work to be done before your supplier can actually deliver value to you. You have to transfer the relevant product data to them so that they can start producing what you require. You also need to make sure when receiving their feedback, that you have a clear audit trail of your communication. This will allow you to stay in control over regulatory compliance and quality measures while delivering your product.

Here are three common scenarios where we see that OEMs struggle in finding a flexible solution when using suppliers as part of their manufacturing process:

1. You have a complexity problem

  • You design/manufacture/assemble a complex product containing a multitude of components that you need to keep track of and understand in detail how they work. Your suppliers provide you with information but it is a nightmare to control this. The information is in different formats and the quality of the information varies heavily. Hence you cannot trust that the provided information is sufficient for your downstream processes like service documentation, providing information for your PIM systems, quality controls at part deliveries and more.

2. You have a number/scaling problem

  • You have so many suppliers that getting a clear view of the overall situation and where to focus your efforts is becoming a pain. Maintaining all the email threads, managing the data in all shared folders (not to mention the control over access rights) and last but not least, the chaos when designs or customer requests begin to change.

3. You have an administrative quality problem because of a demanding customer

  • You feel that you are in control of your product. You also got a feeling that your suppliers are serious players that do a good job! However, your customer keeps loading you with a tremendous amount of administrative tasks regarding certificates, detailed traceability of every single component in your product; when, where and how it was produced. Things that you possible cannot know unless your suppliers provide you with that information. More than often, this information is not provided, is missing or has been misplaced in the process. This then causes delays, since both the OEM and the supplier(s) have to divert their resources to solve these issues instead of on focusing on delivering the product on time.

These are just three types of problems that are all related to supplier communication. Companies today solve them in different ways. In many cases by using email communication, shared folders, custom-built applications or databases, or simply by letting suppliers into their internal business systems. But regardless of the solution, one thing that they all have in common is that they all tend to lower flexibility over time! You would be reluctant to remove or replace a supplier with whom you’ve invested heavily in building a custom supply chain communications process, integrating your systems into theirs or vice versa.

In order to increase your supply chain resilience and enable your company to really take advantage of the possibilities that today’s globalization gives, you need to ensure that communication is not a hindering factor. Regardless of how sophisticated your internal information systems are, you can establish a front end towards your suppliers that enable you to easily monitor their performance and better yet, control what you provide them with as well as what they should provide to you. You should not let your current internal systems architecture stop you from becoming the best-in-class company when working with partners.

So, how do you achieve resilience and increase your supply chain flexibility?

Adding ShareAspace Design to Manufacturing as your supply chain communication service outside of your internal network and separated from your internal master systems, is a great way to increase your flexibility. With no loss of the granularity of the data you are sharing, be it drawings, BOM-structures, 3D CAD models, part material data, simulations or other product-related data, ShareAspace is able to import and control access to the information, ensuring that only the companies that are supposed to see it, can access it. ShareAspace Design to Manufacturing is also a great tool for monitoring the status and controlling distributed purchase orders and all the data that has been distributed together with these purchase orders.

Read more about the capabilities of ShareAspace Design to Manufacturing. Try it out yourself, sign up for a free 60-day trial. If you want to read more supply chain communication or purchasing of complex products, I can recommend two papers on the Eurostep website:

Regards,

Magnus Färneland,

Director of Manufacturing Industry at Eurostep