Supply Chain 20/20

Companies that don't have real-time visibility into their supply chains (and their demand chains) are losing focus on the promise of e-business. There's no use making a blind investment in automation technology if you can't see the big picture.



A review at the end of the pilots revealed a good deal of supplier enthusiasm for the new level of visibility. The lower tiers, especially, are always thirsty for information, Wise notes. They like to know what's going on as soon as possible. And for good reason: with faster notification of changes, suppliers can identify more efficient ways to react and work with the different tiers to find the best solution. In fact, Wise says the suppliers were disappointed when the pilots came to an end and they lost the visibility provided in the collaborative environment.


Wise says the company did not go into the pilots with the objective of deriving specific metrics for a return on investment (ROI) case. For DaimlerChrysler, the pilots essentially proved that visibility software could perform as promised and that suppliers would buy into it. With this proof-of-concept test behind it, DaimlerChrysler is conducting a second round of pilots this summer, including one with suppliers in Spain to test the global capability of the visibility software package the company is testing. (DaimlerChrysler was not prepared to reveal its solution provider prior to completion of the pilots.) For the second round, the automaker's focus is on exploring how the lower-tier suppliers can best use the visibility that DaimlerChrysler can provide to them, how they can incorporate that information to make better business decisions. We're concentrating beyond just the technology [and focusing on] the business processes that will be involved in managing this new type of data, says Wise.


Reflecting on his experience on the project, Wise recommends that any company considering a visibility initiative avoid getting lost in the technology and remember to take a hard look at both the company's business processes and those of its suppliers. We had to get a better understanding of each others' business processes so that we could see how the technology can automate those processes or potentially change them in the future, he says.


The company's vision for the Supply Network Collaboration initiative is to ensure visibility throughout all its critical supply chains and to have a more responsive, synchronized supply network capable of responding to customer orders as they come in. One of our main goals is to reduce our lead time, our cycle time, Wise says. We are trying to get more to a build-to-order mode, where we can react to our customers' requirements in a more timely fashion. To do that, we have to get all our supply partners on the same page, and we have to do that much quicker than we do today.


The Cow Was the Eighth Tier


In another example from the automotive industry, supply chain consultancy Healy Hudson is helping a European car manufacturer get a view of its supply chain.


When the carmaker in question (which declined to be interviewed for this story) found itself short on leather for the door assemblies of a new model, the company also found that it did not have the visibility into its supply chain necessary to detect the bottleneck responsible for the shortfall. Surmising that they wouldn┬╣t be able to solve the first problem without addressing the second, the company brought in a team from Healy Hudson to get to the root of the problem.


  • Enhance Your Experience.

    When you register for SDCExec.com you stay connected to the pulse of the industry by signing up for topic-based e-newsletters and information. Registering also allows you to quickly comment on content and request more infomation.

Already have an account? Click here to Log in.

Enhance Your Experience.

When you register for SDCExec.com you stay connected to the pulse of the industry by signing up for topic-based e-newsletters and information. Registering also allows you to quickly comment on content and request more infomation.

OR

Complete the registration form.

Required
Required
Required
Required
Required
Required
Required
Required
Required
Required
Required