Businesses across the world are in a state of flux. Whether it’s the after-effect of the recent recession or fear of a double-dip, the business landscape has changed forcing companies to examine the way they operate.
In an attempt to increase their competitiveness and improve company-wide efficiency, organizations are turning to management consultancies to overhaul their entire business. But one of the biggest areas for improvement that is often overlooked is the supply chain, and while management consultants are unsurpassed at analyzing overall performance and designing ideal operating structures, the intricacies of the logistics function require specialized attention.
With a multitude of questions, such as how to connect various global or regional suppliers, codifying the weight and quantity of hundreds or thousands of small and large parts for shipment, developing the build plan for the production line, understanding any opportunities for consolidation in various geographies and creating staging facilities for ocean, air and ground shipments, it’s easy to see the need for a specialist to achieve maximum profitability. But creating a detailed strategy is only the beginning. A supply chain expert must turn an idealized vision into a reality, managing the entire process efficiently, within strict time scales and most importantly, in a cost effective manner.
So, how do companies do this? How do they reengineer their entire global supply chain – which often accounts for a third of their business – building on what they already have and what they’re already doing well, while implementing smart suggestions from leaders in consulting? This article discusses the trialed and proven steps in that process.
Rocket science: Keep it simple stupid
Have you heard the phrase, “the simplest solution is often the best”? Well that’s exactly what logistics is about—applying commonsense solutions to complex problems. Whether it’s a fashion business or an industrial parts manufacturer, thousands of businesses have been able to transform their entire organization by making simple changes to their supply chain.
Take for example one of the world’s leading aerospace manufacturers, a CEVA customer, which was able to revamp its entire business by following easy to execute solutions tailored specifically to its needs.
Using best practice from the automotive sector, CEVA created a bespoke logistics solution that kept efficiency paramount, while ensuring that affordability was at the core of every element of operations.
The client, which was responsible for the delivery of a completely manufactured aircraft, created the end product based on various smaller components constructed by its partners. This large supply base, located across various geographies, meant that a material management structure and flow needed to be devised and implemented to ensure synchronous assembly and integration.
Leveraging our existing origin network, CEVA was able to coordinate and support suppliers by providing international and domestic movements to the customer’s inbound logistics center. From there, we developed ways to get the material to the production line in the most appropriate way—releasing material at exactly the right time and with the desired quantity needed. Real time visibility also means that we are able to oversee the entire operation, and that our customer is able to allocate shipments against in-transit inventory.
This solution ensures that all pieces of the complex puzzle work seamlessly, so that our customer is able to deliver to its high standard, all while reducing premium freight and warehousing costs for the company.
Change starts here
For any organization, there are various factors that need to be prevalent to bring about this type of change; these basic principles are required for the successful execution of any supply chain transformation project.