Here are eight common problems SDX can help you solve.

Managing a global supply chain, keeping tabs on supplier performance, and making sense of data across hundreds, and even thousands, of sub-tier suppliers are not easy tasks. Here is how we can help.

 

PROBLEM #1

Reducing Raw Material & Part Costs Without
Alienating Your Suppliers

You’re conflicted about the charge to go wring another 3% of cost out of your product – and concerned about the health and solvency of some of your suppliers.  You’ve been there, done that – six sigma, lean, TQM, kaizan, kanban.  Will this be the straw that breaks the camel’s back?

There is a better way.  Harnessing the power of material demand aggregation, SDX shows you who buys what materials in any given quantities at what prices and when.  This is the key to driving down cost without jeopardizing healthy, stable supply chain relationships – in fact, it will improve them.

  • Material and Part Consolidation: Consolidate common raw material and standard catalog part requirements of your sub-tier suppliers to create volume buys and accurate forecasts. Our typical customer saves 7-12% on parts and raw materials, just for starters.
  • Centers of Excellence: Adopt a more centralized purchasing process model to collaborate with your supply network and direct stakeholders to preferred part and material sources.
  • Alternative Sourcing Strategies: Orchestrate game-changing sourcing strategies for supply chain optimization, including directed buy, rebate, consignment, right-to-buy, and resale.
share raw material data

PROBLEM #2

Bills of Material Age Quickly

Anyone who knows raw material knows to the challenge of keeping data up-to-date and accurate.  New Part Introductions, design changes to existing parts, and transitions from one Tier 1 supplier to another could all potentially change a bill of material. 

Given the complexity, this is no place for spreadsheets. In contrast to linear demand planning processes that depend on individual suppliers to cascade requirements tier-by-tier, SDX dynamically detects activities that might change a bill-of-material, alerts appropriate stakeholders, and  pushes updates to production forecasts and change requests to affected suppliers.

No more armies of people and the mother-of-all-spreadsheets to keep tabs on your bill of material. As a single system of truth, SDX serves as the digital thread connecting manufacturing data from the original design to the finished product through all tiers of the supply chain.

extended supply network

PROBLEM #3

Late Parts Threaten to Bring Things to a Halt

You’re notified that your manufacturing line has screeched to a halt. A critical component is out of stock – only to discover that the part or worse, the raw material that goes into the part, such as a pricey forging, a $3 fastener, or a $120 piece of bar stock, is late. Or ordered to the wrong specification or size. Or not ordered at all. A few dollars worth of material is now holding up your shipment of tens of thousands of dollars worth of product. 

The ‘long pole in the tent’ when it comes to lead times is rarely the part itself – it’s the material that goes into the part.  Sound familiar? Avoid this costly error with SDX.

Think of SDX as an early warning system or a ‘control tower’ for your extended part and raw material supply chain. It’s the simplest answer to keeping an eye on the timely purchase and supply of materials  by your Tier 1- N Tier suppliers. 

Combining your master production schedule for parts with the extended bill of materials captured with PAC, SDX alerts you to potential disruptions weeks and even months before they become a problem. Artificial Intelligence and intelligent algorithms take into account dozens of variables to help ensure that raw material is never the reason a part is late to you.

supply chain control tower

PROBLEM #4

Low RFQ Response Rates

Common Request for Quotation (RFQ) Challenges: 1) No-bids 2) Incomplete bids 3) Unqualified responses.

Identifying common part families and directing RFQs to suppliers with relevant part manufacturing capabilities is the best way to improve RFQ responses.  The problem is most buyers don’t have the necessary level of detail about their parts  – what raw materials go into them and what manufacturing and special process capabilities are required to make them.  This is where PAC comes in.

Imagine you could group all parts fabricated from 6061-T6 aluminum bar stock that require turning, milling and grinding, as well as heat treatment and deburring. Then imagine you could source those parts with suppliers that have exactly those capabilities. The result – faster, more complete and competitive RFQ responses.

raw material supply chain analytics

PROBLEM #5

Can't Track the Material Origin
or Supplier Compliance

REACH. RoHS. DFAR. Conflict Minerals. Country of Origin Disclosures. Just Name Your Compliance Requirement.

Compliance and sustainability are essential components of a world-class supply chain. Typically these
essential programs involve auditors, attorneys, and buyers chasing spreadsheets from supplier to supplier. Painful and unproductive. 

Supply Dynamics has an alternative approach to compliance. Where possible, we document compliance requirements from engineering drawings, specifications, and other technical data and associate the requirements with relevant parts and assemblies. Via SDX, Tier 1- N Tier suppliers can view and validate material and provide compliance information. Receive real-time notifications of supplier and material compliance violations in an instant. 

track country of origin disclosures

PROBLEM #6

Volatile Commodity Prices

Since most OEMs outsource the majority of parts that go into their products, many can’t tell you how much raw material is usedlet alone the quantity or cost of the chemical elements that go into them (things like tin, molybdenum, tungsten, gold, nickel, iron ore, moly oxide, etc.).  Since metallic raw materials and other material-inputs can account for 30-60% of a product’s total cost, that’s a big deal.

The SDX Multi-Enterprise Platform not only provides a consolidated view of all of the materials that go into your parts, it helps you quantify your aggregate exposure to various chemical elements to support hedging  and other risk abatement strategies.

manage supply chain commodity pricing

PROBLEM #7

Right Arm Doesn't Know What the
Left Arm Is Buying

You’ve grown through acquisition and lack ERP, PLM and IT system commonality. You know your company could reduce raw material and part costs if your different business units and divisions could purchase like parts and materials off of a common contract, but the data’s a mess.  

At Supply Dynamics we’ve seen it all…. Different business units buying the same parts, but using different part numbers. Corporate sourcing teams attempting to integrate spend data from an acquired company, but giving up due to the absence of a common naming convention or data taxonomy across sites and sub-tier suppliers.

After standardizing part attributes and raw material data via PAC, leverage SDX to aggregate demand and finally visualize where synergies exist across business units and sub-tier suppliers.

Ensure Data Continuity

PROBLEM #8

Sole Source for a Critical Component

The key to eliminating sole sources of supply lies in creating a compelling reason for other qualified sources to furnish a part, raw material, or component. 

One customer achieved a 22% cost reduction for a specific grade of raw material. After using PAC to document the bill of materials for all parts and assemblies and SDX to forecast the combined raw material demand across multiple sites and sub-tier suppliers, they were able to entice a new source of supply to enter the market. 

Triple win – sole source of supply eliminated, cost reduced, AND service levels improved.

Ready to transform your supply chain? Let us show you how.