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.
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, Kaizen, 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.
Anyone who knows raw material knows it’s a challenge to keep 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 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 bills 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.
You’re notified that your manufacturing line has screeched to a halt. A critical component is out of stock 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, your contract manufacturer ordered raw material but to the wrong specification or size. Or, they didn’t order the raw material at all!
A few dollars worth of material is now holding up the shipment of tens of thousands of dollars worth of product. When it comes to lead times, the “long pole in the tent” is rarely the part itself – it’s the raw material that goes into the part.
Think of SDX as an early warning system or a “control tower” for your raw material supply chain. It’s the simplest answer to keeping an eye on the timely purchase and supply of materials by your Tier1-Tier N suppliers.
By linking your demand for parts and assemblies with related bills of material, SDX alerts you to potential disruptions weeks, even months, before they become a problem. Artificial intelligence and sophisticated algorithms take into account dozens of variables to ensure that raw material is never the reason a part is late to you.
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, including 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.
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, Tier1-Tier N suppliers can view and validate material, provide compliance information, and receive real-time notifications of supplier and material compliance violations in an instant.
Since most OEMs outsource the majority of parts that go into their products, many can’t tell you how much raw material is used let 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.). Considering 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 also helps you quantify your aggregate exposure to various chemical elements to support hedging and other risk abatement strategies.
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.
But PAC can change all of this.
After standardizing part attributes and raw material data (using PAC), our cloud-based multi-enterprise platform, SDX, leverages that data to aggregate demand and finally visualize where synergies exist across business units and sub-tier suppliers.
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.