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unlocking

hidden potential

of your supply

chain partners

QuEST Global

Globalization and Supply Chain Networks – Not too long ago, these terms were just being coined and defined, and today we have Supply Chain professionals like us monitoring and managing highly complex supply chains from our offices

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0.3 Unlocking the hidden potential

0.4 Author Background

03

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© 2015, QuEST Global Services

Unlocking hidden potential of your supply chain partners

unlocking hidden potential of your supply chain partners

1

Globalization and Supply Chain Networks

Not too long ago, these terms were just being coined and defined, and today we have Supply Chain professionals like us monitoring and managing highly complex supply chains from our offices. Last decade and half we have seen million dollar ERP systems and Supplier Collaboration systems going in place. We have been told that, we can manage our supply chain by double-clicking the mouse on our desktop. Yet, we sit in our offices, dreading for the phone to ring, and staring at the dozens of emails we receive every day asking why a part has not been delivered or a customer complaint originating from poor quality from our Supply Chain partners.

Looking back where we started this journey of globalization, it is pretty nostalgic. I think we all remember getting on a plane from JFK, Heathrow or Frankfurt, going to parts of the world where we saw tremendous opportunity and major challenges.

It almost became a sport for us to develop our supply chain networks in these emerging regions. Going to a dinner with partner in Dalian in China and experiencing 20 course meal to wondering how the truck from the partner's facility will get to the port on time to bring our products back home, these all drove us to become adrenal driven supply chain junkies.

Emergence of New Breed of Supply Chain Professional – In the early 90’s, we realized, building these extensive supply chains are complex, we deployed our best manufacturing & quality engineers into the field. These folks

All of a sudden roles in Procurement, Supplier Development and Supply Chain became cool jobs. Companies started looking for the best of the best mid-career manufacturing engineers and quality engineers from their manufacturing operations. These individuals acquired the additional skills required to manage supplier collaboration and relationships.

The “Millennium Bug” – Newer challenges emerged over the early 2000’s. We were trying to unlearn our history which taught us borders and cultures. We were being told the world is now FLAT.

By 'flat' I did not mean that the world is getting equal. I said that more people in more places can now compete, connect and collaborate with equal power and equal tools than ever before

– Thomas L. Friedman (Author – The World is Flat)

brought to the partners, the experience in manufacturing the products as well as the insight on what could go wrong, and where you put the right controls. In addition what used to a gloomy shipping and back dock became a strategic logistics and materials management organization. Professionals here started talking about Supplier Development, Supply Chain Optimization and Strategic Sourcing.

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This resulted in the need to equip the next generation of procurement personnel entering the work place with newer skills. We needed them to understand macroeconomics and global commodity pricing, be savvy negotiators, u n d e r s t a n d b u s i n e s s f i n a n c e & r i s k management, and have command over global trade controls. We saw the emergence of professional bodies and university programs specializing in these skills.

Unfortunately our conscious effort to build these skills, resulted in lack of investment in developing the manufacturing and quality engineering competencies in these individuals. What’s making it a bigger challenge is also the fact that our experts from the early 1990’s are in the path to retirement.

All of a sudden this complex supply chain we have built over the last 2 decades seems to be a liability to our businesses.

Unlocking the Potential - The decade long investment has built strong network of Supply Chain partners. Nonetheless as our business cycles are shrinking and competitive pressures increasing. We need to continue to nurture and develop our partners. Today various high technology industries ranging from automotive to aerospace to medical devices rely on their partners to be keeping up with the industry challenges.

Cracking this code can provide competitive edge from technology standpoint and also provide a cost position to enter markets which are growing exponentially. Having built the foundation in our partners, it is imperative to development the partners further, to address emerging needs. The core skills in manufacturing engineering is essential to keep this engine running. In addition these skills are required across the fragmented supply chain centers across the globe. This can be a daunting effort for even the most globalized companies in the high tech industries.

Cracking the Code – One of the world-class aerospace companies came to grips of this reality few years back and took a fresh approach. They partnered with us, a Technology Service Provider, to develop a global center of excellence in manufacturing engineering & supply chain.

As a service provider, our core strength is building skills and competencies in a Strategic manner at the best cost. For our partner here, we have been able to build a mixed capability team to serve their global needs for their internal and external supply chain needs over the next 5-10 years. The team had grown into a 150+ member team with delegation to release technical packages into shops with limited oversight.

Today, by augmenting their internal teams, we are able to accelerate New Product Launch as well as Supplier Development across emerging countries. In addition, since we built our teams by bring in experts across industries, we are able to bringing in best practices. For example, APQP / PPAP from automotive industry in being adapted for application in Aerospace industry. Our manufacturing engineers from automotive industry have been able to customize it for the needs of Aerospace. <PPAP in Aerospace Whitepaper> Process Assembly Planning Inspection Planning CMC & CMM Programming Shop Documentation & Support Quality Management

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Centre of Excellence

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Management. Though there are multiple ways to address the gaps, working with a diverse technology service provider like QuEST can help accelerate the efforts.

So yes, we as Supply Chain professionals can turn these highly complex supply chains to our benefit. We don't need to dread for the phone to ring, we don't need to stare at the emails asking why a part has not been delivered, we don't need to stand in front of customer listening to their complaint on poor quality from our Supply Chain partners.

We can walk proudly up and down the hallways of our offices having demonstrated the value of the Global Supply Chain which has been built over the years.

© 2015, QuEST Global Services 3

One of our other Aerospace Partner, had a phenomenal challenge ahead of them to get their flagship product into production and also get ready for an exponential ramp up. They have worked with us, as their Supply Chain development partner to co-develop an approach to ensure successful product launch and readiness. Again we have been able to fill the manufacturing engineer skills gap and the regional support requirements using a mixed capability model.

Our team ensured, the launch suppliers were meeting qualification and compliance requirements on the first production batch being manufactured for certification. Our customer off loaded this activity to us since they believed we would be more effective in running a focus team with no other distractions. The “focus team” ran a program called “no part left behind” to ensure timely resolution of issues. The “war room” rigor complemented by predictive analytics helped the customer deliver the production lot on time for Certification.

In addition our customers are engaging our Supply Chain teams to ensure Delivery Assurance during the ramp up face. They are leveraging our global foot print to cover their regional supply base. They have taken the engagement to next level by even re-badging some of their employees in Asia to us. This is enabling our customer's internal teams in home base to focus on Strategic Sourcing, Advanced Technology development and Supply Chain re-design to meet their customers emerging needs.

Unlocking the hidden potential – We stand at a tipping out with respect to leveraging the Strengths of our Supply Chain partners around the world. Companies (OEMs) who crack the code and unlock the potential, will maintain dominance or regain their positions in their respective industries. Key element of success as discussed above is the excellence in Supplier Development strategies, core skills in Manufacturing Engineering and Quality

“If we all did the things we are capable of, we would astound ourselves.” – Thomas Edison

Unlocking hidden potential of your supply chain partners

unlocking hidden potential of your supply chain partners

New Part Introduction Delivery Assurance Supplier Development Cost Reduction

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Author Background:

Dinesh Sekar

(Practice Head –Manufacturing & Supply Chain Solutions, QuEST Global)

Dinesh has 20 years of Supply Chain Management experience in various industries including Aerospace, Oil & Gas and Power. He spent 16 years at General Electric Company, where he has managed supply chain professionals in US, Europe and Asia. Dinesh has developed and implemented strategic outsourcing strategies for various supply chain work streams.

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© 2015, QuEST Global Services

www.quest-global.com

References

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