Resilience in the Supply Chain Supplier Collaboration and Supplier Relationship Management
This another blog in a continuing series discussing what makes for a resilient manufacturing organization. If you missed the opening discussion please read part 1.a summary of the topic, part 2 the introduction, part 3 Flexible Manufacturing Capacity & Scheduling, part 4 Enterprise Asset Management , part 5 Enterprise Asset Management II , part 6 Enterprise Asset Management III , part 7 Enterprise Asset Management IV , part 8 Facilities Managment , part 9 Human Capital Management
Essential to all manufacturing organization is the reliable supply of materials. And in most cases reviews of suppliers consists of price, quality, and reliability. Within a resilient organization the suppliers have to exhibit the same characteristics that the resilient organization does. It is no longer good enough to be reliable in normal circumstances (which can be a problem unto itself), but they have be able to be a reliable supplier during unusual circumstances.
Manufacturing has for years been reducing its supplier base. While there are cases for single source supplier (e.g. the only supplier of the material in the world), most companies opted for the sole source supplier approach. This is where a company assigns one supplier out of many possible suppliers the exclusive contract for the material. This is still applicable to a resilient organization. But before assigning the contract some additional criteria must be considered.
- Does the supplier have multiple manufacturing facilities capable of producing the material if there is an interruption at one plant?
- Is the extra capacity in these plants?
- Are these plants dispersed in a wide enough geographic are that a natural disaster will not affect the total supplier system?
- Is the material in question dependent on another material produced in one area or by one manufacturer?
- Are they willing to collaborate with you in resolving problems?
In today’s environment suppliers no longer just supply materials. They are an essential part of the manufacturing process. Working (collaborating) with them on material specifications, quality targets, production problems, are all part of today’s manufacturing and product design processes. A good supplier sees your success as their success (after all they want to keep you as a customer).
Have you faced issues with creating a resilient organization? Is it possible to build a resilient organization in the chemical industry? Are your suppliers resilient as well? Do you see your suppliers as partners? Feel free to discuss/share stories about these questions along with manufacturing in the chemicals industry in general in the comment space below.
Or join the conversation at @SAP4Chemicals