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January - 2015 - issue > CXO View Point

Riding the Next Wave of Outsourcing: Supply Chain Management for New Product Development

Arun Kumar, VP of Omnex Asia, Omnex
Monday, January 12, 2015
Arun Kumar, VP of Omnex Asia, Omnex
Large corporations have been outsourcing supply chain management services for some time now. Typically the outsourced work has revolved around ERP implementation/ integrations, supplier portals, logistics,material tracking/handling, firewalls/ inspection and other similar activities. However, one major aspect that continues to fly under the radar is long-term supplier capability and the ability to support delivery, including market fluctuations. Supply chain management (SCM) is a large canvas and organizations can always look for improvements in this area outside of the typical cost reduction exercise that is conducted every year with the supplier. Long-term supplier performance and Q,C,D criteria (Quality, Cost, Delivery) are of critical importance to any organization, especially those that are launching new products.

Supplier Development/ Supplier Quality is a critical area that any company has to work on in order to achieve long-term sustainable supply chain performance and reliability. Developing suppliers is not a small project or a flavor of the month activity. It's not an implementation of ISO 9001 /ISO/TS 16949 /AS 9100 or any related customer-specific requirements. It definitely is not monitoring supplier dashboard and metrics, nor is it conducting training workshops that suppliers may attend at-will.

The implementation of any supplier improvement program has to ensure that a systemic culture is put in place at the supplier's end to make certain their processes are capable to deliver products/services as desired by clients and at the same time ensure that the supplier's interests are addressed.

This article will discuss the nuances from an Automotive Supply chain perspective gained through the experience of working with Automotive OEM/Supplier Bases worldwide on new vehicle launch programs.

There are five key aspects to a successful supply chain improvement program for a new product launch.

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