SCM Optimisation in the Capital Goods Industry

It is not only in the year 2020 that supply chain management is of outstanding importance. We highlight the success factors of supply chain management in the capital goods industry using the example of mechanical engineering.

  • What constitutes the resilience of a supply chain?
  • How much strategic space does it take for a supply chain to be stable?
  • Is stability or rather agility meant?

And, let’s take mechanical engineering for example:

What does it mean for the sales area if changes in the end product can be incorporated as efficiently as possible into the current workflow and thus

  • on the one hand, the customer can be served agilely, but
  • on the other hand, this agility can also be transferred to the company’s own production, but also to the supply chain – and this economically and with optimal transparency.

F&P Executive Solutions AG (in short: F&P) has combined the complementary competences in…

  • Design
  • Purchasing
  • Production
  • IT and
  • Project management and coaching

It is about standing out from the competition. As a result of a dynamic competitive field, this consequently requires dynamic change in one’s own processes. A change accompanied by change management. The goal is to integrate the digital transformation into the supply chain as such, but in synchronisation with the company’s own production – especially assembly. This requires the following

  • Recording of the requirements regarding the application of the ERP
  • Assessment of the material and procurement data (sourcing) in order to trim them for resilience through a restructuring of the in-house and external procurement process.
  • IT-friendly formulation of part specifications/costs in order to be able to compare them automatically, as a prerequisite for an agile supply chain
  • Integration (on-boarding) of suppliers in automated processes in the area of B and C parts, i.e. indirect and direct material (e.g. drawing-based parts)
  • Benchmarking which materials can be sourced at which costs (be it material or pure procurement costs)
  • Measuring the agility of the supply chain and measures to improve it; for example, through automated multi-sourcing

As a legacy system, the structures of ERP are very much shaped by the past. So the question arises:

  1. Where does the company stand?

How are supply chains mapped in ERP/SRM? How could supply chains be mapped with more strategic scope? Where does the data come from and who maintains it?

  1. What is the cost of transformation?

F&P has ready-made tools so that a transformation does not have to start from scratch. The easiest way to gain experience is to start with the indirect material, as a high percentage of the data procurement can already be provided by F&P – F&P as content supplier, so to speak. The next step relates to the procurement of drawing-related parts.

  1. What are the benefits of a transformation / fitness programme?

The evaluation of the data is accompanied by an initial indication of the profitability of a transformation to be considered – i.e. the ROI.

An agile supply chain can be evaluated with regard to its reaction speed in case of impending material shortage. This requires a normalisation of the material and supplier data in order to automatically request alternative procurement sources in the case of an emergency and to carry out the so-called re-routing of orders. The strategic framework for this is provided by strategic purchasing, supported by interim specialists from F&P if necessary.

The data in the area of commodities in SRM, or as a substitute for it, are provided by ready-made tools from F&P. The data in the area of drawing parts are also trimmed by F&P tools.

Now comparability is given and the trimming of the supply chain can be started as the next building block. Here, too, F&P can provide interdisciplinary support in the area of change management at suppliers or in the company’s own operative purchasing.

On the IT side, we at F&P support you with ready-made interfaces to your ERP in order to integrate the suppliers into the systems. The goal is to create a highly automated, transparent, autonomously reporting supply chain with order routing and order (RE) routing and a matching invoice processing

As an essential part of production, assembly is the control endpoint that has to serve procurement and in-house production optimally and as synchronously as possible.

Missing parts management is the actual aftercare, which can be improved by prudent precaution. A silo view (department “A” sees an ‘F’, department “B” moves the ‘I ‘ and department “C” argues in the ‘R‘, while another department describes the ‘E ‘.

Why F&P ?

To avoid that the customer recognises the 4 aspects ‘F’, ‘I’, ‘R’, ‘E ‘ as one of the first. Here, not only a domain specialist is needed. F&P’s experts already work together successfully and network both the internal processes and these with the external processes to form an agile service chain. This sets F&P apart from the competition and exemplifies digital transformation.

In this digital transformation, customers are involved in the collaborative, digitised specification of equipment, machines or components. This new type of collaborative engineering can then be finalised with innovative, agile suppliers and engineering firms in such a way that a continuous, agile supply chain is established and maintained as a competitive factor.

Tools & Services from F&P accompany you on this path with a new form of sustainability. Employees are trained on the tools and continue to be supported for a transitional period in such a way that the effects of improved value creation do not fade even after a longer period of time.