Today's ever-expanding supply chain offers businesses greater opportunities for efficiency and success in the growing global business environment. The instantaneous and constant flow of data, products and services around the world, however, brings with it a greater risk of violating the numerous and often complex U.S. trade compliance laws and regulations. Businesses that fail to set up policies and procedures to ensure compliance face risks ranging from shipment delays to hefty fines and penalties.
Automakers like Ford rely on thousands of tier-one suppliers to provide the materials, parts and services to make its final products. Many suppliers serve numerous automakers, and each of those suppliers, in turn, has multiple suppliers. Other industries' supply chains (such as electronics) are intertwined into the automotive supply chain. There are often six to 10 levels of suppliers between an automaker and the source of raw materials that eventually enter the manufacturing process. The breadth, depth and interconnectedness of the automotive supply chain make it especially challenging to effectively manage business and sustainability issues.
Managing inventory requires skillfully balancing a variety of complicated and competing objectives. Supply management professionals responsible for inventory have to control inventory holding costs, such as warehousing and financial opportunity costs, while pursuing cost savings that may be obtained with larger purchases. They also simultaneously support ambitious customer service levels for a constantly expanding product portfolio. Of course, supply managers who focus on inventory know these pressures well.
Years ago, supply management professionals turned to low-cost countries to manufacture products, establish services operations and source materials in an effort to improve the bottom line for their companies. They found that inexpensive labor in India, China and emerging Asian countries made this new low-cost-country strategy successful "” despite requiring the management of lengthy, complex supply chains. Then the world began to change.
Heineken recently announced new sustainability targets, stating that it aims to reduce the amount of water used in the brewing process to 3.7 hectoliters (hl) of water per hectoliters of beer produced by 2020, compared to 5.1 hl in 2008 (approximately 98 gallons by 2020, compared to approximately 135 gallons in 2008).
Projected cost modeling can help supply management organizations reduce procurement costs and generate information that could improve cost performance throughout the supply chain. Supply management professionals are aware that cost is often an important factor in making an informed business decision. And cost models can turn cost data into cost information, which can help organizations make better business decisions.
In the United States, the concept of supplier diversity is becoming more embedded in corporate culture each year. Supply management professionals seek out small- and midsized businesses owned and operated by women, African Americans, Hispanics and other minorities to round out their supply chains, and they are increasingly developing relationships and partnerships built on the foundation of mutual benefit to both parties. Such initiatives outside the U.S. often aren't quite as developed.
Economic activity in the manufacturing sector expanded in September following three consecutive months of slight contraction, and the overall economy grew for the 40th consecutive month, according to the nation's supply executives in the latest Manufacturing ISM Report On Business.
The business of helping people live longer, healthier lives is not taken lightly in any regard. Suppliers to Boston Scientific must guarantee extremely high quality and delivery, because the smallest imperfection or delay could be life-threatening. For this reason, the entire supply chain depends on efficiency and quality. The global indirect sourcing and procurement (GISP) organization at Boston Scientific is responsible for all strategic and tactical procurement of indirect materials and services, using a center-led operating model to organize sourcing around the world.